While cryptocurrency market analysts and investors are optimistic that the bitcoin price will set new record highs in 2018, Wall Street consultancy firm Quinlan Associates has predicted a total collapse of the world’s flagship cryptocurrency by the end of 2018.
Bitcoin Predicted to Crash in 2018
In their 156-page report titled “Fool’s Gold: Unearthing The World of Cryptocurrency,” the firm comprehensively stated that the current bitcoin price above $14,000 is a bubble and does not reflect the true worth of the cryptocurrency. Quinlan associates argued in their write-up that the current price is unreal for bitcoin both as a store of value and a medium of exchange.
The report read:
“As an asset, we valued Bitcoin using a cost of production approach and a store of value approach, resulting in values of $2,161 and $687 respectively. To value BTC as a currency, we estimated its utilisation for both legal, retail transaction payments, as well as payments in the black market. After significant testing, we calculated the price of BTC to be $1,780.”
As a result of their research findings, the firm believes the price of bitcoin is just a flash in the pan and will crash in 2018 to the $1,800 price region if the cryptocurrency is not officially adopted as legal tender.
Quinlan also declared that the fall of bitcoin would in turn collapse the total cryptocurrency market capitalization to $223 billion which is a dreary 70 percent drop from its current position around $740 billion.
The chief executive and managing partner of Quinlan Associates, Benjamin Quinlan, told Business Insider:
“Despite fulfilling most of the characteristics of a traditional fiat currency, cryptocurrencies are largely being utilized as speculative investment assets, leading to considerable volatility in their value.”
In the short term, Quinlan Associates sees nothing but a period of a critical bloodbath for bitcoin and the crypto ecosystem as a whole. However, the firm opined that the market would be rebound after the crash to experience another period of growth triggered by cryptocurrencies with strong foundations and a clear utility.
“While we anticipate valuations to decline in the short-term in response to the widespread unwinding of the digital currency space, the price of utility cryptocurrencies is likely to recover and dominate the market in the long-term,” the report declared.
It is worth noting that this is not the first time that cryptocurrency skeptics and market analysts have painted bearish market outlooks. Back in 2017, BTCManager reported that Saxo bank predicted the price of bitcoin could drop to $1,000 following a surge to $60,000 in 2018.
FXStreet’s Tomas Salles gives a range of predictions for the digital currency, suggesting for 2018, it could go as high as $89,750 or as low as $8,073, while Gonçalo Moreira, CMT, uses Point and Figure charts to show that $98,000 is in reach for the cryptocurrency, with a worst case scenario putting BTC-USD at $4,000.
At press time, the price of bitcoin is cooling off at just above $14,000. At this point, it is unknown whether the price of the world’s flagship cryptocurrency will jump to $60,000 as predicted by Saxo bank or if the price will fall to $1,800 as per Quinlan’s forecast.
The post Quinlan Associates: Bitcoin Price will Crash to $1,800 in 2018 appeared first on BTCMANAGER.