The worst bubble ever? The tragedy of digital currency worse than the internet of 2000
Tracking the digital asset index of ten digital currency, such as bitcoin cryptocurrency since January this year, the data showed the index has plummeted down 80%. When the Internet bubble burst in 2000, the Nasdaq Composite Index fell by 78% from the peak to the bottom.
This year, the global cryptocurrency has fallen over and over again, which may be worse than the burst of the Internet bubble at the beginning of this century.
Coinmarketcap, a website that tracks multiple trading platforms and multiple digital currencies, showed that the overall market value of global digital currencies exceeded $813 billion in early January this year, and now it is less than $190 billion, a sharp drop of more than 76%.
Excluding Bitcoin, the current market value of all other digital currencies is less than $80 billion, which is more than 85% lower than the market value of nearly $538 billion in January.
The reporter mentioned ealier that among the seven largest digital currencies with the highest market value, six fell by more than 77% relative to their respective peaks, and only Bitcoin fell below this figure, a drop of 68%. The leading Ethereum market price fell not only from the highest peak of $1419 this year, but also returned to the level of 15 months ago.
Neil Wilson, chief market analyst at Forex trading platform Market.com, commented that the plunge showed that the entire digital currency is a huge speculative bubble, which is likely to be a winter that swept the entire market. Bitcoin is currently the most likely.
“The blockchain space is approaching the ceiling. If you talk to a generally educated person, they may have heard of the blockchain at least once. Nothing in this area has a thousand times more growth opportunities.”
Vitalik also pointed out that the growth of Bitcoin and other digital currencies six to seven years ago actually benefited from marketing, and "this strategy is approaching a dead end."
Last weekend, the US Securities and Exchange Commission suspended two popular exchange-traded notes (ETN) transactions that track Bitcoin and Ethereum, respectively, because market participants are still confused about these products.
On Monday, Business Insider reported that Citigroup has created an ADR-like product called "Digital Asset Credentials". If it succeeded in launch, it will provide institutional investors with a low-risk way to participate in the digital currency market.
However, the above news does not seem to offset the negative impact of the SEC's actions. The digital currency that has fallen into a bear market fell further this week.
CoinDesk reports that Bitcoin seems to be replicating the route on the eve of the September 2015 reversal. As of current from this year, the trend is similar to the period before September 2015. But on July 6, 2015, Bitcoin rose upon the downtrend line, but this year it failed to break through that line, so whether it can break through $8500 may be the key.
The author believed that cryptocurreny fell worse than the burst of internet bubble but still there are bullish sentiments. Internet's Nasdaq Composite Index reached the highest level after 15 years ago of the collapse and since then internet has made great impact on our society. They believe that Bitcoin historical data showed that it has also experienced a big drop and a big rebound before. But even if the optimists say it, the final digital currency will change the world. The sell-off in this year also highlights that such progress cannot be smooth.