Rebound of the crypto market contradicts somber predictions

Rebound of the crypto market contradicts somber predictions

Erik Finman, a teenager who got rich during the Bitcoin boom, recently issued a warning to enthusiasts of that cryptocurrency: such digital asset has a somber long-term future.

However, such an assertion occurred only hours before one of the best days of the digital market in the last year.

Bitcoin prompted the positive trend early Tuesday by raising more than 10%, from $3,260 to $ 3,600 USD, before losing a little ground.

Fears that BTC could fall below $3,000 per coin had been in full swing in recent days. It remains to be seen if this is the beginning of a long-term positive trend, but a Bitcoin bounce will always be good news for the rest of the crypto sector.

The total crypto market capitalization on Tuesday evening was of $114 billion USD, which was a gain of 10.7% from the day before. Trade volume jumped from around $10 billion to $17 billion in only 24 hours.

The sudden rise of the market was a rare coincidence with the pessimistic statement of Finman, who got involved in the digital market in 2011, when the then 13-year-old boy bought cryptocurrency with money given to him by his grandmother.

As of today, the teenager is worth about $4 million USD. However, he is now giving a pretty dark outlook to the future of Bitcoin and other cryptos, warning prospective investors that they will regret putting all of their eggs in one basket.

“Bitcoin is dead, it’s too fragmented, there’s tons of infighting I just don’t think it will last… It may have a bull market or two left in it, but long-term, it’s dead,” said Finman hours before the market rebound.

In recent days, BTC went as low as $3,126 dollars, its worst number in value in the last year, amid experts reports that it could fall below the $3,000 line prior the end of the year. However, it seems that’s not going to happen.

On the other hand, Mike Novogratz, an ex-Goldman Sachs partner and founder of crypto merchant bank Galaxy Digital, said to Bloomberg that the ICO market is “pretty much dead” right now, although it isn’t doomed.

“There was a lot of fraud, and there was a lot of hype, and people lost money. The Securities and Exchange Commission (SEC) was behind the curve, so they slammed on the brakes,” explained Novogratz. “But the SEC doesn’t want to kill this innovation.”

Novogratz believes that the ICO market is in the process of detoxifying itself, especially after an increase in scrutiny and crackdowns by the SEC.

“I think you’ll see a market for security tokens _ a real estate portfolio that gets tokenized, for example,” he explained. “These aren’t things that go from $1 to $1,000. They’re things that yield 14 percent, and they’ll be sold to qualified buyers. That sounds a heck of a lot less sexy, but you’re going to see that business grow.”

 

By Alejandro Cortés

Source: Bloomberg

  • Alejandro Cortés

    Alejandro Cortés

    Egresado de la Escuela Mexicana de Periodismo Carlos Septién García. Ha trabajado para varios periódicos en México y los Estados Unidos desde 2002.

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