As bitcoin passes $10,000, experts consider whether cryptocurrencies will crash or carry on

yousafharoonkhan (75)in #bitcoin • 7 years ago (edited)

THE FINTECH EFFECT
As bitcoin passes $10,000, experts consider whether cryptocurrencies will crash or carry on
Bitcoin has posted a return of over 900 percent since the start of the year
One technical trader said the rise of bitcoin in 2017 is the biggest bull market he has seen in over 40 years of working in finance
David Shrier, academic and CEO of Distilled Analytics, told CNBC that he has absolutely no doubt that there is feverish speculation going on with cryptocurrencies

Shrier said he is not overly worried that a crypto-bubble "crash" will hinder bank acceptance of so-called distributed ledgers and added that "speculation helps attract new sources of risk capital and new entrepreneurs to the space."

"Other market forces will assert themselves eventually, and what will emerge out of that is a new way of operating," he told CNBC.

On bitcoin's price volatility, Williams explains that for a cryptocurrency to be used day-to-day, its value has to be stable otherwise it cannot be effective as a medium of exchange.

"The value of bitcoin is notoriously volatile because it is created mainly by the interaction of speculative demand, which makes application as a normal currency impossible for now," he said.

He is concerned though about the possibility that some people getting in on the action may get burned and bitcoin ends up being a kind of pyramid marketing scheme that leaves only the early buyers rich, with everyone else losing plenty of money.

"Only time will tell," he added.

The rally may not even be over yet, according to some commentators. The man who called bitcoin's rise to $10,000, fund manager Michael Novogratz, has over 20 percent of his net worth in cryptocurrencies and told CNBC that he sees the possibility of it reaching $40,000 by the end of next year.