People are accepting cryptocurrencies better than earlier. Though the performance of the crypto market was a bit unstable in the year, experts wish for a better market next year.
Where the fiat money exchanges and stock markets are entering the bear status, experts believe that the crypto market has a great chance to perform the best next year.
A former portfolio manager who now heads a cryptocurrency and digital assets management firm Ikigai, tweeted today which meant that cryptocurrencies have never survived during a bear situation in the traditional market.
Bitcoin (BTC) came into existence at the beginning of globally coordinated QE. There are huge chances of crypto to be the best performing asset in 2019.
The U.S Federal Reserve started quantitative easing (QE) a decade ago. It caused a fall in the interest rates and the buying of government bonds and mortgage-backed securities worth trillions of dollars.
This money saved the US economy from the major economic depression. Witnessing this, other global economies followed the same thread and bought government bonds to increase the liquidity in the market and boost the own economic growth.
By the end of 2017, the US Federal Reserve decided to hold the matured investments and hence, did not reinvest them. During the same period, central banks of Japan and the European Union slowed down their purchases.
In October 2018, the world’s largest central banks collaboratively declined their bond holdings.
Rise in the interest rated by the US federal is again a step forward in the normalization of the economy. This allows economies to function without the intervention of central banks.
This change, along with other unstable economic factors is causing the fear of global recession. The traditional assets markets are reacting to this and showing negative trend already.
Cryptocurrencies came into existence in 2009, right after the US started QE and since then it has not been a part of the traditional asset bear market. Ikigai head, Kling said that he is sure that crypto would bottom out before traditional asset. Tweet by the Kling has attracted multiple replies, and some say that crypto would keep falling, while others state that the believers in the digital asset will lead to the charge and spur in a reversal of the crypto assets market.
This might happen as more than $30 billion are put back in the cryptocurrency market in the past week. If the crypto market outperforms all other traditional assets in the coming year, it would surely earn a fixed position in the world economy. What happens in the following year, is to be seen.