The year 2018 has been a roller coaster ride for investors and enthusiasts alike. With a massive surge in crypto prices at the same time last year, many were optimistic about the cost of bitcoin and other cryptos to go further up. However, we are in the last phase of December 2018 with new year knocking on the doors, and the optimism about Bitcoin prices is slowly dying down
In November 2017 the talk of the town was the crypto trade market and how it would be one of the most significant trading assets. However, in 2018 the debate has slightly shifted from the price and trade market towards implementation of blockchain beyond cryptocurrencies. So, what changed in one year, has the crypto price bubble busted? We will try to answer all these questions and look at the value of Bitcoin beyond the bubble.
What is the Real Value of Bitcoin in 2018?
When Bitcoin first came to the forefront in 2008, many people were buzzing about it regardless of their understanding of the concept. Within a decade, the asset value of the digital money surpassed the amount of gold, and everyone dived in. However, the asset valuation overshadowed the real world use case of the blockchain.
When Satoshi published the white paper, his main focus was to make people aware of the value of decentralization. He wanted to tell people, look we can create a system of peer-to-peer network, where nobody has to trust a third party to keep their money safe, and the technology behind it is years ahead of the current form of systems in use.
However, with Bitcoin touching a value of around $20,000 in late 2017 changed everything and people were more interested in the asset value of the token rather than different real-world implementation. People and experts started comparing it with the internet revolution of the 1990s, and many experts were baffled as in how it is fundamentally possible for an asset to rise without any backing in the real world. But, now that 2018 has seen new laws regarding the price, people have started to realize the real potential in the technology rather than its trade value. Different governments and institutions have begun to explore different real-world use case of the technology than solely depending on the trade market.
Post-Bubble Analysis and Comparison with dot-com Bubble
The 2018 fall of the crypto market has busted the bubble for investors, but many believe that the fall has come quite early when compared to the dot-com bubble. Well, experts think that the internet is indirectly responsible. Since the internet is in its second generation of operation, experts believe it pushed the bubble as well as busted it.
To make a parallel comparison of the two mega-events in the wake of the mayhem of the crypto trade market, NASDAQ, at its peak in 2000, fell 72 percent. Cisco, a bellwether of the technology industry, was down about 86 percent from its peak. And finally, Amazon, the biggest story of the internet age, was down by a massive 95 percent from late 1999 to late 2001, crashing from $107 to just $5.97.
So we can see from the above example that, even in the dot-com bubble, most of the big firms which came into existence, fell flat after reaching great heights. Here, the point of observation is not the fall itself but the aftermath of the fall.
People should realize that to sustain in the cutthroat business; they must have a real utility in the lives of people. For example, an online pet store in the 1990s would have died down a slow and painful death, but an online bookstore was always going to stay and look at it now, it is the second company to breach the Trillion mark. Amazon currently sells anything you can ever ask for, similarly bitcoin and other cryptos must find a real-world use at a larger scale to prevent extinction.
The real value of bitcoin is beyond the store value and the trade market prices. The current downfall might have been heartbreaking for many who joined on the bandwagon after seeing the meticulous rise. However, the above comparison between the crypto bubble and dot-com bubble makes it clear that an asset like crypto would only prevail if it can create an ecosystem based on blockchain and be universally accepted.
People must realize that the main aim for Satoshi was not to create a digital currency which can only be an asset class and used on the trade market. The focus should always be on wider acceptance rather than accumulation at the hand of few.