This year has been significantly different to last year when it comes to the performance of cryptocurrencies. We have repeatedly watched the value of major cryptocurrencies; including top dog, Bitcoin drop to all time lows.
Volatility is par of the course and it is something that investors have come to expect, so falls like this are often taken in their stride; however, in another show of just how volatile the price can be, this past month has seen the value of cryptocurrencies peak again – gain 60% of their value over a period of just two weeks.
Some of the largest cryptocurrencies saw even bigger gains, with IOTA gaining a whopping 115%. Other major cryptocurrencies that performed extremely well over this two week period included Stellar, which was up be 111%, Ripple by 102% and EOS which saw a rise of 101%.
You will notice that some of the largest cryptocurrencies are absent from this list; notably Bitcoin. Although the worlds largest cryptocurrency did experience an increase, it stood at just 35% over this two week period, which is far lower than some of its peers.
The question on everybody’s list is why they are seeing such an increase, after experiencing huge losses overall this year. It could be down to a combination of three factors. Blockchain is finally getting some acceptance and real-world action. Without blockchain, there would be no cryptocurrencies, but it also the biggest source of concern. As it stands, there are very few large businesses who are willing to test the technology in real life scenarios, and this could be one of the biggest set backs. But in recent days, there have been a number of great blockchain projects that have gone live, which have attracted the attention of major companies.
Another contributing factor is that the stock market has stabilised recently. Last year, people were of the belief that digital tokens could act as an alternative to the stock market. However; it was a different story at the beginning of this year. For the first time in two years, the stock market entered correction territory back in February. This meant that the virtual currencies sank, alongside traditional entities, dispelling the myth that they could act as an alternative to the stock market. The stock market is stating to pick up again now, which means alongside this, the cryptocurrency market has also.
Finally, retail investors are happy once again. Retail investors are more prone to invest based on emotion, as opposed to logic, which can affect the volatility of the market, driving the price up and down considerably. When they are happy and investing in the market, the prices will go up, and we will see huge gains like we have done over the two weeks in question.
Source: Read Full Article