Saleh Stevens Says Buyers Beware: Credit Creeps Into Crypto
Towards the end of 2017, many investment specialists and experts such as Saleh Stevens found themselves being closely questioned about the future of cryptocurrencies in the 21st-century. The many different questions being asked about currencies including BitCoin and Ripple included whether a bubble was forming around the cryptocurrency markets and what the introduction of higher levels of credit means for these digital currencies.
The rise of cryptocurrency
The introduction of credit into the cryptocurrency markets is something many of those who have been mining and investing in the currency have been averse to encouraging as for many the ethical nature of working Online to develop a high earning form of currency is a major part of the attraction of these markets. However, 2017 saw many people begin to look to take advantage of the growing trend for cryptocurrency investments through the use of credit cards, mortgages, and traditional loans to gain a foothold in one of the fastest growing markets of 2017.
Bitcoin has become the best known of all the cryptocurrencies as this was the original mined for and has grown a massively inflated market based on the fact only a small and finite number of these coins can be mined. The original cryptocurrency saw an amazing drive up the values of currency markets in 2017 when its initial value was just $800 per coin in the first weeks of the year and finished 2017 with a value of more than $11,000 per coin.
Credit could see the start of a bubble
One of the main fears many experts reviewing cryptocurrencies on a regular basis such as Saleh Stevens have addressed is the fear of a tech style bubble forming around the digital currency markets. Some experts fear those who do not have any knowledge of cryptocurrencies are leveraging credit for themselves in a bid to take advantage of the inflated markets in the belief they will continue to rise with little thought about how their lives will be affected if a bubble is formed and eventually bursts. Many leading investment specialists who saw the tech bubble of the late 20th-century and early 21st-century burst and cost them a large number of their fortunes have stated their fears over the arrival of cryptocurrencies as a major market for those not experienced in investing.
If a bubble is formed the main fear for many investment experts is the loss of a major amount of money by those who are left with little to no way of repaying what they have borrowed over the course of 2017 and 2018. Forbes reports the rise of a millennial group who wish to live in a cashless society has aided the rise of cryptocurrencies in their many forms and also built a large amount of fear among more traditional traders and investors.
Beware of the lack of regulation
2018 could be the year when regulation of the cryptocurrency markets becomes a very real part of everyday life for the majority of individuals looking to extend their investment strategies into the newly created currency markets which could include trading desks opening at the majority of major financial institutions. Many traditional institutions have steered clear of the different options in cryptocurrency trading as they fear the lack of regulation seen across these markets; the fear of fraud and hacking has meant many major financial institutions have steered clear of these digital markets for fear of the issue of a loss of pride and prestige if they are defrauded or hacked.
Bitcoin was designed to avoid the major use of credit on the markets
Cryptocurrencies have long been held as the highwater mark for those who are looking to avoid the potential risks of the major markets where shares are sold without an investor largely having an idea of how much of a business they own. Coindesk reports many financial institutions have been shown to have sold more shares in some companies that actually existed in a practice often cited as a reason for the development of cryptocurrencies.
The use of credit to embark on getting rich quick schemes involving cryptocurrencies is part of a growing trend which goes against the principles of the development of the original currency. As more individuals see the chance of financial success linked to cryptocurrencies, the number of those looking to defraud potential investors or hack into markets in a bid to extend the development of criminal gangs.
Whether the use of blockchains linked to each coin mined in cryptocurrency development can resist the issues of fraud and hacking remains to be seen but the rising use of credit is seen as a threat to the success of cryptocurrencies in the coming decade. A major issue with credit could be seen if a bubble is created around cryptocurrency trading which could affect a range of markets as more individuals explore the financial opportunities offered by digital currency trading.