Today in the morning, for the first time since January 15, cryptocurrency markets demonstrate growth. Bitcoin price, after the yesterday’s fall below $10,000, exceeds $11,000 again. The biggest rise among top-10 cryptocurrencies shows Ripple, with 20% increase during the last 24 hours.
The latest correction has become the most lasting on the market during a long time. We can consider that correction has begun the day when the fake news about the total prohibition of digital currency trading in South Korea caused the panic on the markets. During the week’s correction which consisted of three waves, the general market capitalization of all cryptocurrencies dropped twice from its maximum of 830 billion dollars (January, 8) to 428 billion dollars yesterday. Today in the morning, when the markets have started to recover, the market value of digital currencies has increased to 580 billion dollars.
However, it is incorrect to accuse only South Korea or China in the latest market fall. It would be fair to mention that the frantic growth of Bitcoin to $20,000 in expectation of futures trading, and then the rise of altcoins to the unpredictable heights, has been too speculative.
Bitcoin, without the full acceptance of SegWit by all network members, frightens away potential users. Some of them fully (Steam) or temporally (Microsoft) exclude it from their list of the payment methods. The cause is the incredibly high commission in its network, so the payments below $100 are senseless.
As for the majority of top cryptocurrency altcoins that reached the tens of billions of dollars capitalization, they cannot boast of a working product or a sufficient number of users. Only Ethereum justifies its high capitalization, although the platform’s creator Vitalik Buterin considers that even 500-billion capitalization of the whole cryptocurrency market is inflated.
Cryptocurrency top-15 includes such doubtful coins as TRON and Cardano; the first one can “boast” of the White Paper, copy-pasted from IPFS and Filecoin; as for the second, Charlie Lee, the creator of Litecoin, expressed his doubts about it. At the same time, such project as the social platform Steemit stays absolutely underestimated. It works flawlessly during two years, has a huge user base, free and fast transactions, dozens of apps that use Steemit blockchain. However, it can change soon – the Smart Media Tokens (SMT) are being launched. They will allow creating user tokens on the Steem blockchain to monetize personal media-apps.
Many experts agree that such corrections as the latest one are useful for the cryptocurrency market since they help to clear up from the hype and frankly scam projects. It is hard to predict the recovery of the market to the previous level – it can take from several weeks to several months. But it seems a reasonable guess that the market would manage to recover, judging by the previous corrections.