It is no doubt the cryptocurrency hype has come to a standstill save for sporadic news about the market. The current market decline has seen crypto critics get their voice back. This raises the questions as to whether the market leader, Bitcoin (BTC) is throwing its last kicks.
Ten years ago Bitcoin was just but an invisible coin and has since grown to a household name and a global brand. The hype was so high that it almost touched the $20,000 mark. The price surge opened the floodgates for altcoins with most of them having no market agenda.
The crypto sphere has become so much saturated that Bitcoin adoption has taken a backstage. The new platforms are coming with different propositions from vehicles of payment or investment assets. This has trimmed Bitcoin down to “just another virtual currency”.
Beating Bitcoin Inroads Globally
The market has become so competitive but with less crypto education people do not know the difference between the many cryptocurrencies, how their ecosystems work and how these can solve investor problems. This has hit Bitcoin below the belt and this has seen BTC trade below the support zones.
The Bitcoin price fluctuations which punctuated 2017 and 2018 shocked the crypto enthusiasts. The worst moment for the coin saw the coin price break below the vital support levels of $6,000, $5,000 and $3,000. The price drops are not strange in a volatile market but the BTC price swings in November appears to have shaken the investor confidence given that BTC is marketed as a store of value.
Where Bitcoin Misses the Point
It is clear that Bitcoin has never been fully utilized and the growth of the altcoin market might keep the BTC potential in the dark due to lack of scalability. What’s more; the cost of transacting on the Bitcoin platform is too high for the ordinary crypto goer. The confirmation times do not discern the user especially in an anonymous environment where trust is the only vehicle connecting the sender and receiver.
The entry of newer coins that promise to stem the market volatility will see Bitcoin start gathering dust in user wallets in the near future. Ten years since the creation of Bitcoin, not many users see it as a comfortable fiat alternative. This too has blocked high profile institutional investors keep off the market.
Bitcoin Breaking Investor Community in the Middle
Investors are not interested in hopes but what is real and practical. Already, there are two camps among Bitcoin adherents; there are those who are hanging on for the BTC potential and expected gains and the other camp that is interested in the platforms’ fundamentals and its anticipated global financial sector disruption.
There are also the internal investors; the miners who are the backbone of the Bitcoin community. This group is rewarded according to the market price and a slight dip in BTC price means their rewards dip. These rewards are also sold and the revenue goes a long way in supporting mining rigs and tools used in the process.
The recent miner closedowns is a clear indication of how the venture is not profitable. This has also seen the Bitcoin ecosystem hash rate plummet by more than 24%. The existing miners are heading to profitable assets and this might affect Bitcoin popularity.
Mining has turned to be uneconomical and when the cost of resources used is higher than the rewards, miners have no option but to down their tools. According to a report by Bloomberg, miners are not breaking even:
“The break-even cost to mine a single Bitcoin using Bitmain’s Antminer S9 rig was estimated at $7,000 in a Nov. 16 report by Fundstrat Global Advisors, though the level is probably lower for some miners with access to cheap electricity and equipment.”
The miner migration might indicate the last kicks for the market leader and this is the current worry for investors. With more promising and shinier altcoins, the old crypto investors have more options and most of them are exiting BTC to other available coins and to some extent; Fiat.