Hi everyone,
In the last weeks we have been experiencing a major dip in the price of all of the major cryptocurrencies, but in the last 2-3 days we have seen many coins go up 50% from their monthly lows, so the question that many people are asking themselves at the moment is whether this is just a rebound after a huge fall or if it shows the end of what many people call the bear market.
Now, to answer this question I will address 2 points:
- SEC's intervention in the last week. While many people believe that this is a negative thing, I believe that this is great for crypto, why? you might be asking yourself. Well, the reason why I think that the SEC trying to get involved in the crypto space is a good thing is because while I believe that transactions and commerce with crypto should be unregulated (and by commerce I mean purchasing products with cryptocurrencies, not trading) I think that the actual market is very risky for newcomers and many of them see themselves involved in some sort of pump and dump scam (E-coin for example), Ponzi schemes that later on collapse (Bitconnect and DavorCoin), hype behind vaporware (Tron and Verge) or many "hot" ICOs that end up being scams. The SEC will probably protect traders against these organizations, schemes and activities, which will increase the people's confidence towards the cryptocurrency market which will probably make people stay in the space and also bring more new people (which is what crypto desperately needs, massive adoption).
- End of massive hype for "hot" and purposeless altcoins promoted by Youtubers. On December, with the huge amount of money pouring in cryptocurrencies, many Youtubers decided to take advantage of this opportunity to promote coins that they were invested in, boosting their price and in some cases creating massive pumps (Paccoin's massive price increase after JRBusiness's video is a great example of this). While it is true that we want new money to get in the cryptocurrency space, it is also true that we desperately need to educate the public about cryptocurrencies, and if at the moment that is not possible, then at least we need to protect the general public from tipsters who are able to find "hot coins" because in many cases the average Joe will get burnt. With the end of the massive bull run, the end of the Bitconnect Ponzi and the overall crypto space just calming down a little bit I think that all of us have noticed a decrease in the amount of misinforming cryptocurrency "trading tip" videos, which has a positive effect on the market because it won't make investors pour money recklessly into many crappy altcoins.
So now, to answer the question: Is this the end of the bear market or just a rebound?
I do believe that the so called "bear market" is over. Now, in my opinion there never has been one, we had Bitcoin massively overbought, reaching heights of $20k when the network had an insane amount of delayed and incomplete transactions, transaction costs were at an all time high, no scaling solutions were being implemented and the cost of producing a bitcoin in many places did not surpass the $5k or $6k mark. So now that we are back at the $8k-$9k price range I think that we are the closest we can be to the "real" price of a Bitcoin if there is such a thing to begin with.
I hope you enjoyed the post and that you have a great day. For everybody here, don't forget to HODL, we will make it far that way.
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