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The Road Ahead A Dark One for Bitcoin? Experts give their opinions on the cryptocurrency and blockchain market
It is not a lie to say that the worlds blockchain and cryptocurrency they have been subjected to some skepticism and even more in terms of decline. When we reach the end of 2018, we are living one of the longest bearish markets for this in its collective history.
Meanwhile, the applications of the blockchain in the world of finance, health, education, games, etc. They have been somewhat attenuated by a declining crypted market. With more bears comes a higher risk aversion to which it belongs.
But how do we get closer to 2019, critics of delirium are right when they talk about 2018 spelling out the end of Bitcoin and the like? Well, the narrative seems to be much more complex in the opinions of financial experts and Nobel prizes. We take the opportunity to bring you some of their thoughts.
"It's not the fall that it gives you, it's the sudden stop at the back."
Downward trends in the market apart, where it is Bitcoin compared to where was it at the beginning of this year? It is close to where we can expect its new lower support to be, at least according to some of the thoughts provided by Brian Kelly.
Participating in an interview with CNBC, the founder of Brian Kelly Capital argues that detractors have pointed out that Bitcoin is already being resolved. With this hypothesis, Kelly is. pointing to a bullish scenario as a question of when, not if.
"For me, the Bull case and the investment case is that all that can be said is wrong with Bitcoin that will be solved," Kelly says, and continues.
"It's similar to what we've seen from the internet, and Internet is notoriously slow … With the passage of time, technology has improved, the rate of adoption has improved."
It is here that Kelly makes a valid point, but he stops on some of the intrinsic problems that Bitcoin has in terms of improving himself. In the past, his community has been an important detriment to any passage from a job trial to a test of the stake consensus system.
But this is negative from the point that the developers out there are looking for solutions. Those like MimbleWimble show that the community knows that improvements are needed.
So, what is the ideal scenario? If Bitcoin updates its network, taking care of what must be ordered, what kind of threshold will it have to hit for mass adoption to be inserted? The answer is not so much about where it is now according to Kelly.
"The basic line is that you have to solve problems and you have to have a good percentage of adoption," Kelly continues.
"Recently there was a good article that mentioned that the 8% of Americans who invested in Bitcoin and 10% is the rate of adoption needed, so it's just being punched."
The chronology to hit the bottom
Brian Kelly he himself is no stranger to adversity, having been a supporter of cryptocurrencies in a form or a form since 2013. It is with this in mind that it still offers some wise words even for the most hawkish or trusting buyers of bitcoins.
"I've always said that the 1-5% of your investment portfolio should be dedicated to cryptocurrencies because it's the most risky thing you can invest in!"
From a temporal point of view, Kelly believes that Bitcoin is approaching lower support and believes that the first quarters of 2019 will represent a financial obstacle for the Bull's 2017 year.
"We are approaching the bottom, where once we have seen the 2017 optimism, we are seeing what is reflected with pessimism when we enter 2019, so the pre-conditions are there to hit the bottom".
While he stops short of an empirical timeline, Kelly has his own opinions on where Bitcoin will crash, and which includes $ 2,900 support. To put it in perspective, it is a decline of 80% in the value of Bitcoin. But rather than putting the market on ice, investors like it Brian Kelly, they are seeing a lot more than bullish sentiment.
"I would have thought Bitcoin was harmful, but I can only tell you from the phone calls we are making, the institutions are watching this as" Ok, it went through a bear market, it did not go away, so now we need to expose ourselves to it . & # 39; "
For miners, the bad news of the bear market has been mitigated by a relative reduction of the breakeven margin for profitability, according to Kelly, citing that this equal point stands at around $ 3,000.
The best is yet to come for cryptocurrencies, innovations and cryptography
While Cryptos they could reach their respective funds and lower levels of support, innovation and the potential for use and institutional application are not even close to each other. Speaking with Bloomberg, Nobel Prize winner Paul Romer shared his insights into the application of cryptography for the money of the future.
So where does this application of blockchain technology come from in the world of finance and the money movement? The answer includes a number of attributes, one of them, according to Romer – Cryptography.
"The first thing we need to consider is that cryptography is very important, and it's something we need to strengthen our use of cryptography if we want to keep things safe."
Cryptography, for those who otherwise would not know it, is a means of protecting the data necessary for it and, by extension, the money transaction. The value? Encrypting and protecting data means that it is much more difficult for unsolicited third parties to intercept and use that information.
And it consists of four main attributes:
- Confidentiality – It refers to the protection of third party data / information and unauthorized access
- Privacy – This refers to the protection of information from individuals.
- Not repudiation – This means that the inability to deny specific action has taken place, allowing it to be a completely objective system.
- Integrity This refers to an intrinsic safety for users that manipulation can not and will not happen to their information.
Simply going in shallow depth about what encryption is, the value of Blockchain can be made clear This need for cryptography, explains Romer, is due to the great diversity that exists with financial transactions.
"There are many ways to get digital and financial transactions.The best way to think about this is as an accounting exchange system, and credit cards are an example of this."
So where does it do it? blockchain technology are you coming to this? Two words: Trustless Technology, as Romer explains.
"Some entities for exchange systems that work with some banks work to keep track of all these transactions and who owes what to whom," Romer continues.
"The difference with Bitcoin is that it's trying to create an accounting exchange system like that, but with nobody you need to trust in. It's a group of totally independent people who have a reason, based on this idea of extraction. , to keep track of the Ledger [Distributed Ledgers]".
While this year was one of uncertainty for the cryptocurrency market, was even more eloquent for the stock market and also for centralized banks. The latter, having been involved in a series of disputes, such as the recycling activities perpetrated by Danske Bank, and the most recent activities with Goldman Sachs.
Trust is something that systems and centralized governments are losing rapidly, as a Bloomberg host responds in perceived nervousness towards a cryptographic ecosystem without trust.
"In all honesty, it should make you a little nervous if you have a government that is otherwise dissolute with its money and expands its deficit accordingly.A lot of theory behind Bitcoin and Cryptocurrencies is that people do not want to trust a government to block a currency ".
While some of these hesitations are well deserved by those who pay attention to the news, Romer argues that governments and banks have at least managed to create greater stability during inflation inflation cycles.
"This idea that the government can not manage it or can not do it the right way, I think it is overestimated."
But Romer is certainly a staunch advocate of innovation as a means of market growth, and considers Blockchain technology to be one of those innovations, but we are only at the tip of the iceberg when it comes to real cases, according to Romer.
"We have not yet seen the full application of the technologies that have been invented: cryptography, for example, there are ways to protect all our communications and keep our secrets secret, but they are not used," Romer continues.
The invisible, long hand of application
Whether it is to support logistics, or the level of information about a food supply chain, to the world of high-powered finance, Romer expresses the awareness that there is a large margin of application for the blockchain.
"Being able to track down a product on a supermarket shelf directly from the supplier would be a great thing, whether it be on Blockchain or not."
Tip of the iceberg or not, at this point in time, Romer seems to consider the early blockchain decentralized methods as interchangeable with centralized solutions, and early youth and lack of use cases could very well be the reason for that. .
This is a state of affairs that will not last long, as Kelly has brought with CNBC. With a much higher institutional interest rate, both in blockchain technology and in the cryptocurrency market, we are already seeing large companies like Amazon playing with blockchain to get them to function as a service tool.
Diplomacy of the dollar? Is bitcoin a threat to the dollar?
While we can claim that blockchain technology has created a number of winners, those who were early adopters or investorsTo the companies involved in taking a high share in the mining cryptocurrency or in the production of equipment, Romer believes that Blockchain has, in its own way, generated a certain degree of inequality, which is difficult to agree.
First users and investors in this technology it can not be considered as the beginning of an unequal system, only that they were the first to adopt. When it reaches a point of mass adoption, the market will no longer be dictated by those who are technologically sound enough to put it into practice.
But aside from the kind of market Bitcoin is involved with, Romer has been intrigued by the prospect of Bitcoin as a rival of the American dollar. It was an intriguing question, but that he thought did not have an immediate force on the American currency.
"I predict that in a hundred years there will be at least a second alternative to the dollar and the Fed [Federal Reserve] as a compensation bank for the world … And this is still up for grabs now. "
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