Why is the market value of virtual currency declining
the price of bitcoin is determined by supply and demand. When the demand for bitcoin increases, the price of bitcoin rises; As demand decreases, prices fall. At present, only a few bitcoins are in circulation, and new bitcoins are issued at a predictable rate of graal decline, which means that demand must follow this inflation level in order to maintain price stability. Compared with the market scale it may become, bitcoin is still a relatively small market at present. It does not need a lot of money to make the market price fluctuate up and down. Therefore, the price of bitcoin is still very unstable.
bitcoin price has been cut by the waist
how to implement blockchain application is still the main problem. In addition to bitcoin, the large-scale application of blockchain in other scenarios has not yet reached the commercial stage. Looking back to the second half of 2017, the price of bitcoin almost reached a new high every day, and finally reached the peak in the South Korean exchange with the highest premium in the world - about 140000 yuan per piece. On June 3, 2018, as of press time, coinbase bitcoin trading platform quoted 49688 yuan, and the price of bitcoin has been cut. Since the beginning of this year, the price of bitcoin has rarely seen eye popping ups and downs, and the overall trend of monthly decline
bitcoin development status
according to the data of the in-depth analysis report on business model innovation and investment opportunities of the blockchain instry released by the foresight Instry Research Institute, bitcoin prices showed a downward trend in May, with the overall market value falling from US $157.3 billion at the beginning of the month to US $127.4 billion at the end of the month, a decrease of 19%; In addition, there are 444000 active addresses and 197000 transfers per day. From the trend point of view, the number of active addresses and daily transfers are positively correlated with the transaction price. In May, the overall trend is volatile, and the downward trend is very obvious
reasons for the steady decline of bitcoin in the past half year
how to understand the "steady decline" of bitcoin in the past half year? There are two main reasons: firstly, the most important reason is that institutional investors and speculators who have accumulated a large number of "profit" are cashing in their profits and leaving the market; Secondly, before the blockchain instry has no real application and profit model, the rise of bitcoin price can only be regarded as speculative speculation. In addition, it is an undeniable fact that the Central Bank of China has made a decisive move to close the bitcoin trading platform, which has achieved remarkable results in preventing bitcoin speculation
at present, the domestic bitcoin exchanges have basically moved to foreign countries, which has nothing to do with China. Investors operate on those platforms at their own risk
the current market is not very good. Only when the market is good, can investors find ways to participate in bitcoin investment. As the total market value of the coin circle is still small, with more blockchain applications, there is still potential in the future
over consumed blockchain
e to the "tepid" price of bitcoin, blockchain, as its underlying technology, has reached the level of "known to all women and children", and even surpassed bitcoin in recent years
recently, a series of related reports are suspected of making up for the number and full of hype, and blockchain has obviously been over consumed. In addition to bitcoin, the large-scale application of blockchain in other scenarios has not yet reached the commercial stage
with the graal deepening of the understanding of blockchain technology, domestic enterprises have laid out blockchain technology, platforms and applications, including Internet enterprises such as network, Tencent, Ali, Jingdong, Netease, major banks, financial enterprises such as Ping An of China and Huawei. In terms of application, China actively explores and promotes blockchain + applications in the form of alliance chain and private chain to help solve the pain points of related instries, improve efficiency and rece costs.
How many cryptocurrencies are there in the world
at present, there are more than 1350 encrypted virtual currencies in circulation in the world. So far, according to the total valuation given by the market price, there are 23 virtual currencies with a valuation of more than US $1 billion, 97 with a value of more than US $100 million, and 573 with a market value of more than US $1 million. All in all, the total market value of virtual currency has exceeded US $5 trillion, of which bitcoin, the earliest invention, accounts for more than half. Players generally admit that bitcoin is not the most effective cryptocurrency, nor is it the most covert and anonymous. However, bitcoin is the first one to appear, so it is the most well-known and popular one
so the question is, does the world need more than 1350 cryptocurrencies
even the players of virtual currency will doubt this. No matter how strange the world is, there cannot be so many virtual currencies. In fact, there are so many new ICO virtual currencies emerging in recent years, which complement the "Crazy" performance of bitcoin in this year. Most of these 1300 kinds of virtual currencies can't be recognized by everyone. From the beginning of ICO, there will be many loopholes that no one will fill. When there is a major adjustment in the virtual currency market, many of them will disappear automatically, which means that no one will go to mine any more
this also leads to a problem. When some of the cryptocurrencies have problems, the entire instry chain and market of virtual currency may be involved like dominoes. Even the strongest bitcoin now will also be involved, because the cryptocurrency, in the final analysis, is supported by the "belief" of players
why is bitcoin worth more than other cryptocurrencies
at the time of writing this article, the total value of bitcoin is about US $270 billion, the total value of cash of bitcoin is about US $31.7 billion, and the market value of bitcoin gold is US $5.17 billion. Since bitcoin cash and bitcoin gold are separated from bitcoin, in a broad sense, they should be counted as a part of the total value of bitcoin (of course, you can't refute me technically, just for a rough explanation). Once we add up all the branches of bitcoin, we can calculate the market value of more than $310 billion. As a result, bitcoin accounts for about 60% of all cryptocurrencies in the market
as I have repeatedly said in recent days, bitcoin is not the most effective cryptocurrency, the most advanced, the most anonymous, or even the most stable cryptocurrency. So why is bitcoin so valuable compared with other virtual currencies
it's very simple, because bitcoin has a catalytic factor, that is, the Chicago Board of trade, as well as the commodity exchange, began to trade futures as a "commodity". Then, you will naturally think that since it has been recognized by the futures exchange, will it be further recognized by the US government in the next step. Other virtual currencies are still struggling
however, we have always stressed that since the day bitcoin was traded as a "commodity", its real monetary role, like gold, has been very weak in reality, but as one of the procts of gambling. This means that we all do bitcoin as a speculative activity, rather than a real use
judging from the current situation, bitcoin is no longer the only virtual currency that soars as soon as there is news of "official support". It is like iota, a virtual currency that focuses on the principle of the Internet of things. The news of cooperation with Microsoft came in the last two weeks, and it immediately rose to more than $300. Later, Microsoft came out and said that there was no such thing, and iota immediately fell back. It can be seen that in the future, as long as the virtual currency is recognized by some big company or organization, it will soar like bitcoin
according to foreign media reports, on Monday, the price of bitcoin fell to $2526.4, with a maximum decline of 14.5%, which created the biggest decline since January 2015. A few days ago, the price of bitcoin just broke the $3000 mark, a new record, but then plummeted by more than 30%. As of the 16th of this week, the market value of bitcoin has evaporated $10 billion, almost equal to the market value of social software Twitter's $12 billion
the other reasons for the sharp decline include the sharp decline of US technology stocks and the poor outlook of investment banks on the special currency. Morgan Stanley said that "the virtual currency is like the currency of the wild west", which needs to be regulated before it can continue to rise. The previous price surge may be caused by speculation and not easy to sell
it is worth mentioning that bitcoin is not the only one that has plummeted. It is said that the prices of other digital currencies have also fallen considerably
there are risks in investment, so you need to be careful when entering
Oh my God, bitcoin has dropped by 4 percentage points. You said it didn't drop much. Are you kidding me? Don't you know that those stocks that fall or grow by a few thousandths are scared to death ? Because bitcoin is the same as those stocks, its market value is very large, so a few percentage points, even a few thousand points, will have great changes has dropped by 4%, which is a big crash. if you drop by 40%, you don't have to play. In other words, it's impossible to drop to 40%, and the bitcoin no longer exists
so I think we should look at the data in combination, and we can't just see that it has dropped by 4%, so we think that the 4% drop actually doesn't seem so much. When we buy clothes, we can get 20% off and 9% off, which is 96% off. But if we think about it, a piece of clothes costs several hundred yuan or several thousand yuan, but if you have a hundred million yuan, suddenly you drop 4%, then you will lose millions. So if we think about it in another way, the 4% is very much, because bitcoin has 21 million caps in total. In this case, 21 million caps, the value of each one is not low. In such a case, the 4% drop is very serious, so this behavior will be a big burst
suppose there are two people selling Shaobing in a market, and there are only two people. Let's call them Shaobing A and Shaobing B
assume that their pancake prices are not regulated by the price bureau
suppose that they can keep their capital (including their labor value) by selling one yuan for each pancake
suppose that they have the same number of pancakes
- all economic models are like this, and many assumptions are needed
suppose their business is very bad, and there is no one who buys Shaobing. So they stood bored for a long time
A says it's boring< B said it was boring
you who read the story say: it's boring
the market is very inactive at this time
in order to make everyone not bored, a said to B: shall we play a game? B: Yes
so the story begins
Party A pays one yuan for Party B's baked cake, and Party B pays one yuan for Party A's baked cake, which is delivered in cash
Party A will spend another two yuan on Party B's baked cake, and Party B will also spend two yuan on Party A's baked cake, which will be delivered in cash
Party A will pay another three yuan for Party B's baked cake, and Party B will pay three yuan for Party A's baked cake in cash
so in the eyes of the whole market (including you who read the story), the price of pancakes soared, and soon rose to 60 yuan per pancake. But as long as a and B have the same number of pancakes, no one will make money and no one will lose money, but their assets will be "increased" after revaluation! Party A and Party B have "wealth" many times higher than in the past. Their value has increased a lot and their market value has increased a lot
at this time, a passer-by named C. when he passed by an hour ago, he knew that Shaobing was one yuan a piece. Now he found that it was 60 yuan a piece. He was very surprised
an hour later, passer-by Bing was even more surprised to find that the Shaobing was already 100 yuan a piece
another hour later, passer-by Bing found that the price of Shaobing was 120 yuan. He did not hesitate to buy one because he was an investor and speculator. He was sure that the price of Shaobing would go up, and there was still room to go up. In addition, someone gave a "target price" of more than 200 yuan (in the stock market, he was called a shareholder, and the person who gave the target price was called a researcher)
under the demonstration effect of "making money" of Shaobing A and Shaobing B, and even the demonstration effect of passer-by C, there are more and more passers-by who buy Shaobing, more and more people participate in the business, and the price of Shaobing is rising. All people are very happy, because it's very strange: no one is losing money
at this time, you can imagine that the one who has less pancakes, that is, the one who has less assets, will really make money. Those who participate in the purchase will make money if they don't have pancakes! And those who sold it regretted it - because the price of pancakes is still rising rapidly
who lost money
the answer is: no one is losing money, because many people who pay a high price to buy Shaobing hold a recognized high-quality equivalent asset - Shaobing! And pancakes are obviously better than cash! How much interest can cash deposit bank have? Which is comparable to the soaring price of pancakes? Even we all agree that the market is short of demand for Shaobing. Can we buy Shaobing futures? So there are warrants
someone asked: will you never lose money when you buy Shaobing? It seems so. But the world is so strange. Suddenly, a man named Li Zi came to the market. Li Zi said, "when you lose money! Which day will everyone lose money
suppose one: there is a price department in the market, who thinks that the price of Shaobing should be one yuan each Hypothesis 2: there are a lot of pancakes in the market, and the price is one yuan each Hypothesis 3: there are many procts available for playing this game in the market Hypothesis 4: you suddenly find that this is just a pancake Value discovery)
Hypothesis 5: no one is willing to play the game of trading with each other any more The truth is clear)
if one day, any hypothesis appears, then on this day, people who have pancakes will lose money! So who made the money? Is the least possession of assets - pancake people
the story of selling pancakes is very simple. Everyone thinks that people who buy pancakes at high prices are fools, but let's look back at the people in our stock market. This is not the case with some of the so-called asset revaluation and asset injection in this market? In the case of high P / E ratio and high asset premium, the principle of asset injection is the same as that of selling pancakes. Whoever occupies the least assets is the one who makes money and the one who gains high returns
therefore, as an investor, we should treat asset revaluation and asset injection rationally, cheat others, not ourselves, especially our own money
for the asset injection under the high P / E ratio, especially for the backdoor listing of securities companies, the purchase of large shareholder's assets by additional issuance, the real estate of additional issuance and so on, we must polish our eyes and be cautious again
because you are likely to become a passer-by with high price pancakes.