A Volatile History for Crypto

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From time to time, an investor may revisit previous prospects to find a gem in the rough, an opportunity that many may have overlooked as market habits change and evolve, and trends have changed the way in which value is placed. One investor may regard value as something entirely different to another investor, with the term being entirely dependent on what the trader’s ultimate goals and objectives are – whether it be safe, long term options, or more volatile, short term options.

This is exaggerated when it comes to the variations between forex investors, and stock investors – although the two can be interlinked. Often the case is, the exchange rates are proportionately linked to the share price of certain businesses, with marginal gains in one, often resulting in a mirrored effect within the other. Investors with a shorter term over-riding goal, will often look to trade in the exchange markets – the results are quicker, but with that comes volatility. What makes quick incremental gains one day, may result in similar incremental losses the next – as such, it’s important to compare cryptocurrency brokers to ensure that the investor is getting good bang for their buck, given the volatile nature of the trading patterns in this area. Brokers often differ in their services and offerings – from minimum spreads, to maximum leverages, as well as the number of currency pairs and trading instruments.

That said, one investment that has been prominent for many over the past few years, notably for its volatility – is cryptocurrency.

The high risk, high reward had many interested as those who were able to get involved early found a huge gain, and those a little later found despair as pricing across crypto would yo-yo very quickly – so how are the big three cryptocurrencies performing, and do we still see the same level of market volatility?

Bitcoin – The biggest and most notable, it’s impossible to talk about cryptocurrencies without talking about Bitcoin. Sparking a global craze when prices peaked in late 2017 at nearly $20,000/coin, many tried to jump on the bandwagon and sales of gaming computers and high end graphics cards soared as those looking to make a quick turnaround invested big.

(Taken from uk.advfn.com)


And the historical pricing chart says it all – for those looking to have a short-term investment quickly found that this was not a safe way to do so. We do find periods where the price is able to stay stable for a short amount of time, but it is a far cry from the ideal of a safe, future currency that was touted during the peak of interest.

Ethereum – The second largest of the crypto’s followed a similar path, finding a huge peak spike in early 2018, with small jumps here and there, but typically experiencing similar levels of volatility. As an investment opportunity, it may be considered a little safer as the cost of entry is much lower, so potential losses are also much lower – with mining efforts being much simpler and requiring much less power than bitcoin too, it seemed like a good opportunity for those that couldn’t meet the bar required by bitcoin. But once again the history of pricing for Ethereum shows a similar story, and not one that inspires confidence for those late adopters.

(Taken from uk.advfn.com)


Ripple – The last of the big 3, and the one that has the least market share, is Ripple. It isn’t one that can compete with either Bitcoin or Ethereum, as it hasn’t reached numbers close to what the others did (peaking at a little over $3 in 2018, a stark difference from the $20,000 and $1,500 of the other two) but does serve as a good reminder, and a good visual aid for those looking to get involved in the cryptocurrency market. The CEO of Ripple had announced that he was considering taking the company public, and has a long history of being able to raise money – it also adds to the list of investors looking for a payout, but with numbers still fluctuating and only steadying out toward the lower end, it could be a payout that doesn’t happen.

There was a point in time where many involved were of the belief that cryptocurrency could replace traditional currency, that it could overthrow banks and usher in a new system of monetary holding – but as experts warned as early as 2017 that this was an investment that had yet to be understood, and that we would see the bubble surrounding crypto burst. With the CEO of Ripple announcing that the firm had considered an IPO later in the year, and suggesting that other crypto-companies may follow suit, it will be interesting to see where value can be found and where returns will come from, if at all, in a market that has had historically poor periods of holding long term value.

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