The cryptocurrency market capitalization has collapsed dramatically from $830 bln to $135 bln, RIA Novosti reports.
The main digital currency, Bitcoin, has plummeted below $4,000 reaching the critical minimum of $3,709 in November. Only a year ago, crypto enthusiasts had no doubt that Satoshi Nakamoto’s money would soon trade at $1 mio; however, it never crossed the $20,000 mark. As soon as the price of Bitcoin plunges below the cost of its production, the currency will fall into a death spiral. And this moment is near.
There is another important circumstance that works against Bitcoin. Cryptocurrencies were expected to become universal assets like gold. However, unlike gold, which has historically been a protective asset, Bitcoin itself is useless. It is a virtual abstract value, while gold or other precious metals can be used in industry.
In the medium term, regulators from different countries will be putting pressure on cryptocurrencies. They do not seem eager to soften the requirements to Bitcoin or its competitors.