What big events are ahead of Cryptocurrency that will challenge the market?
MtGox's ghost still haunting Cryptocurrency market. Mt. Gox trustee and bankruptcy attorney Nobuaki Kobayashi still holds the keys for market control. Though he denied the selling of $400M in BTC in last bear market January to April, 2018, people still think he has sold BTC in exchanges.
Recently, on May 10th some BTCs moved from MtGox cold wallet. It is coincidence that BTC dropped 8%. Altcoin market dropped further while STEEM dropped more than 10%.
Even if Kobayashi sold some BTC over the counter, buyers can still dump the bought BTC in the exchanges. MtGox cold wallet still hold 137891 BTC and 137891 BCH, at current price it is $1.2B. Though 17 millions BTCs are already mined and it is assumed that 4-5 millions BTCs are lost forever, 137K BTC can still crash the market.
Roughly 12-13 millions BTC are held by the investors and traders. There are roughly 16-35 millions of millionaires in the world (i.e. data varies wildly due to how it is measured). If we assume there are 20 million millionaires and each of them wants to hold 1 BTC, there is not enough BTC.
Will all the millionaire buy on average one BTC that is a big question. However, millionaire or rich investors love to diversify their portfolio with Bitcoin. Those who used Gold for hedge may switch to BTC due to its convenience. They may want to hedge 10% of their asset in BTC. Recently, a Chinese billionaire Cai Wensheng have bought 10K BTC in Q1, 2018. Therefore, it is possible that big investors, even institutes or nations may hedge some of reserve in BTC.
Still, the sheer amount of BTC in hand of MtGox trustee can still move the market in big ways if he make some bad decision such as selling big amount of BTC in exchanges or OTC buyers who intend sell it in exchanges.
Other events that may move market in big ways is strict regulation for ICOs in the western world. Another event would be strict regulation of cryptocurrency trading similar to stock market trading. It is quite possible if cryptocurrency market reach more than one trillion dollars in coming years. Then it will be too big to ignore by the Western regulators. They may chip in wrong time in strong bull market and crash the party.
However, BTC and overall cryptocurrency have survived lots of big events such as MtGox fallout, several big hacks, several bankruptcy of exchanges, Chinese ban on exchanges etc. Hopefully it will survive next big events too. However, it will wash out some junk ICOs and coin on its ways. Some well developed coins (e.g. STEEM) will come out of jungle, will see the the Sunlight (i.e. market appreciation).
Disclaimer: This opinion is not a financial advice, it my personal perspective and opinion. Please seek professionals for financial decisions.
Image sources: Most images are open sourced (e.g. Pixabay, Wikimedia etc.) with Creative common license. Some images are used with due courtesy to respected owners.
Thanks for reading.
@riseofth
Cryptominer since 2013, occasional trader and tech blogger
To listen to the audio version of this article click on the play image.
Brought to you by @tts. If you find it useful please consider upvote this reply.
This post has received a 0.39 % upvote from @drotto thanks to: @riseofth.
Congratulations! This post has been upvoted from the communal account, @minnowsupport, by riseofth from the Minnow Support Project. It's a witness project run by aggroed, ausbitbank, teamsteem, theprophet0, someguy123, neoxian, followbtcnews, and netuoso. The goal is to help Steemit grow by supporting Minnows. Please find us at the Peace, Abundance, and Liberty Network (PALnet) Discord Channel. It's a completely public and open space to all members of the Steemit community who voluntarily choose to be there.
If you would like to delegate to the Minnow Support Project you can do so by clicking on the following links: 50SP, 100SP, 250SP, 500SP, 1000SP, 5000SP.
Be sure to leave at least 50SP undelegated on your account.