Thursday, December 28, 2017

Bitcoin, Ethereum, altcoins ...: 4 reasons to invest in cryptocurrency in 2018 :

 the recent flight of the prices of cryptocurrencies should not make us forget that their course, precisely, is for the moment very volatile. Never invest the money you really need - the risk of losing a lot of money is real! Also keep in mind that to sell your Bitcoin, Ethereum or other cryptocurrencies you need people to buy them at a time T, which seems simple when the course is uptrend but can suddenly be much more complicated ( so long, which can further widen your losses) in the event of a turnaround.

It has become a star in 2017: Bitcoin has already made millionaires, even billionaires around the world. The course was indeed only a few euros in 2011, it is now more than 13,000 euros! In other words, the profitability of this investment is staggering. Yet this explosion of prices has been racing since August raising fears of a risk of speculative bubble (with the collapse that goes with it). As turbulent and volatile as it may be, the price of Bitcoin could nevertheless according to experts reach new heights, with a price that could exceed $ 100,000 in the medium-long term.

Even at current price levels, the investment still seems worth the effort. Especially since cryptocurrencies are starting to interest institutional investors and big money makers. Because more broadly the sector is in explosion. With other alternative cryptocurrencies, such as Ethereum, which can also serve as a basis for creating secure electronic contracts, and a whole host of more or less known and used altcoins. Here are some reasons to invest in the sector in 2018.

Experts predict a Bitcoin price of more than $ 100,000
If we ask the question "must we buy Bitcoin" figures of authority in the world of finance, as for example Ulrich Stephan, strategic manager at Deutsche Bank, the answer will usually be a categorical no. Yet, one can object that the same experts have accumulated huge losses in terms of opportunity cost. In other words, the hundreds of millions (even billions) of euros that they did not earn by renouncing to invest in cryptocurrencies. The bubble has been announced for a long time with so-called abyssal losses, but many people benefit and enrich themselves anyway.

This is why the voices in this area are gradually beginning to dissolve: as the interest around cryptommonies increases, a new economy is created. The term crypto-entrepreneur begins to appear, and there are already billionaires in Bitcoin, like the Winklevoss brothers, made famous by the movie The Social Network where we discover their links of enmity with Mark Zuckerberg, the creator of Facebook. One of them, already millionaire (in euros), Marc van der Chijs, predicts a flight of the courses to more than 150.000 dollars by 2021.

Credible? Finance star Michael Novogratz believes the course could exceed $ 40,000 by the end of next year. Another, Kay Van-Petersen (Saxo Bank), predicts that Bitcoin could stabilize around $ 100,000 over the next 10 years. Moreover, the year 2017 has seen an increase of nearly 1500% of its course which suggests that almost anything is possible. 

The big money rushes on Bitcoin, Ethereum and other cryptommonaies (and they believe it)
 In these conditions and after having shunned the sector since its inception, big money makers are increasingly interested in cryptocurrency and in particular Bitcoin. Sometimes to push regulations in their direction, or offer investment products modeled on the course of Bitcoin and other cryptocurrencies. What to promise mirobolant returns! But also, by injecting billions of euros, to stabilize prices at high levels.

The first futures contracts on Bitcoins are now available since early December. This means that it is now possible to invest in Bitcoin and bet on the rise or fall of its course without necessarily owning it. This type of product is obviously going to develop in the coming years, and other popular cryptocurrencies like Ethereum could also benefit. Mike Novogratz (Galaxy Investment Partners) has created his hedge fund with a target valuation of $ 500 million.

And throws in Fortune: "If people imagine that there will be a huge liquidity on Day 1, they are just wrong. It will take time to create liquidity. People have to go through at least one complete cycle to understand how this will happen. " Alistair Milne, CIO and co-founder of the Monaco-based Altana Digital Currency Fund adds: "the emergence of derivatives should have the effect of bringing much more liquidity to the market which should reduce its volatility [fluctuation brutal prices, editor's note] ". Before adding: "As the economy of cryptocurrency grows in importance, volatility should decrease."

The adoption rate of Bitcoins, Ethereum and other altcoins is still low and there is potential
For now, a handful of people - mostly investors - own most of the Bitcoins. The rate of adoption of cryptocurrency is still rather low, with estimates that expect a rate of just 2% of consumers. But the spotlight around Bitcoin and other cryptocurrencies encourages more and more people to create a portfolio and invest. The more users grab the cryptocurrency, the more stable the prices will be, and the higher the value should also go up against the good old currencies.

The value of Bitcoin is indeed based on its rarity: there is not an infinite number of Bitcoins in circulation - but 21 million. The value of each Bitcoin is linked to information on its relative price against a reference currency and on several trading platforms (the value of a Bitcoin may change depending on where it is purchased, or its course relative to a currency in which one will buy it). It is also conditioned by the demand and availability of Bitcoin. In other words, how many people are trying to get rid of it and how many people want to buy (and at what price!).

The problem today is that big players can strongly influence the course by selling massive Bitcoins. But that could change as the market becomes atomized, in other words money is held in more hands. This could accelerate as a growing number of businesses begin to offer Bitcoin as a means of payment.

Bitcoin and altcoins meet a need
There is another reason to be reassured about the prospects of Bitcoins and other cryptocurrencies: it is their usefulness. We do not really bet on monkey money. The banking system as we know it is based on foundations dating back to the 18th century. It is made up of many intermediaries supposed to assure confidence in the transactions. But the latter each time take a percentage and induce a time of treatment. This is why your transfers are not made immediately (especially to an account located in another country). That's why, too, there are fees.

Moreover the motto is a sovereign prerogative, ie as a rule the States (or regional groups like the European Union) have the hand on it, and can regulate, or use on purpose the printing press for example . This may be unpleasant for one reason or another to many actors. But there are also crises. There may be sudden price inflation. Financial transfers can be regulated or even limited as was briefly the case in Greece. Confidence in the banking system can be shaken. Bitcoin is not correlated with anything other than supply and demand ... in Bitcoins. And builds trust on complex cryptography operations.

It does not really seem a coincidence that Bitcoin was launched in 2009, after the start of the 2008 crisis. It was also at that moment that we saw the first massive account openings. Bitcoin can also make it easier to transfer money from one country to another, and at a lower cost. The blockchain system on which Bitcoin and other cryptocurrencies are based can also be used to sign electronic contracts, which could make the notary profession obsolete in the not-so-distant future.

It also has a dark side, which paradoxically confirms in the strict sense its usefulness: some states may for example suffer from financial sanctions making difficult the entry of foreign exchange (this is for example the case of North Korea). Bitcoin, Monero, or other cryptocurrencies can be an effective way to get around penalties. Bitcoin and other cryptocurrencies are also the preferred means of payment on the dark web in that it can allow under certain conditions, anonymous money transfers. It is also in Bitcoin or other cryptocurrency that hackers generally ask for the payment of ransoms ...

Of course, no one will be able to know how many cryptocurrencies you have, except in the case where a search would drop on your wallet with your private keys. This encourages many people to use it: individuals, professionals, political parties, opponents, criminals, states ... So many cross-interests that make it less and less likely a final reversal of conjecture. And that does not necessarily believe in a mere speculative bubble: because beware, yes, the price of Bitcoin and other altcoin may drop. The question that is contemporary with us is how far ... and especially how long to wait before the course climbs again!
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