Cryptocurrencies, especially Bitcoin, have experienced a steady rise in their market value, reaching new all-time highs. In Bitcoin’s case, its market value is slowly getting close to 20,000 dollars per BTC, despite not being so steady in the past. However, to comprehend how troublesome the market for cryptocurrencies are, let’s take a quick look at 2018: Bitcoin’s trade value was close to 13,000 dollars per coin after it reached an all-time high of around 19,000 dollars, then it lost around three-quarters of its value down to 3,400 dollars, and it all happened in the same year. Trading and investing in crypto happens on regulated platforms such as the Bitcoin Profit crypto trading app.
Though there are many ups and downs with crypto, it’s still in its infancy, and it’s constantly evolving, thus the difficulty in predicting where things are headed long-term. Investors are now asking the question of how digital currencies will fly in the future and where the industry is headed. People are also wondering what changes are on the way for Bitcoin and cryptocurrencies in general at large.
Institutional Investors Getting Involved
Even though there are many cases where the trade figures are down for various individual investors, institutions are slowly climbing up the leaderboards in a significant way, and it’s all happening for the first time. Compared to most individual investors, institutional investors allow for larger trading volumes, which means that even if there are only a few trading partners, the cryptocurrency industry can still sustain itself.
Furthermore, numerous crypto developments are predicted to take place in 2021, and that could have a significant impact on institutional participation in regards to the cryptocurrency market. For instance, if cryptocurrency floats in any of the crypto exchange platforms, digital currencies will immediately get a boost in their reputation, thus resulting in a boost in their market value as well.
Regulations For Cryptocurrencies
There is always a discussion of whether to regulate cryptocurrencies or not. Lawmakers across the world are trying to figure out the necessary guidelines or laws to make cryptos safer for investors while making them less appealing to cybercriminals. To most people, the regulation for cryptocurrencies is probably one of the most extended discussions ever, but similar to most things, regulations come with numerous obstacles.
The Volatility of Crypto
Cryptocurrencies, especially Bitcoin, have a high volatility rate, which means their market value could surge at any given moment, then would suddenly plummet to disappointing numbers. However, crypto’s volatility is one of the main reasons why investors are still invested in the game and playing a steady long game. Because they are buying crypto for the potential of its long-term growth, so they don’t worry about short-term swings in its market value.
The Top Cryptocurrencies Will Continue to Dominate
The liquidity of cryptocurrencies will surge as more institutional investors buy and sell cryptos in large amounts, unlike the retail investors, who only tend to buy and hold digital assets for long periods. However, the top cryptocurrencies, such as Bitcoin and Ethereum, will continue to dominate for large investors as they have the most maturity to take on institutional investors.
What We Know That’s Certain
Though it’s quite hard to know which, if any, of the digital currencies will go through dramatic changes in regards to their prices in the following years, certainly, cryptocurrency is here to stay. On the other hand, Blockchain, the technology behind the majority of cryptocurrencies, has spread far outside that it’s not limited anymore to cryptocurrencies, and it’s more likely to see more applications in the following years.
The future outlook of cryptocurrencies, in general, is still very much in question by many people. Followers and supporters of cryptocurrency still see the unlimited potential of it and its accompanying technology, while critics only see the risks when getting involved. However, if you’ve done your research about cryptocurrencies and their market, then you’ll know that managing the risks is the first thing to think about. And all that is working with crypto understands that it’s important to have a clear path of action for all kinds of situations.