The cryptocurrency market brings together more than 800 varieties of electronic coins, with which traders earn hundreds of thousands of dollars for almost 10 years. The most popular is still bitcoin, which can bring investors more than 100% per annum. Investment exchange portal Investlb.com will tell you all about how the global cryptocurrency market is organized, how to make money on exchange rate fluctuations and to minimize the risks. Read publications of experienced traders and learn to earn on the new technological trends.
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The cryptocurrency market over the last few months of 2017 increased by more than 1.5 times, reaching a total capitalization of 100.23 billion dollars. There was no such growth in the history of cryptocurrencies. The growth driver was the bitcoin price which for 3 months rapidly increased from 800 to 2800 USD. Capitalization of cryptocurrencies on 08.06.2017 is 45.2 billion dollars., about 45%.
Not less growth is shown by Ethereum – a young cryptocurrency, created in 2015 by 21-year-old canadian programmer of Russian origin. In March 2017, the currency was worth 14-18 dollars, today it costs $ 250-255. If bitcoin had the opportunity to earn 300% profit, then the ethereum could get about 1400%. Capitalization of cryptocurrencies is the second largest — just over 24 billion USD.
Why there has been a sharp increase in the capitalization of the cryptocurrencies, and what are its prospects and is there a possibility to earn more here, read more.
How the cryptocurrency market appeared
The cryptocurrency market began to emerge after 2010. The emergence of bitcoin in 2009 was almost not seen. And even after the first transaction in 2010, (the famous and legendary history with the purchase of 2 pizzas for 10 thousand now) the progress did not happen. Only with the continued development of the blockchain technology, which began to introduce a large corporation, has an interest in cryptocurrency. Blockchain allows you to encrypt and transmit data within a single system and produce procedures for internal clearing. For clearing 4 world Bank plans to launch its own cryptocurrency.
Assessing technology, the financial community immediately rushed to make investments. The rise of prices in just a few months was around 1000%, the price rose from 130 to 1100 dollars. At this point, the market began to emerge:
- the first specialized stocks appeared, some of them were hacked and caused the fall of the rate (Mt. Gox — in 2013-2014, Bitfinex in 2016);
- the country’s leadership expressed a clear stance against bitcoin, adding moments of the treatment and taxation;
- private mining began to develop. The newcomers saw in mining the opportunity to earn money without investment, and in case of failure of the idea they would have the computer remained. That is, they have nothing to lose.
The currency is equivalent to a valuation of the goods for its subsequent exchange. Bitcoin in 2013 was not a full-fledged currency because of its growth was solely due to speculative component. As is always the case with bubbles, the sharp rise is rapidly followed by a fall. It didn’t manage to fall the bottom, but the investment has depreciated more than 5 times.
Until 2016 the coin was not so popular, but began to appear other analogs of the crypt — Litecoin, Ethereum, Monero (today there are over 100 cryptocurrencies). Investment in them has brought a small but steady income. The rise was accompanied by news about the technical side of the asset and its growth prospects. The absurdity of the speculative boom has reached the point that a new crypto projects did not differ from HYIPs with similar legends.
Finest hour of bitcoin has come in early 2016 with the collapse of the stock market in China. Even then, 90% of the volume of transactions accounted for by China, because with the fall of the Shanghai stock exchange index the number of transactions immediately increased by 7%:
- in the fall of 2015 the increase associated with construction of the new pyramid by Mavrodi. Given the capitalization of the coins it is hard to believe in this, but as a convincing explanation could not be found. Something similar is happening now;
- cryptocurrency allows anonymous withdrawal of money. With the collapse of the stock market fell oil, indices of US and Europe. Capital flight from China inflated bitcoin and the market is just warming up.
Finest hours continue in the summer of 2016. A referendum in the UK was a complete surprise, raising its quotes of bitcoin and gold. The news contributed to the start of a new strong trend that remains still. Several questions arise:
- why not follow the subsequent pullback, which took place in autumn with gold;
- why, when in the summer of 2016 happened halving (cutting the incomes of miners), did not happen the growth of capitalization. Although by the predictions it was going to happen.
Review of online quotations, similar to the situation in 2013, but on a smaller scale.
Investing in crypto currencies: what a novice investor needs to know
Features of the world cryptocurrency market:
- decentralization. The user of the system does not know which of its other participants have made the deal. All data is stored in encrypted form, the investor maintains a record of the transaction. To forge database, or destroy information on the server is impossible;
- anonymity. Nobody can calculate data about the person who commits the transaction. Information on the value of transactions is stored in an anonymous wallet, which is a random set of numbers;
- limit of emissions. The number of coins in circulation has a limitation that makes them as valuable as gold;
- profitability. A forecast in the long term is more than favorable. Even in case of a rollback after a few years the investment will bring more than 100% per annum.
To buy and withdraw bitcoin is possible through world exchange, Poloniex, Kraken, Bitstamp, etc. Online review of the dynamics of prices can be seen on the investment resources or exchanges. There are more than hundreds of stock exchanges for transactions. The transfer of money occurs through wallets, recently in Moscow there was one ATM where you can buy or sell bitcoin.
Reasons for the rise in cryptocurrency prices in the spring, according to analysts:
- recognition of coins in Japan as official means of payment. The analysis shows that the most part of transactions are concluded with Japan and China;
- the imminent establishment of the first US ETF Fund, which will invest in the cryptocurrency. While its development is hampered by the US regulators, who consider this venture a big risk.
- there is an introduction of the technology of Segregated Witness, originally intended for the bitcoin;
- artificially inflated prices by the holders of cryptocurrency, that is inflating the bubble.
- disclosure of details of the upcoming release of Metropolis. The release involves the implementation of a new concept that will allow you to create new ground rules for security contracts.
Analysts have been skeptical of the cryptocurrency. Below are a few of the opinions of analysts working in trading:
- it is a fraud, a bubble that burst, the bursting of the dot-com bubble. “Crypt” is not acting as a full-fledged means of payment, therefore its collapse — a matter of time, and the current market capitalization of visibility. Who has time to withdraw the money on the high work. Beginners who succumb to the speculative request, will suffer losses;
- “crypt” is a high-risk tool. The volatility of BTC is up to $ 200.e. and the margin on some exchanges 300-400.e. Beginners with amount of several thousand.e. in this market climb makes no sense;
- “the crypt” — it’s the future that should not be underestimated. Possible correction, but according to an analysis of the rates to levels below 1000 it will not return. Long-term investment makes sense to allocate up to 10% of the deposit;
- the market is just warming up and it will be for another 1-2 years. Given the limited emission of BTC, capitalization may increase twice by the end of 2017. A currency is a fraud, and deception leads to a loss, but BTC is already accepted by many companies Possibly on its basis a versatile tool will be created that will eventually replace Fiat money.
The cryptocurrency market is unique in that it is not subject to the laws of Economics as commodity or stock markets. The forecast is difficult, because the market operated by news and speculation. Analysis of the online quotes can show a flat, but the driver are the expectations of investors, and they are still very optimistic.
Summary. Any investment is a risk. And investment in cryptocurrency is a bigger risk than gold, currencies or securities. “Crypt” may fall at any time and create another precedent of the bubble. A historical perspective on the behavior of quotes shows that the bubbles are inflated once in 15-20 years. And if more recently, this bubble is considered a rapidly growing segment of social networking, now is cryptocurrencies. Invest or not, you decide. In the following articles we will try to further reveal the cryptocurrency.