Predicting markets can be a fool's game. But some experts say they can make general, broad predictions based on valuations, investor behavior and cyclical market patterns.
We caught up with five industry participants with a good pulse on cryptocurrency markets: Jim Blasko, founder of Bitcoin Talk Radio; Marshall Long, co-founder of eBoost, which integrates cryptocurrencies into gaming communities; Michal K Jeoung, CEO of cryptocurrency asset management platform, TrustVerse; Max Tsaryk, CEO at Blockchain-based content sharing platform ASQ Protocol and Nate Whitehill, co-founder and CEO at cryptocurrency news site, Cryptoslate. Here is their take.
The Floor Is In?
Jim Blasko bullishly predicts that Bitcoin will top out anywhere between $100,000 and $200,000 in late 2020 or early 2021 (It's currently trading around $6,500).
His prediction timeline follows a pattern of the technology's mining "reward" changing from 12.5 Bitcoins per block mined down to 6.25 Bitcoins -- as well as price increases of five times and then nearly ten times Bitcoin's previous high.
The reward being cut in half should increase the price of BTC, Blasko reasons, as each "halving" creates the "fear of missing out" spark that ignites parabolic Bitcoin price increases. Halving, in other words, is a not-so-gentle reminder to miners and investors that there is a finite supply of Bitcoin. And what little is left is going to get a lot more expensive to earn or mine.
Marshall Long is not quite as bullish but also predicts an upward trend as halving affects supply and demand and creates a bullish pattern. In November 2012, Long notes, Bitcoin's mining reward split from 50 to 25 Bitcoin and the crypto saw increases in price that were in line with as much as 40 times the previous high point of $30 in 2011, to a new high point of $1200 exactly two years later, despite a cooling-off period that followed.
Another halving in July of 2016, when the reward dropped from 25 Bitcoin to 12.50 Bitcoin per block, created the same bullish pattern, according to Long.
Long also forecasts a drop in regulatory uncertainty that -- to a lesser degree -- should slowly drive Bitcoin's price higher. According to Long, Regulatory uncertainty will fall as regulators continue to step in and separately, we'll continue to see an uptick in adoption that gives the appearance that Bitcoin has gone mainstream.
Specifically regarding the SEC, Long says that he is "very interested to see how SEC and Bitcoin Exchange Traded Fund plays out as that may be the match that sparks the next bull season." He also notes that Bitcoin adoption has accelerated with wallet users now nearing 30 million, compared to just 9 million in 2016 and 17 million in 2017.
Long advises us to be ready to accumulate Bitcoin around March of 2020, when halving -- the primary price catalyst -- starts to drive Bitcoin's price higher.
Michael K Jeoung, on the other hand, believes that Bitcoin prices bottomed out at $5,000, and negative press -- especially around China's antagonism to cryptocurrencies -- is overblown. If anything, China's reported plans to create its own government-controlled cryptocurrency and increased regulation worldwide indicate more widespread adoption.
Jeoung is therefore completely unfazed by the 75% price drop in 2018. Instead of calling this a wholesale price to pick up Bitcoin on the cheap, he refers to it as the "whalesale" price.
Although short-term price drops could happen any time between today and the end of 2019, as a long term "Hodlr," -- a term commonly used among cryptocurrency investors to describe a buy-and-hold strategy -- Jeoung believes a meteoric price rise is just around the corner.
Other Cryptocurrencies Could Be in Trouble
Max Tsaryk is bullish on Bitcoin but takes a much more pessimistic view of Ether -- the cryptocurrency associated with the Ethereum blockchain protocol on which thousands of applications and smart contracts rest -- and "ERC tokens," which are the cryptocurrencies associated with those applications.
According to Tsaryk, well-executed hacks could render ERC tokens worthless if they are not moved to their own blockchains. And what if the "most popular smart contract platform/network [failed]?," Tsaryk asked me.
Tsaryk's company, ASQ Protocol, created Aspire to develop proprietary blockchains as a potential solution to hacking. Analogous to "getting off the main electric grid" in energy markets, ASQ gets blockchain protocols off of the main Ethereum "grid" as a preventative measure in the event of an adverse incident.
Nonetheless, Tsaryk says that "2019 will be the year of blockchain's mass adoption and [the] boom of the decentralized applications."
CyptoSlate's Whitehill, meanwhile, thinks that a potential turnaround for cryptocurrencies could be much further out. "Cryptocurrency prices may see a turnaround in the event of a 2019 Bitcoin ETF," says Whitehill, "But the last bear run lasted several years and we are only 10 months into what may be an extended crypto winter."
The author holds stock in investment holding company, Leucadia, and is a partner in an emerging technology marketing firm, Notability Partners. He holds no positions in cryptocurrencies nor in any companies that invest in them.