With the value and popularity of many cryptocurrencies still as high as ever, it’s always worth looking at how this interesting sector is adapting and evolving. From the way in which the prices have fluctuated over the last few years to the rise in the number of functions, things are ever-changing – and when fraud and crime is factored in, the situation is even more complex.
Perhaps the first major way in which the crypto market has changed over the last few years is that cryptocurrencies have started to experience downs as well as ups in value. When bitcoin and other crypto assets first became popular, they saw meteoric price rises in just a few months. Some predicted that this would transpire to be a bubble.While that’s not yet been conclusively proven to be the case, there is evidence that crypto price drops are bedding in. On one day in June 2018 alone, for example, the value of a single bitcoin saw a drop of $400 over a period of just a few hours. So for a new crypto investor, it’s worth remembering that the skyrocketing of values seen in recent years is not necessarily always going to be the case.
When a new product or trend hits the market, it’s common for it to have a very restricted scope at first. Bitcoin was originally just traded as a currency, for the purposes of either using it as a means of exchange or simply speculating on its price rises. But now, the underlying structure and mechanism of cryptocurrencies are finding themselves being used in a whole host of different markets and for different purposes. Ripple, for example, has been harnessed by banks and other financial services providers. And blockchain is also being used in fields such as healthcare to provide decentralised, secure data sharing systems.
Fraud and crime
Drops in the value of many cryptocurrencies have led some people to assume that the death of crypto has arrived, and that it is no longer worth investing in. Only time will tell if that’s true, of course – although one major negative that has emerged in recent years, and which may in part be fuelling the drop, is the rise in crypto crime. Criminals and fraudsters have taken full advantage of the hype around bitcoin and other coins: Action Fraud claims that crypto fraudsters conned British people out of £27m in the last financial year. As a result, now is the time for crypto traders to take even more care over how – and with whom – they interact in the crypto sphere.
Cryptocurrency has long since been a dynamic world, and it’s not uncommon to find changes and ups and downs in an internet-fuelled, exciting environment like this one. The reality is that the crypto markets are dynamic in both good and dangerous ways: they can be used for development purposes in the form of new functions like banking protocols, but they can also see price fluctuations, fraud and more.