Following the significant incremental rise of cryptocurrencies, their trading value has declined over the last few years – although, over the last year, Bitcoin, in particular, has seen a 78.58% rise to a £5.78k trading value, with a market cap of £104.8B. Traders have been actively looking to purchase, and as such, the market has seen a surge of 78.58% in the last 12 months.
2019 has been a year that has seen many traders attracted to crypto investment, but why is this, and are they still worth investing in?
Cryptocurrency, namely Bitcoin, first hit the market in 2009, but it was largely an unknown quantity until 2013. Following this, the forex trading market has seen monumental growth in both Bitcoin and Ethereum, and there are now more than 1,500 different variations, which have all hit the trading market in a period of fewer than five years.
The most profitable year for crypto investors was 2017, as the market cap had increased by an astonishing 4000%. In the early stages of this year, cryptocurrency was capped at around $21 billion and has now reached an estimated valuation of around $454 billion. This indicates just how much change there has been in the market value, since its inception back in 2009.
Despite this growth, speculation about the future of cryptocurrency has been rife, with many believing that it is not a sustainable investment for a wide array of reasons. However, there is little doubt that popularity is increasing, namely due to the introduction of blockchain technology. This is something that was revered recently by SFOX, who said their position on the crypto market had gone from neutral to mildly bullish, following growing enthusiasm for blockchain technology in China – a nation who have continued to invest heavily in cryptocurrency.
As mentioned earlier, Bitcoin was the first cryptocurrency to be released and is the largest, with a 40% share of the overall market. It dominates the market and continues to be hugely popular for cryptocurrency investment. The data since its inception is interesting, with some of the top bitcoin forex brokers offering dramatically changing bitcoin prices over time – from $76 in 2013 to a high of $20,000 at the end of 2017. It had then dropped to $6,000 during the early period of 2018 and has continued to drop further since then. All this change has seen several investors see their cryptocurrency portfolio grow in value, albeit if they traded on the forex market at the optimum time.
Bitcoin continues to be a fluctuating market, but many experts believe that it is a currency that’s still worth investing in if you are prepared to bide your time. Given the volatility of the market, and it’s incredibly unpredictable and fluctuating worth, it’s imperative that traders are keeping a close eye on the forex trading markets, and using previous trading patterns and price data to make educated assessments as to any potential changes in its value.
Bitcoins are in finite supply – similar to gold, for example. There is only 21 million Bitcoin in circulation, with mining becoming ever more difficult as the years go by. As with an economic transaction, supply and demand is the core determinant of value – with supply decreasing, and the enhancements of Blockchain technology increasing demand, investors appear to be less sceptical about its long-term lifespan.
Ethereum has seen a major surge since its release. By the end of 2018, it had an overall market cap of around $70 billion, with the price of one being around $720. Then, in the early period of 2019, it grew further to a price of $1,423 with a market cap of $138 billion as investors looked to add this version of crypto to their forex portfolio. This value increase of 3,000% ensured that Ethereum became the second highest-valued cryptocurrency, behind only Bitcoin.
One of the key reasons behind the growth in Ethereum was the $150 million investment it benefited from in May of 2016. This initially saw a bid price rise from just $1 up to around $15. Similar to Bitcoin, it has seen a great deal of fluctuation in its value and is incredibly volatile and unpredictable.
Despite this, Ethereum remains a very popular investment and is a more advanced blockchain project when compared to Bitcoin. This is largely because it isn’t just digital currency – seemingly a positive for traders in what is a liquid market. Market analysts have it down as one of the most likely to surge in value in the coming years, as Ethereum has announced significant plans to improve their technology. – something which could see a period of gapping on the exchanges.
Cryptocurrency remains a hugely popular form of investment with forex traders but will continue to divide opinion on its long term investment worth, security and longevity. One principal remains, however – investment in this area is a high risk given market volatility, but high reward if traded at peak times.