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Weekly Crypto Note – Crypto Winter May Come To An End

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In December 2017, the Bitcoin price scratched the $20,000 mark. The ICO hype was at its peak and produced a huge amount of new cryptocurrencies. Most of these cryptos were/are worth nothing and have largely disappeared in the meantime. In 2017, however, these new cryptos were sought-after objects of speculation. An end in itself. To buy these new cryptos you needed Bitcoins or Ethereum which in turn drove their prices up. Everyone wanted cryptos before the crash in early 2018. Crypto winter that could approach its end in 2019. The bear cycle could turn back to the bull cycle in 2019/20. There’s a lot of indication that he will. But caution is still called for. Subjunctive remains the dominant verb mode.

ICO Hype And The crypto winter

At the end of 2017, the ICO bubble burst and introduced the so-called crypto winter. In 2018, the crypto lead currency Bitcoin (BTC) constantly moved south and tested new depths. The preliminary bottom has been found to date at close to $3,200, which means that the BTC has lost almost 85% of its value since its peak in December 2017.

In the first two days of April 2019, the BTC then jumped from $4,100 to over $5,000 and has remained above this critical level ever since. The Ether (ETH) has also made an impressive recovery and is trading above the $170 mark. By mid-April 2019, crypto market capitalization across all crypto assets is just under $180 billion.

Not only the BTC price has developed encouragingly. The good companies of the crypto-universe have used the crypto-winter to push their development and expansion. Coinbase just recently announced that it will offer its crypto-to-crypto exchange services in a further 11 countries. This makes Coinbase active in 53 countries and one of the global players. With Binance and Kraken, Coinbase is the driver of the crypto trading scene.

Regulators Prepare For Crypto Spring

The progress of regulatory developments is also encouraging. The financial market supervisory authorities of most jurisdictions have now at least established a regulatory understanding of blockchains and cryptos. The regulatory nirvana of 2017 is over and so is the respective uncertainty for investors.

The ICO hype 2017 has massively challenged the regulators. In the meantime, the US Securities and Exchange Commission (SEC) in particular has developed a practical regulatory framework for the issuance of cryptos in numerous cases and clarified that it regards cryptos as securities in cases of doubt.

The eagerly awaited approval of a crypto ETF by the SEC has not yet taken place, but that seems only a matter of time. Wall Street and the financial establishment also used the crypto winter to prepare themselves and their investors for the expected crypto spring. The Financial Action Task Force (FATF) presented its guidelines regarding cryptos and Anti-Money Laundering (AML).

The development of so-called Security Token Offerings (STO) as a blockchain-based alternative to Initial Public Offerings (IPO) of shares has also progressed significantly. We, therefore, expect the first STOs in the second half of 2019, which would finally call out the crypto spring.

Crypto, Forex and Scams

The FOREX industry is eagerly awaiting the crypto spring after the ban on binary options, especially in the retail sector. And this is also where the great threat potential is to be expected. FOREX retail brokers will try to get their share of the crypto market and develop new crypto-facilitated financial products.

Already in the last months, the FinTelegram research team has determined that cryptos are used by the scams and illegal brokers as a new potential for ripping off small investors. Here we must exercise the utmost caution.

Conclusion – currently thaw with early indications of spring. However, short frost periods are still possible. April weather! Stay cautious don’t let greed eat your brain.

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