The crypto currency market is down and that is not surprising news for everyone. But the market has been down for a pretty long time. Therefore, it is expected that people would feel that there is no actual real value in this, which, is not actually true. Crypto currency is not backed by anything. However, this is not the real reason why the market is crashing. The sector faces significant growing pains and considerable public opinion crisis and fraud issues. But there must be certain main reasons why the crypto currency is down for such a long time. Here is a list of five main reasons why the crypto currency is down.
1) Public’s opinion that the crypto currency is a short term investments
Let’s face it. It is not a straightforward way to make money in this sector. Now, this can raise some concern about how genuine this whole thing is. But as for investments, people want to invest in sector that are more straightforward and feels genuine and safe. Because of Institutional investing in crypto currency, most investors are millennial who view crypto as a short term investment. This is the reason why unlike other assert classes, people typically don’t include crypto currency in their potential retirement plan. When people want quick returns, they get in and out of the market, thus making it volatile.
2) Widespread market manipulation
The “pump and dump” scheme by the major part of the investors is one of the major reasons for the market crash. This means inflating a crypto currency’s value only to sell it off at its peak. This does makes quick profit for the investor, but does affect the market. It is easier to accomplice especially with smaller market cap crypto currencies. Exchanged have different levels of liquidity which in turn impacts how they price their crypto. Crypto currency is decentralized which means it is not a centralized entity like a bank or one which the government can control. Only supply and demand determines its price and it differs widely. However, this manipulation is not limited to small cap companies.
3) Making money Is less straight forward
Crypto currency adopters used to either capitalize on ICOs (Initial Coin Offerings). This was done by getting in early and getting out, mining and holding crypto currency for long periods of time or by day trading. However, these days, none of these methods can guarantee you a fortune. Because of more competition and difficulties in the Bitcoin mining, hash rate required to mine isn’t always worth the high electricity bill. Day trading is much more difficult in a bear market which is as unpredictable as the crypto currency market.
4) Raising cost of mining
Bitcoin is dependent on a system of miners. This verifies transactions and records them on a digital ledger which is called the block chain. The miners are rewarded in Bitcoin as a reward for their time and energy involved. However, the price of mining keeps increasing with the increasing work. With the heavy price and high electricity bill, mining operations re shutting down as bitcoin’s declining value has made mining less profitable.
5) Security concerns
With hacks, exit scams and Ponzi schemes, bitcoins have gained a negative press image. Some even go to the extremes of calling ICOs frauds. This is the reason why investors have a meek trust in the crypto currency. Stealing funds from exchanges is rather easier. Exchanges cannot be trusted across the board.
Crypto currency just needs a round of innovations for the investors to trust it more.
Financial freedom is what the whole world is craving for. The achievement for this golden trophy is proper planning and investments. You might decide to stick with one stream or go forward with having multiple stream incomes. To choose the right option you need to analyze the economic challenges and choose the right thing.
The altcoins have introduced itself with a lot of options in the market. Now in the large ocean, how are you going to find your bunch of coins which will generate wealth for you?
Investors who earn their major incomes from cryptocurrencies have invested mainly in bitcoins. Once bitcoins achieved success and popularity, there were entries of other alternative cryptocurrencies.
The coins with potential profits are:
Bitcoin standing at the top of the chain, Ethereum backs the second spot. It is a widely known cryptocurrency. The recent FUD issues around this currency did not make the currency take a dip. There is no reason for you have doubt while investing in this currency.
Vitalik Buterin had placed the path of Ethereums in the market. A bunch of developers were also behind the development of this currency. He was of the view that blockchains could be used for more than just making a payment. He leveraged the technology and taught the world that, applications can be created THROUGH blockchains.
Ethereum has graced the blockchain ecosystem by its presence. Smart contacts has attracted a major crowd of app developers and interested a flock of investors globally.
Ripple is also one of the best choices your finance dairies could witness. Ripple networks have instant offers and low-cost international payments. Ripple is one of the few cryptocurrencies that permits banks to settle cross border payments in real-time. This step was taken to encourage transparency.
Ripple holds a very unique consensus ledger. The Tokes owned by Ripple were pre-mined which indicates that there was no creation of Ripple coins but rather a dazzling and dynamic introduction directly into the markets. Ripple has built its popularity and has set itself a considerable position away from bitcoins and other altcoins.
So far, Ripple has only witnessed success in its journey. It has made itself the most enticing digital currency the market could offer. When it comes to ranking, it is the third-largest cryptocurrency in the overall market cap. It had a market cap of I.2 million dollars.
Launched in 2011, Litecoin has followed the footsteps of Bitcoin which has led to the title of ‘Silver to Bitcoin’s golf’
The cryptocurrency was created by a former Google engineer, Charlie Lee. The coin has the features of an open source payment network that is not controlled by central authorities.
The Litecoin might have followed the path of Bitcoins but it obviously has its differences. Litecoins offer a faster transaction as well as confirmation time. Other than just trading, there are many people who accept Litecoins as actually currencies. Litecoin had a market cap of a smooth $3.0 billion. Ranking wise, it is the sixth largest cryptocurrency in the world.
The popularity that Tether had achieved made news and generated whispers throughout the globe. Tether had also been titled as ‘stablecoins’ because it always it always hit the market to a point which reduced volatility.
All the other cryptocurrency have high and in fact extremely dramatic volatility. Thether does have price fluctuations but they are rather smooth.
It is a blockchain enabled platform and aims to facilitate the distribution of flat currencies. The technology is developed s that the user can transact in his/her traditional currencies which would indirectly minimize volatility.
Ranking wise, tether is the fourth largest cryptocurrency by the market cap. Its total market cap comes to $4.6 billion.
It is a hyped cryptocurrency at some periods of the year. The launch for the Libra tokens have been rumored to be in 2020. Libra has been started by facebook and will be known as its subsidiary. It is an obvious thing that this cryptocurrency will be one of the most popular currency and will turn the worlds eyes towards it. Facebook is likely to use its social media power and reach to make this a huge success.
Monero is one of the untraceable altcoin. It is private and highly secure. The cryptocurrency was launched in April 2014 and spiked great interest among the markets. Monera has developed its reputation and fame in the markets due to its security assurances. Monera had a market cap of $994 million.
There are more than thousand altcoins in the cryptocurrency markets. All of them are looking to expand the boundaries of the markets and take it to another level. Altcoins are one of the most influential currencies which are used to achieve this goal. …