Meta: Cryptocurrencies have struggled in recent months, with their market value plunging. But what does the future hold for crypto, and will the digital bubble burst?
Cryptocurrency has moved from being a niche product reserved for only the most hardcore investors to a product in the limelight.
But despite the money that has poured into the crypto market in the last year, it has started to wobble in recent months. Bitcoin and Ethereum are the two largest cryptocurrencies by market share, and both have lost around 10% of their value in the past six months.
Having moved from being an alternative investment product to becoming a viable means of payment, could the crypto bubble be about to burst?
The rise of cryptocurrency has been meteoric, creating enormous wealth for anyone who got aboard early. In 2016 the total sum of all available crypto hovered around $10 billion. But by the end of 2021, it has rocketed to more than $3 trillion.
These figures seem to suggest that crypto offers guaranteed success, but closer inspection reveals that’s not the case. Although there are some which have secured a strong market position, more than 1000 attempted cryptocurrencies have withered and died.
It’s a market that has been slowly maturing, moving from its reputation as a high-risk niche investment to a reliable and solid commodity that could eventually rival gold.
In recent months crypto has endured a torrid time, being hit particularly hard by geopolitical events. This combined with a global drive to regulate the industry more closely, has led to a sell-off sending prices plunging.
While concerning for crypto investors, experts have suggested that crypto will recover and continue its climb in the longer term. This belief is built on the fact that crypto no longer operates as an isolated investment vehicle, but has diversified worldwide and now has a presence in many types of market.
Diversifying to Create Strength
As a decentralised currency, the ability of crypto to respond quickly and adjust has always been one of its strengths. And investors are seeing this again with its presence within NFTs.
Non fungible tokens – NFTs – are digital assets that have recently caught the public’s attention for the potential to monetise assets in a whole new way. The digital qualities of NFTs dovetail nicely with crypto, and the two are a natural match.
NFTs are set to be the future of investment with the ability to include all types of asset. NFTs have extended to fine art, colours and even an NFT slot, built on the ever-popular Megaways system.
In addition to the standard crypto options, a new token has been launched, which is aimed squarely at the NFT market. The Sandbox was created partly in response to the Meta brand by Facebook and is a meta world where players can make money from NFTs by using their own crypto tokens.
The metaverse, NFTs and crypto all demonstrate that the future is digital and that adapting, transforming, and adjusting rapidly to changing market conditions will be critical. Crypto has already proven that it can slot into new technology seamlessly, which is why many investors now consider it the safest bet for their capital in the future.