2018 Was a Bad Year for Cryptocurrencies
On December 15th, 2017 Bitcoin reached an all-time high of $19,650. Since then a lot has changed for the star crypto asset and its contemporaries — and not for the better. Currently Bitcoin is trading south of $4,000 per coin, startups that rode the wave in are starting to crash, and concerns about the security of crypto continue to rise.
While U.S. stocks started to slip into bear territory just this month, the cryptocurrency market has been bearish for all for of 2018. Although the near-$20,000 highs of last December weren’t expected to last there was some hope this summer that Bitcoin had found a natural trading level. After staying in the range of $6,200 to $6,800 for weeks, the currency broke through that floor, sending other coins into turmoil as well. If there’s any good news to be found, Ethereum (Ether) — the second-largest digital asset by market cap — has staged a bit of a rally in recent weeks. It’s currently trading at around $130, up from the $80 range it had slumped to.
Elsewhere in the industry, this year has meant trying times for crypto-related businesses. As a result 2019 could see some of these companies disappear. As former Facebook employee and blockchain advisor Anthony Maguire told Yahoo Finance, “I think you definitely will see companies go bust. Tech startups go bust all the time. Sometimes they get swept under the rug in the sense that people just forget about them.” Further adding to the problem is the number of businesses that gained funding using initial coin offerings (ICOs). According to Chepicam the site DeadCoins lists 934 assets that are no more. However this list does include all kinds of coins, including those deemed to be scams, parody projects, or were hacked.
Speaking of hacks, Forbes reports that the first three quarters of 2018 saw $927 million stolen from cryptocurrency exchanges. Presumably this would mean that the total for the year would exceed $1 billion. Meanwhile helping exchanges patch some of these vulnerabilities also proved profitable for some as The Next Web says that platform HackerOne paid out $878,504 in bug bounties this year.
All in all 2018 was far from the banner year that cryptocurrency enthusiasts would have hoped for. Of course part of that disappointment comes from the astronomical rise many currencies saw last year, which cast a shadow most assets won’t escape for some time. The good news is that, despite the troubles that some coins and companies are currently seeing, it seems likely that the cream will continue to rise to the top. In other words hopefully 2019 will bring fewer distractions for the crypto market and allow worthy assets and businesses to stand on their own.