Between yesterday and today, Bitcoin had been riding high compared to its recent lows, with a consistent price point around $7,000. As of about 6 AM EST, however, all of the top ten cryptocurrencies have been falling, with Bitcoin losing about $500 in what was roughly a six hour period.
The prevailing opinion of the press, including Cointelegraph, seems to be that the recent postponement of the SEC’s upcoming decision on whether or not to allow the listing and trading of a Bitcoin ETF is to blame for this new volatility. In attempting to back this up, Cointelegraph also cited the fact that the entire market has lost around $15 billion of its value in the last day.
Such an opinion is not a fallacy, but based on the history of the movements of the Crypto market, such events are not uncommon.
All in all, what this news primarily does is once again bring to light a phenomenon of sorts that has arguably been true for quite some time.
Until the Blockchain industry the proves wider utility or usefulness of the Blockchain and Cryptocurrencies through real partnerships that affect people’s lives for the better, the entire Blockchain market will continue to move based on speculative events.
What do we mean by this?
A speculative event can be anything for which the conclusion has not been determined and yet, even so, investors act like it already has been determined. Think about this in the same way as it plays out in the traditional finance industry.
Some stocks are truly speculative because they have not proven their usage over the long term.
Sometimes, the situation is even simpler than that and a stock can begin by being speculative for the first few years of its existence, until the company behind it is considered trustworthy.
As trust is a keyword in the Blockchain world, we’ll stick with that point for now. To decrease speculation and therefore decrease market volatility, we need to spread and increase public trust in Blockchain technology.
Going back to earlier points, this begins with real partnerships that actually affect peoples’ lives. What this, on the other hand, does not involve is more pilots.
In short, it all comes down to working products that a large group of consumers actually need and can actively experience, as soon as possible.
By: BGN Editorial Staff