2018 : A Tough Year for Cryptocurrencies
January 4, 2019 1:39 pm
2019 is upon us and as we look towards this new year with optimism, it’s important that we look back and reflect at the passing year.
As 2017 ended with exploding of prices in Bitcoin and other cryptocurrencies. In fact, when Bitcoin reached $20,000, each and every news outlet covered this development and it was expected that the market would continue to grow.
However, as 2018 made its appearance, the value of Bitcoin started quite strong around $16,500 mark but saw a decline by the time February arrived, dropping to $6,800. The cryptocurrency was able to recover to $11,600 briefly in March but ever since then, it remained under $10,000 for the remainder of the year. The year ended with Bitcoin trading lower than $3,800.
This drop opened the floodgate of news about the doom of Bitcoin. A lot of investors and new outlets published articles that could be interpreted as “I told you so.” It talked about how Bitcoin and other cryptocurrencies have always been a bubble and this time, digital currencies will be gone for good.
Not all was grim last year, Stable coins gained a tremendous boost in 2018 as more countries showed positive stance towards them. Tether, in particular, gained millions of dollars worth of tokens. It started the year at 27th rank and ended 2018 ranking #8 with a market cap of $2 billion.
2018 saw a steep rise in the number of decentralized apps that were developed, from 835 apps, the number of dApps grew to 2281. Developers have shown a lot of interest in creating these applications and 2019 is expected to bring even more new dApps to the market.
This one was a hit and miss. While countries such as Malta embraced cryptocurrencies, others outright banned them (India and China). Then there were other countries who put in strict regulations in place and started taxing capital gains on crypto earnings (United States, United Kingdom).
Overall, the market is maturing and it seems that sooner or later, countries across the globe will have to figure out a way to make cryptocurrencies work under their legislation.
Hacks and Security Breaches
2018 witnessed hundreds of malicious hacks, cryptojacking incidents, sim-swapping, and outright robberies. As the technology matured and the systems became more secure, hackers managed to come up with sophisticated and elaborate ways to penetrate the security.
While countries with low-cost electricity initially invited crypto miners, they soon realized that meeting the exponential rise in power demands was making it difficult to supply electricity to homes.
This resulted in separate pricing plans for crypto mining and even shutdown of several mining operations.
Furthermore, as the price of cryptocurrencies continued to drop, mining was no longer profitable for the majority of users. This resulted in people selling their mining rigs by the kilo (China).
Social Media Ban
In an attempt to save users from scams, Google and Facebook had banned cryptocurrency related advertising from their platforms. This put useful projects at the major disadvantage. However, the ban was reversed by both companies and their policies regarding crypto ads were revised. This helped create a vote of confidence about cryptocurrencies in minds of the general population.
So as we can see, the price of cryptocurrencies remained highly volatile, while the underlying technologies continued to mature and evolve. We hope that 2019 brings innovation, openness, and stability to the cryptocurrency market. We wish all the reader at CoinDelite a Happy New Year.