Sooner or later the markets will correct themselves, and many will look back and wonder what happened. In fact, many are already doing that in light of the recent currency corrections across the markets (as discussed in earlier posts). It makes one wonder if there is really any chance of the Altcoin Sphere to ever make it into the realm of the illustrious Bitcoin, at least on a scale of parity.
That said, the only comparable situation is that of the current deflation of the EURO against the Swiss Franc, which has been hedging itself against all the other major currencies since 2009 when the first recession ripple shredded through the global economy. The next ripple is set to rock across the markets through the rest of the 2015, but this doesn’t have to be an outlook of sentiment or remorse. In fact, even though Bitcoin is lower than its average price, this can actually mean a lot of good things for people who understand that is has a value that has been earned, unlike some Altcoins, which have just been created, or are easy to produce.
Many of the dominant investors on the global market see Bitcoin as an excellent medium for solving the problems of currency solvency, which has been a problem across the world, especially in governments and countries that just “print money” when they start running low. The idea of the Altcoin held much of the same merit that these fledgling currencies, with some of them like Paycoin, being contested as a Ponzi Scheme which held no merit, and everyone was back the drawing boards, but during these contentious back and forth trading models, Bitcoin did something behind the scenes.
Even though it was being traded like the Dickens, with the market actually trading its whole volume day after day, Bitcoin didn’t collapse, crunch, or bottom-out, even if the price swung widely. So are we to expect the $200 level to be the new rolling average? My guess, is that this price is going to be around just long enough for people to get a chance to get in while its cheap, but also for other speculators to question their investment models.
It is never fun when we see our investments reduced by half, or cut down, but we must remember that everything is “relative” — much like Einstein’s Theory Of Relativity. It is truly dazzling to see how the market cycles through the entire supply of Bitcoin each trading day. Check this out:
With only a limited supply of 13 million coins, and average daily volumes around 24 million, we can see that 92% of the supply has been moving on a daily basis. If this cycle continues, then it may be possible for buyers to swing the currency into an elite class, thus decoupling it from the other coins. While it remains to be seen with Bitcoin, one can already see this happening with the Swiss Franc, so suddenly, the idea doesn’t seem so far-fetched at all.