The sudden boom in the popularity of cryptocurrencies attracted many individuals and firms to float their own cryptos. As of now, over 1600 altcoins are available in the market. But one must not forget that for every working coin, there exists a failed one as well with about 1700 failed ventures. The primary reason being that people don’t buy Bitcoins because they consider it the currency of the future, they buy it for speculative purposes. This was the main driver behind the explosive rise in bitcoin’s value in 2017 from $1000 to about $19000 by the end of the year. People were operating on the greater fool theory. However, after its value dropped in 2018, people began holding out on selling/exchanging them hoping for an appreciation in their value. Since the entire industry depends on Bitcoin, once the bitcoin boom ended, the market entered a bearish phase and ICOs were able to receive much less investment in 2019 as compared to the previous two years.

The future of cryptocurrency

The growing curiosity about cryptocurrencies and the online lottery has now reached big corporate houses and central banks, with both realizing the implications and power of cryptocurrency. Facebook in 2019 announced its plans to launch its own cryptocurrency named ‘Libra’ in 2020, and this drew the spontaneous attention of almost all the central banks. Since Facebook houses a huge database, it could pose a serious threat to not only banks but the entire financial structure of countries. The wide-scale adoption of decentralized cryptocurrencies would also lead to the role of the central bank in monetary control to become defunct.

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