Bitcoin continues to be the subject of controversy among both educated financiers and the public. Some believe crypto will one day replace both fiat and credit cards and stand as the financial king of the monetary arena. Others, however, are convinced that digital assets will disappear faster than we expect – a one-time fad that will run its course and eventually die out.
Jump and Fall, Jump and Fall
One of the big arguments against virtual money is its volatility. Cryptocurrency is known for swinging up and down in impressive fashion. Last year, bitcoin rose all the way up to $19,000 – its highest position in history, while other entities, like Ethereum, were trading for roughly $1,400. The crypto market felt rock solid, and investors were feeling proud of themselves…
But since January of this year, crypto has been sinking deeper and deeper into oblivion. Bitcoin, for example, has lost over 70 percent of its value, and is now trading for about $6,400 at press time. Ethereum, on the other hand, has done even worse, losing more than 80 percent in the past eight months and trading for roughly $274. These are massive losses to contend with, and many investors are turning their backs on crypto for good.
Do Your Homework
Several former traders admit that they got caught up in the hype surrounding crypto and didn’t bother to do the proper research before getting involved. One man – Pete Roberts of Nottingham, England – claims to be one such person. He invested roughly $23,000 of his personal savings in digital tokens last year when they were at their highest points, only to see his investments fall to about $4,000. Now, he’s just trying to stay afloat as best he can.
“I got too caught up in the fear of missing out and trying to make a quick buck,” he admits. “The losses have pretty much left me financially ruined.”
This Is Happening Everywhere
Sadly, this is just one corner of the world. The drops are affecting people on a global scale, and countries like South Korea – a one-time major bitcoin haven – has seen a massive slump in both cryptocurrency interest and activity over the past few months.
Coinone, for example, is one of South Korea’s largest digital exchanges. Employee Yu Ji-Hoon says that the falls in token prices have greatly affected business, and that customers are disappearing on a regular basis. Last week, the company only saw person enter its offices for a two-hour meeting.
“The prices of the digital tokens have fallen so much that people seem to feel upset,” she states.
All That Money… Gone
No doubt, the public is feeling the pain. 45-year-old teacher and mother Kim Hyon-jeong lives on the outskirts of Seoul. She says she invested approximately $90,000 USD in cryptocurrencies last fall, utilizing her personal savings, an insurance policy, and even a private bank loan of roughly $25,000 to hit that figure. She says her investments have now dropped down to about $10,000.
“I thought cryptocurrencies would be the one and only breakthrough for ordinary, hardworking people like us. I thought my family and I could escape hardship and live more comfortably, but it turned out to be the other way around.”
It’s Not the Money… It’s the Technology
While some have been affected by the drops in cryptocurrency prices, others have managed to pull their weight, but cast doubts on the technology behind digital tokens. Charles Herman, for instance, is a 29-year-old small business owner in South Carolina. He says he’s wasted almost an entire year of his life playing the cryptocurrency market. While he’s earned back the $4,000 he initially put in, he believes the promises of financial revolution cryptocurrencies offer are false.
“I guess I thought we were ‘sticking it to the man’ when I got on board, but I think ‘the man’ had already caught on and had an exit strategy. I think I’d like to see most alts go to zero before I feel like the whole space isn’t overpriced. We also saw that bitcoin isn’t ready for mass adoption and day-to-day use.”