Cryptocurrency has changed the financial market of the world and multiple industries along with it. Some industries, including the online casino world and make placing our bets at an online casino real money a lot easier than it was.
Come with us as we explain what happened during the crash of crypto and also look into what the new year might bring for crypto.
What is Cryptocurrency?
Before we get into the nitty gritty of cryptocurrency, we first have to understand what cryptocurrency is. Cryptocurrency is a digital currency that can be used similarly to fiat currencies with benefits of using cryptocurrency including:
- Decentralization
- Lower transaction fees
- Quicker transaction times
- Safety and security and many more
Many investors use crypto because it is decentralized, meaning that one party, bank, government, or person holds all the power within the network. This means that financial institutions such as banks and the government have little to no say over what happens within the network.
What Was the Cause of the Crypto Crash?
In 2022, cryptocurrency, specifically, Bitcoin, saw a crash that would leave the market devastated. Although crypto is well known for being a highly volatile market, with crypto making extreme peaks and even more extreme lows, its value has never been affected as severely as it is currently.
After making impressive peaks of $69 000 in 2021, the value of crypto took a terrible turn and reached lows of $16 000 in 2022.
Many have speculated on the cause of the crypto crash, with many pointing fingers at the Ukraine war, higher interest rates, and inflationary fears. The market saw a collapse of one of their biggest crypto companies, FTX, which is said to have handled $1 billion worth of transactions daily. The collapse caused a ripple effect on other crypto companies leaving most unable to do what was necessary.
So What Happens Now?
Cryptocurrency has seen many changes within the past year. We’ve seen crypto go from a thriving market to a market filled with uncertainty and experts of note clashing in their predictions of what the new year will bring.
Many experts have predicted the rise of Ethereum and the fall of Bitcoin. In previous times, the cryptocurrency market was led by Bitcoin; however, with the US recession and with stocks in a bear market, we could see the start of the individualism era within the cryptocurrency market.
This would be the perfect environment for cryptocurrencies such as Ethereum to take over the crypto market.
In recent times, Ethereum has seen a rise in daily transactions with highs of up to or exceeding one million daily. In 2016, Ethereum saw highs of 40 000, with daily transactions going above half in 2019 and reaching peaks of 700 000.
The sudden peak in Ethereum can be attributed to its utility token. In previous times, investors were enticed by Bitcoin’s utility coin cap of up to 21 million tokens, but with Bitcoin’s dwindling in the wind, investors find themselves looking in other directions, which is where Ethereum comes in.
Ethereum has recently topped every project and currently holds $3.8 in revenue over a 12-month period. This makes Ethereum a lot more enticing than it was when it initially started.
If you’ve been keeping your eyes on meme tokens, then you might want to think twice before you make an investment.
Meme tokens such as Dogecoin and Shiba Inu are said to lose over 50% of their value within the year.
In 2021, the meme tokens reached their respective peaks of over 20 000%, making them fast-growing and an amazing investment; however, these numbers left as quickly as they came. In fact, both meme coins have lost over 90% of their value, and these trends are said to continue into 2023.
This is because meme tokens, specifically the two we mentioned above, are used to make payments. Thousands of cryptocurrencies can be used in a similar manner within the market, making their relevance short-lived and their actual value a thing of the past. This is because of the current economic issues happening all over the world.