Bitcoin’s Drop Is Different This Time, Says Weiss Ratings Founder
The founder of Weiss Ratings believes the latest drop in BTC prices reflects not only market realities but also underlying technological setbacks.
Bitcoin (BTC) has shed more than 81% since hitting its all-time high, and more than 66% in the past year alone, effectively erasing all gains from the December 2017 rally. Martin Weiss, the founder of Weiss Ratings, released a statement about the drop in prices, which has led the market closer to continued capitulation selling.
“Since Bitcoin began trading actively, it has plunged by 70% or more on four separate occasions. Each time, people wrote its obituary. And each time, Bitcoin rose from the dead, rising by an average of 6,300% from low to peak. Now, Bitcoin has declined by more than 70% again, setting the stage for another major price rise likely to begin in 2019,” Weiss wrote.
While BTC prices have recovered in the past and scaled new heights, Weiss believes the fate of the Bitcoin network may be different this time. Weiss Ratings has put a special emphasis on innovation when it comes to distributed ledger technologies, ranking higher projects like EOS and XRP. However, Bitcoin purists see the classic blockchain with proof-of-work as the more robust system.
The mainstream attention to Bitcoin that took off in the fall of 2017 was followed by a deep crash, which led to personal finance losses. With a much more skeptical mood, the markets may be in for a long freeze. There are also expectations that another asset may increase its importance and overtake Bitcoin, but so far, altcoins are even shakier when it comes to price and adoption.
During another sell-off on Monday, BTC prices abandoned the $4,000 level once again, going down to $3,880.57 as of 5:00 UTC on Tuesday. Again, more than 60% of trades are against Tether (USDT), further underscoring the withdrawal of new cash investments. At the moment, BTC trading is responsible for 36.6% of all volumes, remaining the most active coin and accounting for more than 53% of the entire crypto market capitalization.
Despite its relatively strong position against altcoins, Bitcoin seems to be on the wane. Even after the latest downward adjustment in difficulty, mining continued to slow down, sinking to 36EH/s.
The deceleration in mining from recent record values has set off talks of a “Bitcoin death spiral,” where miners abandon the network.
Nouriel Roubini has also noted the possibility of a continued crash, but Bitcoin proponents remain more optimistic:
The general expectation is that 2019 would be a slow year, with BTC prices sliding to new lows before attempting another rally.