Cryptocurrencies Getting Volatile

Financial Advisory firm, deVere Group’s founder and chief executive, Nigel Green sees volatility making a comeback in the cryptocurrency market after a long absence. Mr. Green believes investors will use it as a major buying opportunity.


Reportedly, Bitcoin has fallen in price by $1,400 in 12 days, going below the $5,000 threshold for the first time since October 2017.  The bearish sentiment is echoed in a broader decline in the overall crypto market capitalization over the last few days. Green observes: “Just a few weeks ago crypto traders were airing concerns about the lack of volatility in the crypto market. Now volatility is back, and many investors will be using this as a major buying opportunity, perhaps the last one of 2018. Savvy investors understand that digital currencies are the future of money and, as such, they will be capitalizing on the lower prices to build their portfolios and shore-up their positions.”


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Mr. Green believes there are three main drivers for the current bout of volatility:


1. The uncertainty surrounding the Bitcoin Cash hard fork. Last week, a new version of Bitcoin Cash was launched, which was itself a ‘fork’ from the original Bitcoin blockchain. Bitcoin Cash is now known as Bitcoin ABC and the new fork is called Bitcoin SV. These forks generate turbulence in the market because investors must choose which version they will support.


2. The recent scrutiny of the SEC, the U.S. financial regulator.  However, I have long supported and called for regulation of the crypto sector.  Indeed, regulation of the digital currencies is now, I believe, inevitable and will in the longer term give investors even more protection, driving confidence and prices in the burgeoning market.


3. The infamous ‘herd mentality’ of some investors. Simply, some of the cryptocurrencies are lower because they went lower. Prices might fall further over the next few days, but we can expect a long-term upward trajectory for the crypto sector.


For more details, visit the deVere Group.