RE: Ripple's Market Capitalization Tops 11 Billion USD, Could This Become The Biggest Bubble Yet?
Thank for sharing! I am interested to find out your thoughts on whether we are in a cryptocurrencies bubble now? Here is the DATA which support this my assumption: it looks that we are entering bubble territory for a vast majority of alt coins (except Bitcoin probably). Just think about and analyze the following facts:
At least several dozens alt coins market caps skyrocketed 300%-4000%(yes, four thousand!) recently just over last 2 months!
The beginning of sharp increase happened around middle of March of 2017 for ALL alt coins!
Yes, some alt coins sharp increase is logically justifiable. For example, Ripple XRP: http://www.cnbc.com/2017/03/01/japanese-banks-plan-to-adopt-blockchain-for-payments.html . Maybe there are couple other alt coins where this huge growth is also justifiable.
But for vast majority of other alt coins nothing has changed drastically during the last 2 months! At all! Neither in their technologies development, nor in their business development! But nevertheless, their market cap skyrocketed 300%-4000% in just 2 months!
The only explanation which comes to mind is that huge amount of new capital is coming to cryptocurrencies market. Probably these are the people/investors who have heard about the first wave of Bitcoin and Ethereum successes, and they have a FOMO (fear of missing out) now. They don't have deep understanding of cryptocurrencies space and their differences, but because of FOMO they still invest in all other alt coins hoping to hit jackpot!
Does it remind you anything? Yes, exactly, dot com bubble of 2000 looks very similar!
Therefore, I would expect some kind of significant downside price correction within next several months for the majority of alt coins. Would you agree?
Awesome reply! The recent support and capital that the cryptocurrency market has gained over the past several months is a sign that there is additional interest in cryptocurrency, especially by high value and institutional investers. While some of the coins that have experienced serious gains have gained practicality and passed technical hurtles, very few of the coins have made signficant enough advancements to justify their price increases.
I personally don't consider the cryptocurrency market as a whole a bubble yet, but there are defiantly some major bubbles forming that we will see the consequences of in the upcoming months.
The fact that with most coins the technology has made little improvement while the price has seen major gains leads me to assume that many investors currently just don't want to miss out on the 'next big thing'. I think that there are many cryptocurrencies that are currently drastically over valued,and I think many coins will experience huge loss of value in the upcoming months and years.
Blockchain technology is so valuable, and firms and high level investors are beginning to realize that. The problem is that there currently enough projects that are truly worth what their market cap is. If the amount of money that individuals want to invest drastically outweighs what the projects are currently worth, then we will see many coins hold highly inflated and unsustainable price levels.
I'm sorry if this seems kind of confusing due to my wording!