The cryptocurrency market had a stellar 2017. A good number of cryptocurrencies experienced massive price jumps. Bitcoin rose from just under $1,000 at the start of 2017 to almost breaking the $20,000 benchmark in December before sliding down again. Other cryptocurrencies like Ethereum’s ether, litecoin, and ripple also experienced a massive price increase. The hype surrounding the market reached fever pitch as a whole new set of investors thronged into the market looking for their own piece of the crypto pie.
Since the turn of the new year, the market has been undergoing a slump in the price of many cryptocurrencies. The price of bitcoin has plunged to its lowest level since November, currently below $10,000. The same can be said for Ethereum, Ripple, and many of the other top ten cryptocurrencies. Some proponents of the cryptocurrency bubble argument have been vocal in calling this slump the beginning of the end for cryptocurrencies.
Still an Infant Market
In the midst of the hype and buzz that surrounds the crypto market, the reality of the infant nature of the market can be lost on some. Bitcoin was launched in 2009, and Ethereum in 2014. The cryptocurrency trading market is much younger than the mainstream commodity trading markets. There are many aspects of the blockchain technology that haven’t been perfected yet. Problems like scalability remain a thorny issue that is affecting the effectiveness of mainstream applications of the blockchain. Bitcoin, Ethereum, NXT, and several other blockchain projects are technically still undergoing a lot of improvements. Bugs are being tested and resolved on a regular basis.
2017 saw the emergence of many ICO campaigns that were carried out to raise funds for a number of intuitive blockchain projects. Projects like EOS, Filecoin, Tezos, and Augur among others aim to create useful blockchain applications that can compete in the mainstream application market. Many of these projects are entering Alpha and Beta release modes when members of the public begin to interact first-hand with these applications.
DAO, DApps, Data Science, and The Internet of Things (IoT)
Take a survey among tech experts and enthusiasts and top on the list of exciting innovations in the works will have concepts like Artificial Intelligence (AI), the Internet of Things (IoT), and blockchain technology. In years prior, some of the concepts may have only been possible in science fiction, but they are slowly becoming a reality. AI and the IoT are thought to be pillars of the new and emerging digital environment that promises even greater connectivity. Cryptocurrencies being powered by blockchains have been identified as the likely currency of this new environment.
There is a lot going on at the intersection of blockchain technology and data science. Concepts like the DAO (Decentralized Autonomous Organization) and DApps (Decentralized Applications) have shown the immense potential that blockchains and cryptocurrencies have in bringing about the actualization of a new digital age.
Cryptocurrencies have a lot more adaptability to the emerging digital landscape than fiat money could ever possibly have. With cryptos like bitcoin, ether, and litecoin powering the new digital age, there is hardly any doubt that they will become stores of value. Mainstream acceptance of cryptocurrency payment is increasing by the day which in turn increases the sphere of influence of the crypto ecosystem.
The current stagnation of the market is indicative of a process of evolution. There are market dynamics at play that are shaping the cryptocurrency market. After a certain period, the market will resume normal service, and the upward momentum will continue. Even though a sharp correction has taken place, the fundamentals have hardly changed in the past few months; if anything, they have improved. One thing is for sure, that is the cryptocurrency journey is only just beginning.