Juniper Research, a UK-based consultancy, has recently released a study, labeled “The Future of Cryptocurrency: Bitcoin & Altcoin Trends & Challenges 2018-2023.“ The report claims that the end might be near for the crypto markets amid decreasing transaction volumes.
The researchers took an in-depth look into the whole crypto ecosystem, focusing on its numerous layers, such as miners, exchanges, payment processors and wallet providers. They have also analyzed key market capitalization trends and regulatory developments in major markets, such as the United States, China, Korea, Japan and Europe.
Juniper have also looked into social matters like crypto acceptance and user awareness of the basic principles of virtual currencies. Researchers have dedicated sections to assessing main causes of volatility (security issues, regulation, “forking”, etc.) and have also provided a crypto exchange index, comparing the services of 14 leading digital asset exchanges.
The researchers estimate that daily transaction volumes for bitcoin have contracted from around 360,000 a day in late 2017 to 230,000 in September 2018. Daily transaction values have decreased even more dramatically in the same period – from $3.7 billion to just $670 million.
The whole market has shrunk significantly as well. In the first quarter of 2018, crypto transactions amounted to around $1.4 trillion, while the figure in the same period a year prior was slightly less than $1.7 million. The second quarter has seen a dramatic slump, with transaction values falling by 75 percent and the market cap contracting to less than $355 billion. At one point in January, the crypto industry was worth almost $800 billion.
In the whitepaper, accompanying the report, Juniper stated that, “Based on activity during the first half of Q3, Juniper estimates a further 47 percent quarter-on-quarter drop in transaction values in that quarter […] In short, given our concerns around both the innate valuation of Bitcoin, and of the operating practices of many exchanges, we feel that the industry is on the brink of an implosion.“
2018 was supposed to be a breakout year for crypto, with the entire industry enjoying an unprecedented surge during December and the first weeks of the new year. However, an extended slump soon followed and the crypto markets have been stagnant for the past couple of months. The market has failed to rebound even amid the continuing Brexit saga and US-China trade wars. Both of these tense geopolitical events should have provided a perfect opportunity for crypto to flourish, undermining the traditional financial system.
Juniper researcher Windsor Holden added that the firm, “is aligned far more closely with the cryptocurrency skeptics than the evangelists; we do not believe a recovery to the levels witnessed in 2017 is likely… Indeed, we would argue that further falls are highly probable.“
A similar sentiment has been recently echoed by an outspoken crypto naysayer Nouriel Roubini, who serves as the Professor of Economics at New York University. He has gained fame for predicting the market collapse of 2008 and has repeatedly bashed BTC, calling it the biggest bubble in human history and saying it is more centralized than North Korea.
I have been following the crypto markets since mid 2017, just in time to witness the incredible surge of the digital asset industry. Fascinated by the potential of blockchain technology I’ve started to dig deeper and that’s how I ended up meeting the Toshi Times team. I hold a Political Science degree, therefore the crypto regulation development is particularly interesting for me. I’m also heavily involved with music, running my own label, a YouTube channel and working with distribution. People call blockchain the ‘Fourth Industrial Revolution’ and I believe it will change our daily lives in the coming years and we will have the front row seats to witness it.