Cryptocurrencies, Bitcoin, Bitcoin Cash, Ethereum, LiteCoin: all terms that have been swirling
around in the media over the past few years. 2017 saw coverage of the cryptocurrency
phenomena reach new heights on the back of the combined value of the market capitalisation
of digital currencies recording 1600% growth. As of early January 2018, the market
capitalisation of cryptocurrencies sat at comfortably above US$300 billion.
How things changed over the course of 2018. The cryptocurrency market is still several times
more valuable than the $18 billion it was as 2017 got underway at around $111 billion towards
the end of 2018. That’s the good news. But it has dropped back to levels last seen in the
summer of 2017, before the cryptocurrency ‘bubble’ started moving into overdrive. Bitcoin
started 2017 at $1000 and finished it at $20,000. Almost a year later and the ‘original’
cryptocurrency has dropped back to under $3500.
There are a handful of key factors that most market observers believe will have to fall into place if cryptocurrencies are to make a serious comeback. It is unrealistic that all of these will suddenly become a reality next year but things moving in the right direction will give cryptocurrency investors reason for optimism.
At the Bloomberg Crypto Summit in London, held in early December 2018, James Bevan, chief
investment officer at CCLA Investment Management, delivered the appraisal that he expects cryptos to bounce back:
“I don’t regard this as an existential crisis, I just regard it as a bump in the road and institutional
investors have had plenty of bumps in the road in conventional currencies and transaction
systems.”