Cryptocurrency Nuclear Winter Is Near
Cryptocurrency has been a subject of constant debate and speculation throughout 2018. It is quite apparent that this year has not been a pleasant one for the crypto market. The poor performance has caused a worry among investors about market recovery, while major players in the finance industry continue to come up with new platforms and products, some of them being an institutional investment platform from Fidelity, and a Bitcoin product from ICE supported firm, Bakkt.
In spite of positive advancements taking place, the renowned investor, Jim Breyer, warns that the cryptocurrency market may soon undergo a “nuclear winter” phase, while also noting the excitement of technology and its future prospects.
The billionaire investor, Jim Breyer, who has significant stakes in noteworthy companies such as Dell, Blackstone and Walmart, made comments about the cryptocurrency market during Fortune’s 2018 Global Tech Forum in Guangzhou, China.
Breyer, into the final keynote session of the event, expressed his interest in blockchain technology, cryptocurrency and DLT-based companies. But further, he also shared that “we are close to a nuclear winter right now with cryptocurrency.”
The largest cryptocurrency by market cap, Bitcoin, is trading down 80% from its high record of $20,000 in late 2017. It is currently on a downfall to its low records of $3,600. Bitcoin’s poor performance has pushed the altcoins market downhill and also affected their value deeply.
Breyer emphasized crypto’s downfall is not unprecedented, and such kind of cyclical value patterns are common in many emerging technologies, such as artificial intelligence (AI) and the internet. They went through similar phase of inflation followed by deflation in the late 90s and early 2000s.
Breyer, who earned a significant amount of his wealth by investing in new emerging markets. In 2005, he took a huge risk by placing his bet on Facebook, when it was in its early stage. Eventually, the bet made him billions of dollars allowing him to start his own investment company in 2013, Breyer Capital.
According to the legendary Investor, “these cycles keep happening every decade or so.” And such an occurring is “inevitable.”
Furthermore, he believes that the blockchain technology, which provides a base support to cryptocurrencies, is being closely studied and executed by many brilliant and bright minds who dedicate their expertise to the development of technology.
“So many of the very best computer scientists and deep learning PhD students and post-docs are working on blockchain because they have so much fundamental interest in what blockchain can mean… You don’t want to best against the best and brightest in the world.”