The laws of nature are timeless.
Everything works in cycles: from the moon and planets to the ocean’s tides.
The seasons, of course, are no exception — a comforting thought in the bitter Melbourne cold I’m writing this from right now.
When I stepped outside to check the mail this morning, it was like walking into the refrigerated section of my local bottle shop!
But after winter must come spring.
This law applies, too, to the financial world.
It’s a fact crypto enthusiasts will do well to remember throughout the enduring ‘crypto winter’: a long period where cryptocurrency prices have been in the doldrums.
But is the ice finally beginning to melt? Is the sun shining down once more on the crypto space?
After all, nobody can forget how brightly it shone in December 2017, when bitcoin hit an all-time high of $20,000…
And who says that can’t happen again? Who says it couldn’t even happen as early as this year or even next month?
But let’s calm down a bit first and take a quick look at the history…
Not long after that great December in 2017, bitcoin’s price dropped by over 80% in the space of 13 months.
Sadly, it hauled the wider crypto market down with it. Many cryptocurrencies fell in price by 95% or more.
Many wondered if crypto was just another fad, a modern tulip mania, ultimately destined for tragedy.
People like Kenneth Rogoff, the former chief economist at the International Monetary Fund (IMF), publicly claimed crypto was doomed to fail.
He prophesied that the bitcoin price, in particular, would drop as low as $100 in 10 years.
And that wasn’t the worst of it.
Adoption of the newfangled money fell short of expectations. Many folks didn’t really know what it was, how it worked, or why it was even important. The truth is, many still don’t.
The continuing poor market performance of several crypto giants only depressed coin-holders even more…
You could say it was a winter harsher than in Game of Thrones!
The beginning of this year looked nuclear.
But as per the cyclical nature of things, the crypto landscape has slowly begun to tip in a warmer direction.
It’s not spring yet, but there’s a definite thaw taking place.
Big businesses and governments stopped warning us about crypto, and actually started buying into it instead.
Talks of a mystery crypto project at Facebook began to circulate. Samsung announced its development of an Ethereum-based blockchain.
And just yesterday the oldest bank in South Korea announced they were set to use blockchain technology to speed up their loan approvals process.
South Korea is actually a bit of a leader here.
A recent survey, for example, revealed that South Koreans are spending an average of $6,000 on cryptocurrency.
Japan has been called a ‘cryptocurrency haven’, with many of its companies embracing the new technology.
And the little-known island of Malta is surprisingly leading the world in crypto trading.
This is a global trend…
But aside from that, it’s becoming increasingly clear that, in the markets, crypto could be set to boom again.
Bitcoin’s price recently set a new record for 2019, reaching US$8,905 at one stage.
Take a look at the price data from CoinDesk:
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Look at that spike.
In the last few weeks, other top cryptocurrencies like Ether and XRP have gained 5.3% and 5.8% respectively on a 24-hour basis.
But most tellingly of all, the total market capitalisation has risen to a high of US$268.1 billion. That’s its highest point since the beginning of August last year.
The market captilisation for altcoins (smaller cryptocurrencies) is up $6 billion.
These are all signs that there’s been an upswing. That funding continues to pour into the crypto space overall.
And that’s great news for anyone who’s invested in it.
Crypto winter? Doesn’t feel too cold to me…
Three billionaires enjoy a whopping crypto payday
I’ve always believed in the value of knowing where the powerful choose to invest.
After all, their dollars will make the biggest impact — not only in terms of the markets, but also in the wider world itself.
So that’s why I was interested to learn that in news just in, crypto-investing billionaires Peter Thiel, Alan Howard and Louis Bacon have profited massively from their crypto ventures.
This is due to a buyback by Block.one, a cryptocurrency start-up. Reports say it will return as much as 6,567% to its earlier investors in less than three years.
So what does that mean in dollars and cents?
Well, it translates into US$6.6 million for a US$100,000 stake. Not bad at all.
The company plans to announce a social media project in June. I’d be keeping my eyes wide open for that one!
Crypto is not dead. There is a natural cycle to things, and it’s reflected even in the financial markets.
Summer is coming. Big spenders’ actions are the proof in the pudding. One commentator even thinks it could be ‘awe inspiring’:
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I’d recommend that you always do the research yourself.
Most importantly of all, don’t let the media fool you.
Soldier on when the cold front hits, and wait for warmer days!
Contributing Editor, Money Morning
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