The Bitcoin price dipped briefly under $10,000 over the past 24 hours, prompting some to speculate whether the cryptocurrency had further to fall from there.
The $10,000 price range has been the norm for some time now, but the quick dip of a few hundred dollars was an important reminder about a rule in crypto changing: things can change fast.
Problems with the Lightning Network, and a general lethargy in user adoption, have put the brakes on demand.
Digital Gold Doesn’t Care About Your User Experience
Demand for block space – or the freedom to use the Bitcoin blockchain network – however, has risen. Frustration at one company who uses a great deal of the space, VeriBlock, has also come to a head this week, with one developer advocating for a reduction in block size as a way to deal with their “spam.”
Usability plays less a role in the trading markets than do factors like market liquidity and arbitrage opportunities. Especially in crypto, the name of the asset is far less important than its trading fundamentals.
Bitcoin is no different in this respect, and while it may have seen a slight stumble, the broader scope of analysis suggests that it remains on an uphill climb. Technologically, it’s still vastly superior to many of its so-called competitors, and it enjoys a market dominance unlike any other.
That is to say: if there is a crypto market that doesn’t offer Bitcoin, it doesn’t matter; and if there is a market that’s going to offer crypto, it’s going to offer Bitcoin.
Bitcoin’s Liquidity Makes It King
Which is the primary reason Bitcoin wins, for most, as an investment choice. It can be one among others, and in the others one might find more of the “blockchain” we hear so much about.
Thus far, Bitcoin has no “killer app.”
Then again, neither does Ethereum, or any of its growing field of competition. Simply being able to support “tokens” isn’t a killer application in and of itself – you need something that the world can’t live without.
As a nebulous whole, the blockchain has yet to find its roots in culture. When it does, much like the internet, it will become a state from which we cannot return. We’ll now live in a world with blockchain, where we previously lived in one without.
Whatever the case, suspicions of a Bitcoin recession are in line with those that are currently hyping a wider recession. Short-term signals may confirm such a forecast, but at the same time, there’s no good case to be made for why Bitcoin should stumble right off.
Demand will need to increase if the upward momentum is ever to resume. But currently, the market seems capable of supporting prices in the range it has been, with stronger support not far down the ladder.