Cryptocurrency

The latest Cryptocurrency trends for the last quarter of 2019

It’s been ten years since the inauguration of the first cryptocurrency, Bitcoin, and the world is still striving to find ways of best utilizing this digital representation of value that is decentralized in nature. Different entities are working around the clock to find solutions to challenges presented by the first generation of crypto, such as volatility in prices. As of October 2019, there were approximately 2969 cryptocurrencies traded on different exchange platforms, with a market capitalization of roughly $222 B. 
Unraveled below are the latest most notable swings in the cryptocurrency arena for that last quarter of 2019.

  1. Bitcoin is still the best performing asset despite a plunge in its price experienced in the past quarters

The third quarter of 2019 was marked by a decline in the value of Bitcoin. The pioneer crypto coin suffered a go down of more than 25%. Having hit a high of approximately $13800 in the second quarter, Bitcoin experienced a pullback to roughly $9100 at the beginning of the third quarter and touched a low of $8200 at the end of the same quarter. However, despite suffering a decline in value, Bitcoin still maintained dominance and was still the most traded asset in most cryptocurrency exchanges.

  1. Cryptocurrencies are still speculative assets due to their dramatic swings in prices

Ten years down the line, cryptocurrencies remain to be risky assets; crypto investors are still betting on the market behavior of the digital assets. Cryptocurrencies are still experiencing dramatic swings in their prices, making many merchants and consumers shun it as a means of transaction. The high volatility depicted by crypto coins paints them as a poor store of value, making them unattractive for most parties to embrace them as a means of payment for goods and services. 

  1. Libra is widening the conversation about what money really entails

On June 18, 2019, Facebook announced that they would be introducing a new cryptocurrency in 2020-Libra. Backed up by other Silicon Valley top companies, including eBay, Mastercard, and PayPal, Libra continues to drive serious conversations from leading financial stakeholders about what money really entails. Based on the billions of people utilizing the Facebook platform, Libra could be the first cryptocurrency to be encountered by billions of users. The big question is, will Libra mark the end of the centralized state currencies?

  1. The demand for gold has not been adversely affected by the need for cryptocurrencies

Despite cryptocurrencies being viewed as ‘gold’ by the current generation, the real gold continues to enjoy high demand. A factor that can be highly attributed to the stability in the value of the latter compared to that of the virtual coins. 

  1. Asset-backed stablecoins and algorithmic stablecoins

Finally, to address the issue of price volatility witnessed in the first generation of cryptocurrencies, stablecoins, and algorithmic stablecoins are gaining more popularity. They are digital tokens whose values are pegged to a fiat currency, which act as a control mechanism against the dynamic value characterizing the first generation of crypto coins.