It was the American writer and entrepreneur Mark Twain who said: "Prophesy is a good line of business, but it is full of risks".
So, as we turn our backs on a horrible 2018 for the encrypted markets and face 2019, it's the first time for us to see who is taking the risk of staying with the encrypted price forecasts, and secondly for us here at GlobalBlock notice what we see as key factors for the market.
Let's start with the forecasts.
Mike Novogratz (the former billionaire fund manager Goldman Sachs and founder of Galaxy Digital) has provided various forecasts for all of 2018 that have been reviewed, particularly because some of these have not been accurate. However, in a recent survey, it suggests that it is realistic to expect Bitcoins to reach $ 20,000 next year. Sonny Singh (CCO of Bitcoin Bitpay payment service provider) also said, in line with Mike Novogratz, that a price of $ 20,000 is reasonable for Bitcoin in 2019.
Calvin Ayre (founder of Bitcoin Cash and now figure of Bitcoin SV) believes that Bitcoin will go to zero in 2019. This does not reflect a general bearish attitude towards cryptography, but more a belief that Bitcoin has been supplanted by a more scalable technology and solutions.
Tom Lee (CEO of the market research firm Fundstrat) and Sam Doctor (Fundstrat & # 39; s Quant Strategist) had a brutal year considering some incredibly positive forecasts for Bitcoin in 2018 that did not materialize. Although their forecasts for 2019 are not as optimistic as some still believe a Bitcoin price of $ 36,000 is achievable.
So, let's take a look at which GlobalBlocks consider key areas that could have the greatest impact on market prices and in particular on Bitcoin the next year.
The cryptocurrency industry has so far been regarded as the wild west; an analogy that is regularly shifted into every new immature sector of the financial market. Governments and institutions have looked to space in the last year and are preparing to make big moves, but the hesitation is the dominant force at the moment until an assessment is made on the best way to introduce the regulation.
The KYC (Know Your Customer) and AML (Anti-Money Laundering) regulations have become more stringent in recent years, have started to tighten the market and reduced the "bad actors" and most of the industry is looking forward to more supervision and Regulation. As Casey Kuhlman, co-founder and CEO of the tech company blockchain Monax, said, "the industry can and should benefit from the transparency, speed, efficiency and reliability" offered by regulation.
The Financial Action Task Force (FATF) recently revealed that encryption exchanges operating in the United Kingdom have a low risk of money laundering and terrorist financing. This provides a good starting point and hopefully with the progress of 2019 and the expected settlement, confidence in the sector will increase and institutional investors will be more confident to enter the market.
One of the obstacles for Bitcoin, in the eyes of traditional investors, is the perceived barrier of entry. For many investors, the challenge of buying, storing and safeguarding money is enough to move them away from potential involvement in the sector. Exchange Traded Funds (ETFs) would help mitigate risk by registering Bitcoin's price in a similar way to an index and, in the eyes of investors, remove Bitcoin's wild west image.
An ETF proposal was first presented by VanEck and start-up SolidX, which collaborated with the CBOE at the start of 2018. An ETF would be considered a reliable reputation of Bitcoin that could bring further interest by institutional investors. So far, however, no approval has been issued by the SEC. There were a series of big trash throughout the course of this year, with Gemini (the Winklevoss brothers in exchange ownership) as the principal applicant and a particular day with less than nine rejected at once. The verdict on the SolidX proposal should be reviewed on February 27, 2019.
"The cryptocurrency industry has so far been regarded as the wild west, an analogy that is regularly shifted to every new immature sector of the financial market: governments and institutions have looked at space during the last year and they are preparing to make big moves, but the hesitation is the dominant force at the moment until an assessment is made on the best way to introduce regulation "
And so, we come to our forecasts for 2019, an opportunity for us to take a deep breath and commit ourselves to print our thoughts and our expectations for Bitcoin and the market over the next 12 months.
With the highs of December 2017 felt like a lifetime ago, Bitcoin has steadily decreased during 2018. If we look at the previous trends, it takes about 67 weeks on average for Bitcoin to recover and bring new historical highs. If you follow this logic, Bitcoin would move towards $ 20,000 in the second quarter of 2019. However, this is highly optimistic and while those levels should be re-achieved in the future, this short period of time is not realistic given the hesitation that exists from a bracing investor base after this year. With positive news, ETFs and regulations, we believe Bitcoin will recover from $ 8,000- $ 10,000 during 2019, the date a decent year would be balanced today.
It is said that Ethereum will further threaten Bitcoin's dominance of the market, but we do not share this view because Ethereum is a very different beast from Bitcoin. Essentially each of these coins serves its own niche and where Bitcoin is a digital currency, Ethereum is a vehicle for smart contracts. The main theory for the Ethereum domain derives from its scalability. The Bitcoin blocking limit on the chain is 1 MB with three or four transactions per second allowed. The Ethereum blockchain has no such limit and the number of transactions is entirely decided by miners.
Bitcoin has made great strides to combat transaction speed and bottleneck issues by implementing SegWit and Lightning, which both help manage and facilitate the network more efficiently without changing the size of the block, however, Bitcoin is threatened by its same hardfork: Bitcoin Cash. When the fork came in August 2017, developers tried to take the brand and assign the name "Bitcoin" to Bitcoin Cash (BCH) (Bitcoin Cash also owns the bitcoin.com domain, personalizing itself as Bitcoin when it is not. )
"With positive news, ETFs and regulations, we believe Bitcoin will resume levels from $ 8,000 to $ 10,000 in 2019, the date a decent year would be in balance today"
Bitcoin Cash and its hardfork Bitcoin SV (BSV) are innovations of Bitcoin's initial idea. We use the word innovation in an approximate way here because Bitcoin Cash has just set up a bigger block to combat the problem of resizing; if their network became so popular and widely used that the 8MB blocks had been filled, they could have increased it further.
To conclude, 2019 is proving the most interesting moment for Bitcoin and other cryptocurrencies. In particular, we wait with interest as Bitcoin Cash and Bitcoin SV develop in relation to Bitcoin, which has some commentators who speculate on whether it is to do or destroy for the foundation cryptocurrency. One thing is certain: cryptocurrency will continue to make news in one way or another, and we believe there are many reasons to be positive in the coming year for both cryptocurrencies and the underlying blockchain technology.
Best wishes for next year!