It has been an up and down week for Bitcoin & Co. Although the drops in value are not as dramatic as on some previous occasions, the market sentiment has been generally negative for most of 2018, compared with the euphoria of 2017. As a result, investors and industry experts have been asking what is going on with crypto and here are some of their answers.
Naeem Aslam — Chief Market Analyst at ThinkMarkets
He believes recent hacks have added a far bigger element of risk to investing in cryptocurrencies, and for the new market of traditional investors this is a big turn off.
“Exchanges are not utilising the top-notch technology to protect consumers and hackers are taking full advantage of this issue. The question is, is there any limit to these hacks? After every few months, we are seeing the same pattern emerging. This is the result of loose regulatory control and regulators must step in to protect the consumers. Anyone who wants to do with anything with exchanges should be forced to adopt high-grade security and regular security upgrades.”
Emin Gün Sirer Professor at Cornell University
He points to the recent issues over price manipulation as one of the reasons for negativity, and the fact that the crypto market has not decoupled as another. “The cryptocurrency markets are in their early stages. We know this from the fact that the coins still have not decoupled — they all move in unison, regardless of the merits of one project over another. This indicates that systemic risks to the area dominate all other concerns.”
Tom Lee Co-founder Fundstrat
The Bitcoin bull gives three reasons for the decline in the crypto markets.
“I think there are several factors why cryptos are falling. One, we had a parabolic move at the end of last year, so there is a period of consolidation and price adjustment that is taking place.
I also think bigger factors this year have been a lot of government actions that have been taken this year that have scared crypto investors, probably the most notable is the actions taken by the US regulators, like the SEC taking action against ICOs.
Lastly, the pace of institutional investor participation in this space has been taking longer than expected, and I think part of that has to do with the slowness of getting some of the onramps established.”
Crypto market sentiments may be negative, but overall, the experts do not seem to be raising any cause for alarm