Economist Predicts No New Crypto Price Highs in 2018

While some experts are predicting a surge in cryptocurrency prices during the latter half of 2018, economist and investor Tuur Demeester disagrees, saying he does not think 2018 will see any more all-time highs.

In a Medium article published on August 2, Demeester noted that 2018 would become a “shakeout year” for Bitcoin and altcoins.

He said, “Despite an already six month cool-off period, for 2018 we see more sideways and downside potential in the Bitcoin price due to sluggish retail demand, hesitation from institutions, and a current market cap that seems too high relative to on-chain activity.”

“I think chances are high for this year to be remembered as a shakeout year: a lemon market in altcoins, regulators catching up, and infrastructure growing pains,” he added.

Even though Bitcoin prices have plummeted up to 70% of previous all-time highs (around $20,000 in December 2017), recently, various forecasters have predicted renewed upward surges, predicting that BTC (currently at just under $6,300) will surpass the $20,000 mark by year’s end.

However, Demeester believes that the current situation does not support these bullish predictions.

“We think the market likely needs more time to absorb the recent 30 month rally, which could produce lower prices,” he said. “We don’t foresee new all time highs in Bitcoin for 2018, and unless data starts suggesting differently, we are expecting mostly sideways or lower price action.”

The day after Demeester’s article was published, the New York Stock Exchange (NYSE) owner Intercontinental Exchange announced a November launch of a regulated digital asset platform. This announcement fueled optimism around Bitcoin; however, the market has not reacted and Bitcoin is still on a downward trend from recent highs of about $8450 in July.

Regarding Bitcoin ETF, Demeester said that while regulators acknowledge its potential impact, it is not likely that regulators would officially approve the instrument in 2018.

“A Bitcoin ETF approval, even if it’s delayed, would be a huge deal because it makes the asset extremely accessible for the retail investor. After the first gold ETF went live in 2004, the gold price rallied by 350% (and it’s still 200% higher today),” said Demeester.

He concluded, “All this being said, lower Bitcoin prices ahead are not a foregone conclusion.”

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