An Opinion from the Sidelines: Cryptocurrencies May Touch the Bottom

According to Steve Strongin, an expert at Goldman Sachs Group Inc., the vast majority of the cryptocurrencies will hit zero. Strongin did not specify the timeframe but said that huge fluctuations in prices in the class of digital assets were a sign of a soap bubble.

"The high correlation between the different cryptocurrencies worries me," Strongin said. "Because of the lack of intrinsic value, the currencies that don’t survive will most likely trade to zero."

This week, the cryptomarkets have experienced chaotic sales, while the total market capitalization has fallen by 550 billion dollars. In recent days, a number of unfavorable events for digital currencies have occurred: some large banks, such as JPMorgan Chase, Bank of America, Citigroup, Lloyds Banking Group and Virgin Money, have banned the purchase of the cryptocurrency through their credit cards; the cryptocurrency market has faced constraints in India and China; Facebook and Instagram have prohibited digital currencies advertising, etc. In this regard, the most popular cryptocurrency Bitcoin has lost a quarter of its value.

Steve Strongin, however, points out that not all cryptocurrencies will disappear – there will be several leaders on the market. The price of those cryptocurrencies that will survive may still increase. But it is difficult to say exactly which digital currency will remain in the end. The expert compares the existing cryptocurrencies with the first Internet search engines, which now aren't in operation since they were replaced by more efficient systems.

Despite the pessimistic attitude to cryptocurrencies, Strongin sees the future behind the technology of blockchain, which can improve financial accounting. Though, he is afraid that this modern technology does not yet offer the speed sufficient for making market transactions.

by JustForex, 2018.02.08

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

Open Account

Get Free Analytics

* required fields
Last Articles
All Articles
Best Gold Trading Tips For Beginners
Gold is one of the most popular assets traded worldwide by investors, funds, and speculators who aim to profit from the price fluctuations or stand up against inflation. Unfortunately, many market participants fail to catch the wave and take full advantage of what the gold market can offer due to the lack of knowledge and experience. Are you planning to become the next gold trader? Learn how to trade gold in the most profitable way.
Read more
How to Become a Successful Forex Trader in Malaysia
With broad access to online brokerage services, everyone can become a trader these days. However, few people actually find success in FX. The reason might be that many of those who try trading skip some essential steps or simply do things wrong. Learn about the best ways to become a currency trader in Malaysia from this article.
Read more
How to Become a Forex Trader in Indonesia
Starting trading currencies in Indonesia is as easy as in the rest of the world. All you need to do is spend a few minutes of your time on opening a trading account and going through the verification process. However, this is hardly enough to start making money, let alone make a living out of forex trading. To learn about the best ways to trade currency in Indonesia, read this article.
Read more