Bitcoin to hit $5,000 or $50,000?

It’s been a week to forget for the cryptocurrencies and the investors who were in search of the winning lottery ticket amongst the 1,506 cryptocurrencies to choose from.

The total market cap has slumped to $411.25bn, which is quite a fall from the market’s all time high $830.74bn hit just a few weeks ago.

Going back to the dot.com era, when the bubble burst, the total market cap of the dot.com stocks slumped by 60% over the 6-month collapse.

While the 2018 cryptomarket collapse by market cap is knocking on the door of the dot.com collapse, we’ve yet to see cryptocurrencies become worthless.

If we are talking about percentage losses, then the current slide would be considered a burst bubble in any established market, but in the cryptomarkets its somewhat different, with such an event likely to shut down many of the existing cryptocurrencies, leaving just the ones that actually feed a purpose, with the likes of Bitcoin, Ripple and even Stellar Lumen likely to survive whilst many will be forced to withdraw, virtual currency collapses leaving projects and start-ups with insufficient funding to get things off the ground.

For Bitcoin, the week has been a telling one, with a 28.31% fall certainly better than the rest of the majors, whose large declines has seen Bitcoin’s dominance rise to 35.3%.

It’s not pretty viewing however, with Bitcoin’s market cap now down to $143.75bn and today’s 7.29% fall to $8,343.14 putting investor resilience to the test.

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It was only a matter of time before the cryptomarkets got its true test and this looks to be it. Bitcoin has a long way to go before it is wiped out and, when considering the fact that it is already being used as an alternative to fiat currency, its survival is likely for now.

Over the longer-term however, its functionality may be brought into question and if the cryptomarket does burst and leave many cryptocurrencies worthless, the markets may finally shift focus to functionality and whether the product offering is a viable one that can survive in the real world.

Forks and all may not be enough for Bitcoin, with the likes of Bitcoin Cash already in existence and ready to step into Bitcoin’s shoes.

The rise and fall has been so rapid, that a shakeup in the cryptomarket may just be around the corner. Governments and regulators in key cryptomarkets have stepped up the fight and are ready to put out any flames of resistance, with the regulatory oversight that is on the horizon expected to wipe out all of the dirty money that has been washing around the system.

It may be tough times for the cryptomarkets, but they are also interesting times, with how events unfold in the coming weeks likely to define the market over the long term.

For the day ahead, Bitcoin is likely to continue to struggle, with this morning’s intraday low $8,314.1 in sight. Investors have little to go on, with the Cboe Bitcoin Futures price providing little guidance on what’s on the horizon for Bitcoin and the market in general.

While it’s looking a little dire for Bitcoin, the competition is seeing more heavy losses and we will expect Bitcoin dominance to continue to rise as investors, who are looking to maintain exposure to the market, rotate out of the altcoins and into Bitcoin, while the rest look for the door.

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