As of 10:23 in the morning of October 11, 2018, nearly $13 billion worth of cryptocurrency value was lost due to the plunging value of several crypto giants. The price of Bitcoin fell by almost five percent. CNBC reports that this puts the value of the original cryptocurrency to a comparatively low $6,303. Meanwhile, for Ethereum and XRP, the losses were at over 10 percent of their previous values. It all happened within just three hours, a near-instant catastrophe that basically erased nearly $13 billion of digital coin value, putting the common crypto-entrepreneurs’ claim of a financial “safe-haven” into question.
Prior to these massive price drops, some of the biggest financial institutions in the world had already issued warnings on the potential threats posed by cryptocurrency’s rapid growth. As per the International Monetary Fund (IMF), the global crypto-asset growth spurt could usher in new vulnerabilities in the already threatened world financial system. Meanwhile, the Financial Stability Board (FSB) – the multi-organizational financial advisors to the G20 – was even more forthcoming about the negative implications of rapid crypto-asset market growth. In their report, the FSB predicts high risks of price manipulation, low market liquidity, and intensified market volatility in the near future should cryptocurrency continue its untethered evolution in the global financial market.
Out of the FSB’s predictions, perhaps the most visible implication even today is the high volatility of crypto-assets. For instance, Bitcoin’s plunge down to $6,303 per unit is a little more than 68% off of its peak value of $19,783.21 – recorded back in December 2017. And in between these periods, the premiere cryptocurrency had also displayed plenty of price shifts that have led experts to be wary of its obvious high volatility.
Here on BittPress we are far too familiar with the unpredictability of this new and disruptive digital asset. Following the explosion in cryptocurrency popularity during 2017, almost 1,000 different cryptocurrencies have already died so far in 2018. In fact, some financial experts see only a couple dozen digital tokens surviving the coming changes to the market in the coming years.
On the other hand, with all this being said, cryptocurrencies as a whole are actually showing more signs of evolution and growth rather than elimination from the global market. True to its advertised disruptive nature, cryptocurrencies have crept their way into a diverse range of potentially stable and long-term trading options. New York rental platform ManageGo is already allowing tenants to pay rent via Bitcoin. Major fashion and household items retailer Overstock famously became the first large retailer to accept cryptocurrency as payment for its e-shopping services. Additionally, CoinWire details how casinos are now using cryptocurrency, a trend that’s reinforced by the burgeoning popularity of convenient, at-home online gaming. Meanwhile, the nation of Malta in the Mediterranean Sea is already hard at work on becoming the international cryptocurrency haven of the world by releasing ‘cryptocurrency use guidelines’ for the country’s gaming industry. In relation to this, the technology that makes cryptocurrency possible in the first place – blockchain – is already finding practical uses in a number of industries, including warehousing, logistics, automotive, real estate, and the hospitality industry.
So, although cryptocurrency isn’t having a strong year, both crypto as well as blockchain are continuously expanding into different markets. Almost $13 billion lost in price plunges is certainly a big deal – but this doesn’t mean that you can count cryptocurrency out of the game just yet.