Is the Bitcoin Bubble Over?

As you begin reading this article, you will notice that I use the term Bitcoin Bubble. In reality we are takng about the whole Crypto Bubble including Cryptocurrencies, Tokens and ICOs.

Anyone tracking Bitcoin and other cryptocurrency since December, will have noticed a trend of extreme price swings, with BTC ranging from $20,042.90 USD on December 17, 2017 to $6135.56 USD on February 6, 2018. Of course, the price drops are hardly surprising given recent announcements such as major players Facebook and Google moving to ban ICO ads, as well as major hacking scandals on various exchange platforms and crypto-wallets.

Perhaps, what is more note-worthy, is that all of these scandals only caused momentary price changes (at least since February). The effect of the bubble craze and Tether scandals in December are still clearly evident, despite its having no apparent negative effects on Tether USDT’s prices or usage on exchanges.

For those who are wondering what events have lead to the current halt in the previous bullish trends, please see below:

Reaction to the Bitcoin Bubble Since July 2017:

• General pre-existing US regulations against US citizens participating in ICOs (not that this has stopped them)
• July 25, 2017 – The SEC Rules the DAO as security. Read More
• August 2017 – The Monetary Authority of Singapore weighs in. Read More
• September 12, 2017 – China bans ICOs. Read More
• September 28, 2017 – South Korea bans ICOs. Read More
• September 2017 – Canada to create Sandbox as it looks at Regulating ICOs. Read More
• September 2017 – UK – the FCA is working on their policy framework around ICOs as they published their Discussion Paper on this April this year.
• January 30, 2018 – Facebook announces restrictions concerning crypto and ICO advertising. Read More
• January 30, 2018 – Bitfinex and Tether are subpoenaed by the United State’s Commodity Futures Trading Commission.
• February 2, 2018 – Major American credit card companies Citigroup Inc., Bank of America Corp. and JPMorgan Chase & Co. ban cryptocurrency purchases through their cards.
• March 14, 2018 – Google announces plans to ban crypto and ICO advertising from June 2018. Read More

Some Major Scandals and Concerns Surrounding Cryptocurrencies and ICOs

• July 2013 – BitFunder.com loses 6,000 BTC in hack.
• 2014 – Mt Gox hacked for 120,000 BTC, worth $72 Million USD at the time.
• August 2016, 120,000 BTC stolen from Bitfinex exchange.
• December 2017 – North Korea accused of hacking and stealing $7 Million USD worth of BTC
• December 2017 – $64 Million USD worth of BTC hacked from Slovenian exchange NiceHash.
• The Tether Travesty – Tether Limited claims a holding of $1 per Tether (USDT), yet saw an unsubstantiated growth of 10,000% of holdings in 2017. This is concerning given that their are over approximately 2.2 billion USDT currently in circulation, many of which were used for transactions during the December 2017 crypto-frenzy .
• January 2018 – $534 Million USD worth of NEM stolen from Japanese exchange Coincheck.
• March 20, 2018 – Child abuse images found in the bitcoin blockchain. Read More.

The Bitcoin Bubble and the Case of the Vanishing ICO

(I’m only listing a few here. There have been many more, with some claiming as many as 1 in 10 are doomed to failure or are outright scams):

• OneCoin – The ICO Ponzi scheme. It has been operating since 2016 and has been banned in many countries including Portugal and Bulgaria. The exact amount of money earned by this project is unknown, but is suspected to be minimally within millions of USD.
• August 2017 – Droplex duplicates QTMs
• November 7, 2017 – Confido raises between $375,000-$400,000 USD and disappears.
• December 4, 2017 – The US Securities Exchange Commission arrested PlexCoin founder for suspected fraud. They raised $15 Million USD, but continue to assure investors that they are still present, in spite of suspended activities.
• December 4, 2017 – The US Securities Exchange Commission arrested PlexCoin founder for suspected fraud. They raised $15 Million USD, but continue to assure investors that they are still present, in spite of suspended activities.
• January 31, 2018 – Prodeum ICO raises $11 USD vanishes. It’s not the number that is concerning, but the fact that fake profiles were created for real experts, claiming them to be the founders of the project.
• February 13, 2018 – LoopX makes off with around $4.5 Million USD.

Bitcoin Bubble: The Conclusion

As stated earlier, in all of the above cases, crypto-prices dropped temporarily if at all, before slowly rising again. Likely this was due to the dedication of true crypto-believers who were waiting for a significant drop in price before springing to buy up BTC and other cryptos from nervous newcomers. In my opinion, we can no doubt, barring another major announcement, expect a similar trend in the coming month or two. This buying will in turn increase the crypto-value, thereby increasing the hype and again leading to renewed interest and purchase of crypto currencies. Or maybe even the the most steadfast of HODLers have decided to practice caution.

Only time will tell if the bitcoin bubble has burst.