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The fact that the bitcoin price has been crashing for the past month has led some people to have some hilarious reactions.
From rage-quitting crypto-trading and investing to astonishing doomsday predictions, it's really fun to sit back and watch all madness.
However, I feel like it's also my duty to step into and calm things down for a second. Honestly, this "crypto-bubble" You're tired of hearing about has not popped.
It has not even begun to form.
If you do not believe me, you're in for a treat, for today we'll be discussing how to look at things in the world.
I'm not saying I'm an all-knowing guru. That's not the point.
The thing is that people get excited and really want to work for those likes and shares. That's all fine; it's the world we live in today, not here to judge.
But, c'mon; at least have the decency to put things into perspective. Do you know how the dotcom bubble grew before bursting? Do you have any idea?
When the dotcom bubble exploded, close to 20 years ago, the total market value was around $ 6.7 trillion. In today's money, the value of each is 40 percent lower. This simply means, this bubble would have reached more than $ 9 trillion.
See where we are now?
We're about 1.5 percent into the bubble. How frightening.
How Much is Crypto Worth?
Right now, the current mindset is that cryptocurrencies are in some sort of downward spiral. According to some news sources, that is.
Obviously, when we look at the bigger picture, we can see that is not the case.
With the most recent developments in Lightning Network technology, a Bitcoin peer-to-peer scaling solution, we are now starting to see more adoption and more. As CCN reported:
We have begun to slide, the effective throughput of its more than 11,000 nodes had surpassed $ 2 million when we started researching this article. Somewhere else over $ 1.97M, or 432.7 BTC.
Cryptocurrency market cap has devalued more than 70 percent since its peaks highs close to $ 1 trillion, during early January this year, which has led people to believe we're finally out of luck, and there is little hope crypto will recover any time soon.
Of course, it is always the most desperate moments, when hope is all but gone.
I do not think we will see prices for that much longer. Soon, there will be an upwards correction.
If you need more fundamentals, moreover Bitcoin's hash rate maintenance to countries like Venezuela, we could use, perhaps, an alternative argument.
Is bitcoin over-priced?
McDonald's would probably be a little bit better than McDonald's.
Financial freedom> burgers
But hey, that's just me.
Usability Creates Adoption
Visa Managers may be more than $ 30 billion a day, or $ 11 trillion per year according to their self-disclosed stats. That's a capacity of 65,000 transactions per second.
Bitcoin can handle only about 7 tx / s on chain, or about 0.01 percent of Visa's. Yet bitcoin transfers about 25 percent of Visa's amount of value processing.
In their recent quarterly reports, Mastercard said they processed $ 4.4 trillion in the year to date, while bitcoin would be at about $ 3 trillion on a year basis if we extrapolate from the daily $ 8 billion – a level that is fairly common for BTC.
Do you guys know what this means?
Bitcoin is close to overtaking.
This really makes me wonder: What is the big deal of using bitcoins mostly as a store of value?
Even if it's slow and boring, it's much, much safer than any centralized third-party settlements layer.
To the end of the period, to hedge funds, to pension funds, etc. to join the brave privateers that beat them to the new world of cryptocurrency and blockchain.
Bakkt even Announced their first contracts for BTC would be a one to one ratio.
All this is bullish.
But way more exciting is what comes next.
Key Players Shifting Towards Crypto
Have you wondered why the total market capitalization went up 881 percent in 6 months?
Currently, the Chinese yuan accounts for only 0.79 percent of bitcoins daily trading volume (give or take).
When was the last time the Chinese public had straightforward access from the yuan to bitcoin anyway?
December 2013. Almost 5 years ago.
China stopped mainstream financial institutions on the mainland from dealing with bitcoins in December 2013, when the overall market cap for all cryptocurrencies was only $ 15.7 billion.
It drives me nuts just thinking about what's going to be like when most countries open their doors to cryptocurrencies – one way or another.
Yes, even through centralized digital currencies, backed by governments, which will happen sooner or later.
Technology Developments ‡ User Adoption
Just by looking at Dapp Radar, a website focused on showing statistics about decentralized applications, we clearly see there is not much adoption yet.
That means that it seems to be tiny, too soon to jump into any sort of conclusions, about future use-cases. That is, most dApps have been released either in 2017 or 2018, so there is not enough time to properly implement token-models which leverage tokens in the most amazing ways possible – which will be a huge catalyst for user adoption .
Some takeaways from an amazing data scientist, on the topic of dApps and adoption rates, are:
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"We are orders of magnitude away from the consumer adoption of dApps. No killer app (outside of tokens and trading) have been created yet. Any seemingly "large" dApp (ex IDEX, CryptoKitties, etc) has low usage overall.
-
"All of the top is still very much about speculation of value. Decentralized exchanges, casino games, pyramid schemes, and even the current collectible games (I would argue) are all around speculation.
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"What applications do we offer?" And "take advantage of the true unique properties of a blockchain" (censorship resistance, immutability of data, etc) and unlock real adoption?
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"For new protocols, instead of trying to convince existing applications for developers and developers.
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"We are an ecosystem need to build better tools and infrastructure for more widespread adoption of dApps. Metamask is an awesome tool, but it is still a difficult onboarding step for most normal users. Toshi, I'm really looking forward to the creation of other tools to simplify the user onboarding experience and improve the general UI / UX for normal users. "
Plus, I believe there is an actual use-case for a great deal of cryptocurrencies out there. otherwise:
- without litecoin we would not have a live testnet for bitcoin improvements.
- Or without BCash we would not have a blockchain with 32mb blocks.
- What about Ethereum? Thanks to this protocol, have an easy framework to deploy cryptocurrencies and smart contracts.
- without Steemit we would not have a decentralized, incentive-based, social network.
- Without the Basic Attention Token we would not have Brave, a decentralized browser that pays content creators.
- Do you like privacy? Well, without Zcash, we would not have ZKsnarks, providing anonymity and privacy in the blockchain technology.
- Or without Stellar, we would not have institutions looking at public blockchain solutions.
- Finally, without Aurus we would not have a stablecoin based on tokenized gold assets (much safer than tether and its "Peg" to the USD).
Put Your Mind At Ease
There's a lot of work left to be done. What's the best thing to do now? Well, I do not know about you, but I'm still going to take advantage of these continuous.
Bitcoin's still one of the most (if not the most?) Best-performing assets since its inception, close to 10 years ago.
Just think about the dozens of times we've seen bitcoin crashing.
The conclusion is rather quite simple, and I guess we'll always end up in circles around the same stuff:
Since bitcoin plunged from an all-time high of nearly $ 20,000 to its current price around $ 4,000, crypto naysayers such as Warren Buffett, Jamie Dimon, and Nouriel Roubini reiterated their position that the crypto markets will end poorly, while crypto bulls point to bitcoin's previous crashes and multiple comebacks.
One interesting thought is that on the crash. That's definitely a very good sign!
Conclusion
The reason why we need to take a break from time to time.
Bitcoin is still in its early days, and I'm quite sure, we'll be able to see huge bears and bulls. If you're patient enough, of course.
Do not forget, buy when there's blood in the streets!
Disclaimer: this article should not be taken as financial advice; it represents my personal opinion and should not be attributed to CCN. I have savings invested in cryptocurrency so take whatever I write with a grain of salt. Do not invest in order to buy and read as much as possible about a project before investing.
Featured Image from Shutterstock
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