Business Wire reported on Oct. 9 that Juniper Research, a UK-based research firm, released a report stating that Bitcoin’s price not only has plummeted since the beginning of the year but also has failed to take advantage of ongoing US–China trade wars, weak fiat currencies, and Brexit uncertainty. The report, entitled “The Future of Cryptocurrency: Bitcoin & Altcoin Trends & Challenges 2018–2023,” further claims that if Bitcoin fails to recover on such favorable conditions, how can it recover when the conditions change for the better?
The same report also highlighted that the daily transaction volume is down to 230,000 in Sept. 2018 from as high as 360,000 in late 2017.
Bitcoin’s Favorable Conditions Which It Should Have Capitalized On
Despite a slow start to the year because of uncertainty in regulation, Bitcoin was handed a lifeline by some negative economic developments as the year progressed.
Firstly, it was the collapse and weakening of fiat currencies, and this was expected to work directly in favor of cryptocurrencies. Venezuela introduced a national cryptocurrency backed by oil and natural resources as a countermeasure to hyperinflation, which had eroded the country’s fiat currency. In August, the country reformed its financial system by introducing a new currency denomination, the bolivar sovereign, which is closely tied to the defunct bolivar but had fewer zeros.
Still, in South America, Argentina’s currency, the peso, has lost more than half of its value since the beginning of the year because of runaway hyperinflation, fiscal deficit, and debt obligations.
Other currencies that have weakened this year include Mexico’s peso, Russia’s rubble, Turkey’s lira, Brazil’s real, India’s rupee, and South Africa’s rand.
In June, US President Donald Trump accused China of intellectual property theft in a White House statement and imposed “a 25 percent tariff on $50 billion of goods from China that contain industrially significant technologies.”
Trump warned China against retaliation. China, unfazed by Trump’s threats, accused Trump of triggering “the largest trade war in economic history” and retaliated by taking similar countermeasures on US imports. The trade wars will slow down world economic growth, which was projected by the International Monetary Fund to expand by 3.9 percent in 2018 and 2019.
Another big issue this year is Brexit and the effects of its uncertainty in the UK and the eurozone. It will have implications for both the UK and Europe at large. For example, a bad Brexit deal will put 40,000 automotive jobs at risk.
Bubble in the Making
The study also questioned the prospects of Bitcoin in the future because of strict regulatory measures and how the cryptocurrency is evaluated. In the report, Dr. Windsor Holden said:
“Bitcoin has no intrinsic value. Like any asset, it is worth whatever someone is prepared to pay for it, but it has no meaning or existence beyond the confines of the ledger. It is a bubble, and there is a strong possibility that this bubble could burst in the near future.”
Report: Bitcoin Fails to Capitalize on Pressing World Economic Issues – Odds Don’t Look So Favorable in the Future was originally found on [blokt] – Blockchain, Bitcoin & Cryptocurrency News.