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Cryptocurrency remains one of the biggest innovations in global finance, even as Bitcoin prices continue to suffer following the bubble burst of 2018 and early 2019. Cryptocurrencies are decentralized money; they’re a new class of asset that’s not issued by a centralized state or bank. Cryptocurrency prices are not subject to the same laws as fiat currencies, and they can be traded across national borders without direct regulation in many cases.
Cryptocurrencies have brought about many other kinds of digital assets. There are utility coins, governance tokens, tokenized physical assets (like houses, paintings, and the like) and many more. Cryptocurrencies proper are limited to the digital assets that are used as digital money (Bitcoin BTC, Bitcoin Cash, Litecoin, etc.), though for the purposes of this article we will be calling all digital assets traded on cryptocurrency exchanges like Binance “cryptocurrencies”.
We’re writing this cryptocurrency price guide in late February 2019. At the time of this writing, cryptocurrency values are starting to rise after more than 12 months of downward price action. During this crypto “bear market” many said that the end of cryptocurrency was here, and that assets like Bitcoin were a burst bubble that would never return. Despite recent cryptocurrency worth gains, no one can say for sure that the upward momentum of cryptocurrency today will continue into the distant future.
However, we’re optimistic about the future of cryptocurrency. We think there is very good argument to be made for the longevity of this new asset class, and we’ll try to make it for you here today. When we talk about cryptocurrency predictions and cryptocurrency price predictions, we’ll be talking about the total market cap of all of these digital assets put together, though sometimes we’ll discuss the market cap of individual assets like Bitcoin.
Enough explanation, let’s get into our cryptocurrency price predictions for 2019 and the years to follow.
Why Cryptocurrency Prices Rise and Fall
Cryptocurrency prices vary according to the forces of supply and demand. For those who are unfamiliar, “supply” pertains to the number of a certain asset that is available for purchase in a given market. When an asset is very desirable, people buy it up, thus lowering the supply. The now-rare asset is worth more to the people who remain. Thus, when Supply is high, Demand is low; and when Demand in low, Supply is High.
All this means that when a lot of people want to buy cryptocurrency, the price of popular cryptocurrencies is driven upward. But what makes someone want to buy into these experimental digital markets? Well, it all relates to the tangible and ostensible “use cases” of these various cryptocurrencies.
A “use case” is the purpose (or purposes) for which a cryptocurrency can be used. Bitcoin BTC’s use case is being accepted as money by retailers on the internet and in the real world. Bitcoin is digital cash. For a cryptocurrency like NEO, there are many use cases, such as a holder being able to vote on the NEO blockchain, receive NEO GAS as dividends, store value, and trade against other assets.
Cryptocurrency prices are also related to advancements that occur within each individual cryptocurrency’s development and global adoption. Cryptocurrencies are based on software. Unlike software that is released as a product and never updated, active projects like Bitcoin are continually updated by developers around the world. What we call “Bitcoin” is a piece of software operated by Bitcoin miners and other power users. When a new version of the Bitcoin software is agreed upon by the community, this new software becomes “Bitcoin”. Cryptocurrencies that demonstrate positive development become attractive to investors, and therefore see appreciation in value.
Cryptocurrencies also receive partnerships and advancements within global industry. For example, a major retailer might announce that it will now accept Bitcoin as money for the first time. This theoretically might introduce BTC to millions of new customers. Investors will see this, rightly assume that this will advance the cause of Bitcoin, and determine that Bitcoin is now worth more than the price for which it is currently trading. Traders will be willing to pay more for Bitcoin, and this will drive the price of BTC skyward.
There are more factors that determine the price of cryptocurrencies. In every case, investors are trying to figure out which intangible factors affect the intangible inherent value of a cryptocurrency. They’re trying to “buy low, sell high”. All traders within a cryptocurrency market rarely agree all at once, so prices shoot up and down little by little. In the long run, though, markets determine the inherent value of a cryptocurrency, and determine its long term price growth or decline.
Cryptocurrency Historical Prices
“Cryptocurrency” used to be embodied by a single digital asset: Bitcoin. When it was first mined in 2009, Bitcoin was traded for fractions of a penny, and the entire “market capitalization” of the cryptocurrency industry totaled just a few dollars. In the years to come, new cryptocurrencies were introduced to the industry. Bitcoin prices rose to pennies, then dollars, and people started to think that this whole “cryptocurrency” thing might be a novel market sector and not just internet “play money”.
When Coin Market Cap started keeping track of the crypto markets in mid 2013, the total industry market cap was already above $1 billion in value. This was not enough to dazzle the world just yet, but cryptocurrency was just starting to make the news for the first time. The markets continued to hover between $1 and $10 billion until about mid-2016. Then began a truly historic market value increase, one that would shock and amaze investors everyone.
In 2017, the total value of the industry went from $17 billion to almost $800 billion in just 12 months. Bitcoin sat atop the market for this entire period. And though cryptocurrency prices fell abruptly in 2018, the entire market still sits well above its pre-bubble levels. The only question that remains is: what will cryptocurrency prices do in the months and years to come?
Cryptocurrency Future Price Predictions
Cryptocurrency Prices in 2019
We firmly believe that cryptocurrency prices will recover impressively in 2019. In fact, this may already be in motion. It’s late February, and we’ve seen billions added to the market in recent days. We’re not ready to say that Bitcoin will hit previous all-time highs in 2019, but it may get awfully close.
We’ve been impressed in the development that has quietly occurred during the crypto bear markets of 2018 and early 2019. Though cryptocurrency valuations have been in bargain basement territory, it’s easier to use cryptocurrencies like Bitcoin than ever before. Therefore, we believe that by year’s end, the cryptocurrency markets will be worth…
Cryptocurrency Prices in 2020
The way we imagine it, cryptocurrency values will be primed for a major market increase at the beginning of 2020. By this point, the world will be paying attention to what’s going on with Bitcoin again. Bitcoin will be available through multiple different applications, both as a currency and investment asset. Institutional money will be entering the space by the billion, through custodial options offered by the likes of Coinbase. Numerous altcoins will offer new applications to a wide array of investors and global internet users. For many, various blockchain networks will act as a service layer beneath all kinds of everyday apps and services. By 2020, that cryptocurrency is a new global phenomenon will be a moot point. We won’t be anticipating the crypto revolution; we’ll be living in it. By 2020 year’s end, cryptocurrency market prices will be driven to…
Cryptocurrency Prices in 2021 and Beyond
By 2021, cryptocurrencies and various altcoins will be widely traded among retail and institutional investors. Companies like Ripple, Bitcoin, NEO, Ethereum, Stellar (and dozens more) will be becoming household names, and your parents and grandparents will start to buy up digital assets and cryptocurrencies for their investment portfolios. We don’t think the crypto markets will have reached their peak in 2021. That won’t come until 2025 or thereafter. By then, “cryptocurrency” will likely be an antiquated term, as digital assets will have blurred with all kinds of market sectors almost completely. However, insofar as cryptocurrency remains a distinct sector in 2021, it will be worth
$3-$5 Trillion, with a lot more growth to come.
Cryptocurrency is a fascinating and divisive subject. But even as many have announced the “Death of Bitcoin” countless times over the years, this market segment just keeps growing. It only stands to reason that, just as the internet grew by leaps and bounds in the previous decade, digital financial and service applications will grow as well. We’re particular interested in those not dependent upon the centralized client-server model led by last-generation’s innovators (Google, Facebook, Ebay, etc.). The next generation of the internet will be led by decentralized applications and assets, and the cryptocurrency markets will be the central value proposition of this movement.