Bitcoin Outlook For 2018 Good, But Not Certain

After the meteoric rise of Bitcoin’s value in December 2017, which saw a frenzy of market activity, the super crypto coin experienced some volatile days, dropping as low as US$7,000 for the first time in three months.

Despite this constant bearish run, crypto analysts are of the opinion that Bitcoin will eventually turn bullish and could hit US$50,000 by the end of the year. Other experts project that the total market cap for cryptocurrencies has the potential hit reach US$1 trillion before the end of the year.

While this prediction might appear as wishful thinking to many, the lead analyst behind this projection has been right on the money before. Towards the later end of 2016, Danish financial institution Saxo Bank released its yearly list of “Outrageous Predictions” for the coming year. In it, Kay Van-Petersen, the bank’s analyst predicted that the value of Bitcoin could triple by 2017.

What happened in the spring of 2017 is no longer news, when Bitcoin rose from about US$900 to peak at about US$18,000. Since the end of 2017 however, Bitcoin has struggled to maintain its value, having plunged on more than one occasion, sometimes falling as much as 40% from its all time high.

Nevertheless, analyst Kay Van-Petersen said early this year that she “would not be surprised” if Bitcoin eventually rose to a point between US$50,000 and US$100,000 in 2018. Her theory is that Bitcoin will rise in value, then drop and plateau for a bit, before climbing up again.

blockchain diagram.
blockchain diagram

Even with all these assurances, the question on the lips of potential crypto investors remains: “Is it wise to invest in Bitcoin this year?”

Here are just a few reasons why Bitcoin has the potential to increase in value this year.

First, Bitcoin ended 2017 on a high note, with investors making as much as 1,400% profit. Bitcoin also gained some form of legitimacy in the investment industry. For instance, Chicago Mercantile Exchange, a US based options trading entity, and Chicago Board Options Exchange became the first exchanges to offer Bitcoin futures trading on their platform.

Quick to follow were Swiss banks, Vontobel Holding AG and Falcon Private Bank, with both starting to offer Bitcoin trading and assets management. At the same time, the number of retailers and businesses accepting Bitcoin as an alternative form of payment increased with KFC Canada joining a number of Subway Franchises in the US who have been accepting payments in Bitcoin for some time.

Even Microsoft’s online store, Expedia Inc, electronics supplier Newegg and home suppliers Overstock Inc joined the list of major retailers accepting Bitcoin payments for purchases and transactions. This made 2017 a groundbreaking year for Bitcoin.

Also, before 2017 ended, the number of fully functional Bitcoin ATMs all over the world was in excess of 2000, a staggering increase from the one single functioning machine available in 2012. If this trend continues; in just five years, this number will more than triple, with Bitcoin debit cards becoming as popular as the regular debit cards.

As a result of all these factors working in favor of Bitcoin, analysts insist that the future is looking favorable for Bitcoin.

Also in early January, former Wall Street expert and current equity strategist Tom Lee joined the list of experts predicting a bullish future for Bitcoin. Thomas Lee believes that the current fear in the crypto world brought on by the South Korean government’s plan to ban cryptocurrencies could forces Bitcoin prices to drop far below US$9,000 before eventually climbing up and hitting US$25,000 before the end of the year. In his opinion, the current slump in prices is the biggest opportunity to buy Bitcoin in 2018.

Indeed, many investors are taking advantage of the drop in prices to jump on the Bitcoin bandwagon as well as that of other cryptocurrencies because they believe that the trend will eventually get to a point where the value begins to rise again. Obviously, it provides an avenue for investors to get richer.

However, not everyone has a positive opinion towards Bitcoin. Billionaire investor Warren Buffet predicted that “with near certainty, cryptocurrencies will come to a bad ending, while no one knows when it will happen; that it will happen is certain.”

Also consider that in addition to Saxo bank’s prediction that Bitcoin could hit US$100,000 before the end of the year, they also say investors should expect a plunge down to US$1,000 which will continue into 2019.

crypto currency prices.
Crypto currency prices

As far fetched as this prediction appears, considering the current drop in Bitcoin value, they are not totally impossible. It is not very difficult to see Bitcoin hitting the projected US$100,000 mark this year.

As at the time of writing this, market analysts say the current market cap for the whole cryptocurrency market is around US$383 billion, but it was around US$700 billion before the close of 2017 up from US$170 billion a few months before.

If it continues this way, the market cap could very well hit US$1 trillion before the end of 2018, and at this cap rate, Bitcoin would be at US$60,000 per coin.

The amount of daily Bitcoin transactions has currently outpaced the current hike in currency prices. This means that if the value of Bitcoin appreciated by 10% over the past year, the concurrent amount of trades rose by 1000%. Despite this increase, there is still obvious room for growth, which means that the expected increase in value is justified.

Conclusion

Despite these predictions and calculations, it is important to point out that the future of Bitcoin is far from certain. Given the way things have been going, it is safe to assume that at least for a short while, the value of Bitcoin will spiral between a slump and a rise, eventually reaching to new heights in 2018.

But it is also worth keeping in mind that this bubble that Bitcoin is made up of could go bust at anytime. With all that said, there is need to point out that investing in Bitcoin is not for the faint hearted. It is an extremely volatile market that only strong hearted investors should venture into.

However, for investors willing to take the risk, it is advisable to invest in Bitcoin and be prepared to hold on to it for the long haul. This is just my humble opinion and in no way a guarantee or a disclaimer.

Saurabh Sharma is a Digital Marketer and content writer, with of more than 8 years experience in Digital marketing. He is founder of www.geektub.com and author on many other platforms. He has a Master in Computer Application (MCA) honors from RTU, Kota. His work is present on the web and still working for the well-being of society. In his free time, he loves to watch cricket, football, and internet surfing.