Ethereum co-founder and founder of Cardano Charles Hoskinson predicting ten years until crypto returns to its ATH
2017 was a great year for bitcoin and cryptocurrency
By December the price had climbed to an ATH (all time high) around $20 000. Since then a bear market has set in and everyone in the industry is eagerly awaiting the turnaround and climb back up to that ATH price and beyond. If bitcoin continues as it did in previous years, this eagerly anticipated next part of the cycle should take the price way past $20 000 and up to new ATHs. Investors and traders are coming up with all sorts of potential future price heights.
And that’s what keeps us going during this current rather depressing price slump.
So when Ethereum co-founder and crypto expert Charles Hoskinson (also the founder of Cardano) makes a statement – as he did recently – that bitcoin and the crypto markets as a whole could take another ten years to reach the 2017 ATH again, we probably all find that seriously pessimistic and downright depressing. After all, according to many trading analysts it shouldn’t take more than another year or two to get us back to $20 000 bitcoin. Even if we look at the previous bull and bear cycle from 2014-2017, a three year wait is to be expected. And we have already passed the first year of the bear cycle and are approaching the bottom or accumulation phase, or so many are concluding.
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Hoskinson is basing his theory on the price history of top stock Amazon during the dot-com bubble of 2001. It took Amazon over 11 years to really return to its previous ATHs of around 2001 after the market crashed spectacularly. So by that example he reckons we still have ten years to go before we reach even $20 000 bitcoin, what to speak of far outclimbing that to way new ATHs that some are saying will peak at anything near $100 000 or even more, just as a ballpark figure.
But for Charles, bitcoin is not a stock like Amazon, nothing near it.
And according to bitcoin’s past history your theory sounds absurd. So why would a seriously expert leader in the crypto industry come up with a statement like that? Well it appears that he, like many others are convinced that crypto prices will only start climbing again once institutional investors start participating in the industry. And they will only do that when it has matured, and it will take 10 years to mature to the point where there is proper government regulation, less volatility and proper investment tools in place, like derivatives, etc.
“Institutional investors are pretty picky. They're very intelligent investors, but then they also require an ecosystem of sophisticated trading strategies and tools [...] They need derivatives, they need options, they need to get a short sell, and if our markets can get these things, what will happen is that you'll no longer see this massive volatility.”
Charles Hoskinson
One problem may be that old school mainstream investors might simply be unfamiliar with cryptocurrency at present. For example a recent study done by the Global Blockchain Business Council showed that 63% of executives barely understand what blockchain is. Even Mike Novogratz, the ex-Goldman Sachs partner and now bitcoin enthusiast said that institutional demand is what will send bitcoin to its new ATHs. But he theorises that this should occur no later than Q2 of 2019. That’s in less than six months from now. So one wonders just how seriously we should take Hoskinson’s decade long prediction. Maybe he knows something we don’t.
Well if Institutional adoption is what it will take to get the next bull market going, then hopefully we don’t have to wait another ten years.
Also discovered in the recent survey mentioned above is that 33% of economists interviewed believe that in only two years the application of blockchain in banking and other financial services, as well as in digital identity and the health care industry, will dramatically increase. Perhaps that may be enough of a catalyst. If not then surely big players like Wall Street, Morgan Stanley, Citigroup, Barclays and Goldman Sachs are already watching cryptocurrencies closely and standing on the sidelines waiting to jump in? Already some of them have digital asset divisions in their corporations. Well apparently customer adoption has been extremely slow. There is just not enough interest yet. These firms are particularly conservative with their investments, so without proper regulation in place, they won’t get involved.
Even Bakkt has been repeatedly delayed.
So it appears that it is more about government regulation being required, which will lead to institutional adoption, which will lead to price upswing in crypto and ultimately new ATHs. Well nobody really knows how long that is going to take, but I certainly don’t think we will have to wait 10 years. We really need regulators to make up their minds now as to whether bitcoin and cryptocurrencies are commodities, securities or something new altogether. Criminal cases flooding the crypto industry aren’t helping either obviously, but those too will diminish once tighter regulation falls into place. Bitcoin may be built to free us from control but without some degree of regulation it will just be a free-for-all where even criminals are free to take advantage of unsuspecting investors, and nobody wants that.
Institutional adoption may be in limbo at the moment but they are watching very closely and this bear market with its bargain prices are just too attractive to ignore.
As a result it may only take another year or two before the big investors from the likes of Wall Street, etc jump on board and add serious fuel to the bitcoin rocket as it launches its next liftoff to the moon. Of course it may be that the moon is no longer the destination. This time it may be Mars, and a way higher ATH that we can even imagine. That may take a little more than two years, but the ten years suggested by Charles Hoskinson seems like a long shot.
What do you think?
Leave your comments and projections below and let’s see just how long we will need to wait until $20 000 looks like a mere blip on the screen to $200 000.
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While the comparison to the dotcom bubble and recovery is a fair comparison, I think that the rate of change in technology (Moore’s Law) continues to accelerate the cycles. For that reason, I think it will be a a shorter time frame for a recovery. However, not all will participate as many will fail.
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Completely agree with you on this. My guesstimate is Q4 2019, or Q1 2020 for when we will see the crypto markets starting to recover and enter the next bull cycle.
This short video explains who Charles "The Money Printing Machine" Hoskinson is.
Saying something like that in a bear market while trying to sell Cardano to people, seems like a strange tactic.
Yes, it's strange to say the least. So strange that I don't even know what to make of it. Definitely a strange tactic indeed.
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We hope to see this bear market end soon
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I wish to see it stick around for a while because the lower the prices, the more coins we can buy cheap and the better we will be off when the markets finally take a turn for the better!
The crypto market is crazy but I say that a series of catalysts will set the next bull run @runicar but if history repeats itself again the next bull run will be in another two and a half years.
Gosh I couldn't wait that long.
Ask yourself why Crypto isn't currently in a bull run? For one it can't scale. Even Steem is having problems getting to 50 million or a 100 million user base. Myspace didn't have these problems back in 2008 but Steem is. Reddit doesn't have these problems but Steem does. This tells you why crypto cannot maintain 100 billion dollar market caps while these companies can.
So yes, when one company such as Facebook is easily worth hundreds of billions of course Steem could be worth 1 billion. Of course some crypto app could be worth tens of billions and eventually 100 billion. It doesn't take 10 years either.
The main issues for crypto:
True, we just needed time probably @dana-edwards which for me I can't afford. Sigh.
Hey I didn't say I can afford it either. Growth does take time, but as long as teams make steady progress with the end goal in mind then positive changes keep happening.
If the goal is mainstream adoption then steps can be taken to create the technologies to enable people to pursue that goal. Scaling is critical to pursuit of mainstreamability.
Actually, if history repeats itself (btc to increase in price before the halvening (May 2020)) then we should see an uptrend as soon as the end of this year.
Probably sooner than that but in my opinion it's not really about Bitcoin. It's about if I want to start a company to solve a problem while making lots of money then I need lots of room to grow my user base.
This means we need to be able to scale indefinitely, or more reasonable to billions of users. If someone tried to implement a Facebook clone on a blockchain today it would fail because the platform cannot handle the amount of traffic. It would be too slow, it would also not be as private as Facebook.
What makes you think the bulls will return even sooner?
Scalability is definitely the number one concern atm. Even though Steem is chilling at 0.08% of its total capacity, 100 million users would overload it to the point where ETH was when Cryptokitties clogged it up. Slow and almost unusable.
That's something we need to keep in mind if we want any kind of mainstream adoption in the future but before that happens, we will have to go through a couple of boom and bust cycles.
I agree with every point you stated in your first response to @cryptopie.
Have you seen Steemit's Wikipedia page?
In my opinion "Bulls" are users. They return or leave based on the value a project offers them. Bitcoin doesn't offer much value to casual users. What can you do with Bitcoin besides buy it and hold it hoping that someone else will buy it later? That's why Bitcoin isn't in demand and why the "bulls" aren't back.
To use Bitcoin requires a Bitcoin which can scale. Lightning for example might help it scale.
But then the taxes discourage using Bitcoin as well. Capital gains taxes and price volatility make it so Bitcoin doesn't work well as a currency .This is why people are using Dai, Tether, etc.
Ethereum I think has more potential for mass adoption than Bitcoin. Steem had potential but has squandered it's lead. SMTs and scaling need to be implemented for Steem.
But for crypto to go into bull I think the main two barriers are regulatory suppression (IRS tax policies, SEC being unclear, advertisement bans, etc), and inability to scale. Fix those and I think the bulls will come back because the usage will support long term growth. Right now why buy Steem if we don't even know if crypto is going to remain legal? Why believe in Bitcoin if the tax policies are set up so you pay more taxes for a cup of coffee bought with Bitcoin than you would using your credit card?
I don't really believe the boom and bust cycles represent the underlying fundamentals. The stuff we are seeing right now I think is the result of very low volume and a few big pocket entities toying with and manipulating crypto prices for profit. When volume is this low, and when you can short or pump and dump very easily, it's more than likely manipulated.
I look at news articles for example and when I see trends in the articles I can see attempts to push the price down. Suddenly articles linking Bitcoin to child abuse appear, or articles saying Bitcoin could be in a bear market for years without citing any fundamentals, or articles saying if we just wait for institutions to come save the market, all of these sorts of articles seem more like propaganda than the sort of stuff which tracks fundamentals or even technicals.
Fundamentals have improved since 2017-2018. In 2019 fundamentals are better than ever for a lot of projects. Technicals are pointing to a bottom, not capitulation. Talk of capitulation is based on some assumption about how people in a market are supposed to feel (manipulation) rather than based on some numbers or some data beyond sentiment. Sentiment in my opinion is the easiest to manipulate with rumors, hoaxes, disinfo, propaganda, so I don't rely on investor sentiment as much as I do on use statistics.
Steem has a lot less people using it. Search engine interest data is down. Volume into crypto is down. The rest is propaganda. I track only the total volume flowing into crypto on Coin market cap or the total volume going out. When I see Bitcoin with over 50% dominance I think that it's due to manipulation unless total crypto volume is going up.
Why target institutional investors? Why not just target retail investors and focus on steady user growth? If people actually are earning and spending crypto on games, platforms like Steem, etc, then it grows from utility.
The problem is the utility isn't good enough because the tech isn't good enough. Quite simply, it does not scale well enough to grow to billions of users. It's certainly plausible with Plasma, sharding, ZS-SNARKS, and other similar solutions that we will have the scaling problems solved sometime this year actually.
Once the scaling problem is solved then it's just a matter of solving the UX problem. The UX problem is the easier problem to solve. Coinbase for example is doing some effort to solve it with their Earn initiative.
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