Can Cryptocurrencies Destroy Blockchain Trust?
Oct 18, 2021
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The popularity of cryptocurrencies made specialists forget about the possibilities of blockchain technology. The cost of cryptocurrency is growing and new solutions are focusing on its mining. Can cryptocurrency be expected to be the main and only application of the blockchain? We asked experts about this.
Iryna Kidyba, Financial Manager at Monfex
Experts called the conditions under which the first cryptocurrency could exceed $50 thousand in the near future and continue to grow to new highs On the evening of September 7 bitcoin rate collapsed sharply to $42.8 thousand. The first cryptocurrency for an hour and a half fell in price by $8.5 thousand. September 9 bitcoin is trading at $46.2 thousand. RBC-Crypto experts predicted whether the fall in quotations will continue, or bitcoin can return to growth and again rise above $50 thousand.
With bitcoin’s price rebounding to $50,000, the bulls faced serious resistance at $47,500, according to NewsBTC analyst Ayash Jindal. According to him, further growth of the main cryptocurrency is possible only if the quotes will overcome this resistance level and the bulls will be able to consolidate above $47.5 thousand. In case of such a scenario, the next important resistance for bitcoin will be $48.5 thousand, added Jindal. In case of an unsuccessful attempt to overcome resistance, bitcoin may begin to decline to the first support level, which is near $44.8 thousand, the analyst explained. In case of breakdown of this level, the price of the main cryptocurrency will continue to decline to $43 thousand, Jindal emphasized.
In the near future, bitcoin is expected to recover to $50 thousand, according to Maria Stankevich, director of development of the cryptocurrency exchange EXMO. According to her, then to continue the rapid growth of the main cryptocurrency will need to break through the level of $51.3 thousand. In this case, the coin will continue to move to $58 thousand, Stankevich explained.
Forecasting the growth of the crypto market will be possible only on the basis of some positive news, said the head of the analytical department of AMarkets Artem Deyev. In his opinion, bitcoin may continue to decline in case of any negative factors. As an example, Deev cited increased regulatory pressure in the U.S.
James Page, Technical Writer, Crypto Head
Cryptocurrencies are expected to rise and even increase in price, as it has been the trend since the pandemic last year. Right now, we pay attention to the growth dynamics. With cryptocurrencies, more companies are considering training them for payment modes, which experts now study and observe for viability. Expect the newest currency, Central bank digital currencies that will be launched too late this year.
Bitcoin or Currencies, use blockchain technology to record a ledger of payments, thus it really did not ruin blockchain. However, since it can be used to immutably record data points, there’s a huge tendency that it might be causing chaos amongst the tech too.
Harriet Chan, Co-Founder of CocoFinder
The demand determines the price of the cryptocurrency. Though cryptocurrencies have not yet been accepted by many countries as legal currency, the rise of this value is consistent. Bitcoins are dominant on this cryptocurrency platform, and its price witnesses a constant shoot up despite its authentication issues. Mining increases when there is a demand for it, and the price simultaneously rises to the sky.
Anyone interested in this virtual decentralized currency can make money with little knowledge in blockchain technology, mining, and understanding the strategy behind selling and buying bitcoins on time. There are many websites available in the digital space to enlighten with cryptocurrency and its associated parameters that require a constant monitoring process for expected outcomes.
A careful approach in investing in this mining technology is appreciable. Similar to share markets, there are ups and downs with this trading. A clear understanding of this virtual market helps you a lot in deciding your trading tactics.
Blockchain technology assists in predicting the fluctuations and assists in making the bitcoins effectively. Proper understanding of the decentralized virtual trading of bitcoins will help anyone to make profits beyond expectations. Keep your every move with utmost consciousness to avoid serious loss in this virtual trading platform.
Danish Lala, Think Leaf Solutions
The prices of cryptocurrencies are volatile. They are not pegged to any one factor. As in case of stocks, the price is based on sentiments in short term and the intrinsic value in the long run. The value might increase on any bullish news (such as acceptance by a federal govt – giving it a legal tender status).
Many people are unaware of the intricacies of mining cryptocurrencies. Mining of cryptocurrencies has a cost attached to it. It requires electricity and some good machines – read computers – to mine. You can’t mine it for free. The resource cost you spend mining should be lesser than the price of the mined units. It is a simple equation – Cost of Mining < Price of Units mined. In case it is vice versa then you are paying money out your pocket.
Hence, mining cryptocurrencies is not free.
Has cryptocurrency ruined blockchain technology?
We believe it has given popularity to it. Not many knew about blockchain but cryptocurrencies gave the technology great amount of exposure. Blockchain is now being implemented across different applications and industries. Though we cant say if it has ruined blockchain technology or not but surely has given it fame.
Conner Goldberg, Managing Director, Ascension Cloud Solutions
It depends on the cryptocurrency. For the sake of this discussion we’ll stick with mainstream ones like Bitcoin and Etherium. The value is speculative currently, like gold. Both cryptocurrencies market themselves as a deflationary asset such that the value compared to the market cap will consistently increase. However, this is only relative to other assets.
Often times speculative investments are used to hedge against inflation, but if other assets, that are less volatile, perform well. FOMO (fear of missing out) can creep in, and people will liquidate speculative assets in favor of wanting to progress their investments in an alternative vehicle. Because of this, cryptocurrencies will always fluctuate heavily, especially as legislation creeps in to try and maintain control over how they are purchased/exchanged.
Currently, cryptocurrencies that are the most promising are ones that offer some form of utility whilst also having some marketability. This could be a meme like dogecoin being tweeted by influencers like Elon Musk, or Etherium and their utilization of smart contract integration. Unfortunately, the means of influencers marketing cryptocurrencies combined with the lack of regulation can lead to ponzi scheme like investment scams which seek to only create a pump and dump situation. This can be shown by a crypto currency created & marketed by a well known youtuber which saw a rapid rate of growth upon the first week’s initial coin offering reaching over $200 per token, and now falling down to around $16 per token.
Mining essentially mints the cryptocurrency, so yes as more miners start mining cryptocurrencies the lower the price can potentially be (unless offset by some other stabilisation factor). This is why, most coin networks will make the algorithms required for mining more and more complex such that it requires additional resource in order to successfully mine a token.
Cryptocurrencies are for all intents and purposes, a digital good with a value and market cap. The hardware components for mining cryptocurrencies also require an upfront investment from the miner in order to be profitable. If the cryptocurrency is easy to mine, the value will naturally be lower as a result, and at the end of the day, a cryptocurrency will only be worth as much as the next person is willing to pay for it.
Blockchain technology has its own caveats and hurdles which need to be solved other than cryptocurrencies. Blockchain technology can be utilised without cryptocurrency, so no it has not ruined blockchain technology. Unfortunately, other exploits exist which need to be addressed before it can see mainstream adoption.
Johny Bogard, Business Development Executive (New York)
As cryptocurrencies continue to gain traction, their value is set to skyrocket. Consider this: in the last year alone, Bitcoin has risen over 8000% in value. If you had invested $100 USD in Bitcoin this time last year, your investment would be worth $8000 USD today. Investment into Cryptocurrency must be properly researched and observed prior to investment, and as such one will understand the market is saturated with mining opportunities however there’s still plenty of room in the surrounding technologies for Cryptocurrency such as: hardware, software, services required like HVAC, security control and more.
Sally Stevens, Co-founder FastPeopleSearch
Despite the pandemics ravaging the world, there has been a surge in cryptocurrency interest this year and is only expected to rise next year. In the past few days, the global cryptocurrency market has recorded a steady rise. It might even reach an all time high at the end of this year or early next year.
Anyone can mine cryptocurrency, but that does not mean they can cash in millions of dollars from nowhere. Those who are looking into investing in cryptocurrency should do it now when its market value is increasing. However, what I can say is that there is a risk. Like any other investment, you cannot expect a 100% return all the time.
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The secret of investing in cryptocurrency is not to bank your hopes on it. It is a volatile investment that can disappoint you if you have an emotional attachment to it. Just invest and forget as the money grows. I can say it is a matter of time if you want to cash in.
Cryptocurrency has brought significant changes in blockchain technology because it depends on it to solve complex equations. To say it ruined blockchain might be biased since tech experts are working day and night to enhance the blockchain technology to accommodate increased load from cryptocurrency mining.
Lynda Farley, Co-founder Numlooker
In my opinion, the value of cryptocurrencies will continue to increase as more people will become aware of cryptocurrencies. The success stories of other crypto-projects keep getting more and more popular. This is because cryptocurrency is a very effective way to invest in various projects.
There are plenty of things that investors need to be aware of when investing in cryptocurrencies. One important factor that investors should be mindful of is the price-setting mechanism, which I believe is one of the most critical factors for determining how much value a cryptocurrency will have in the future. It is not always easy to decide on the price-fixing mechanism for each cryptocurrency since it depends on the underlying technology behind each project.
Cryptocurrency mining is an essential part of the token’s value because it provides its value. Cryptocurrencies, like Bitcoin (BTC) and Ethereum (ETH), are based on blockchain technology. From my understanding, blockchain technology means that data can be stored in a distributed ledger system.
Carla Diaz, tCofounder of Broadband
As of right now, crypto’s future is somewhat hard to tell as many nations begin to consider how this new form of currency could either help or hinder their own economic progression. Some countries, like China, have begun to expunge the idea of using crypto within their borders, while others, like here in the US, have begun to wholly embrace the idea and what it could do for people later on. For this reason, cryptocurrencies will certainly see a raise in value, especially once everyone has settled into how they will implement crypto within their country’s financial system. In a way it does, but not so much the actual value of the crypto being mined.
As mining becomes much more accessible, the amount of crypto mined is halved or brought down accordingly so people aren’t flooding the market with Bitcoin or Ethereum. The value of each cryptocurrency is really only affected by people’s acceptance or avoidance of them. Anyone can essentially mine crypto, however, depending on their country, it may end up costing them more due to taxes or overall equipment costs. It is not impossible to mine or to obtain the equipment necessary to mine, but it can be expensive and energy consuming. As of right now, many people still consider mining more than a hobby, but only with sufficient hardware to mine effectively and continuously. It hasn’t ruined blockchain technology, on the contrary. Blockchain technology has actually seen a rise in interest as people begin to implement this technology into other outlets to make mining more enjoyable, such as in crypto video games.