The market cap of all digital currencies and tokens has been moving in a sideways direction for about three weeks starting on or around June 24th.
There have been some rises and some falls, but since then the global market cap has remained at around $250 billion, with trading volumes falling somewhat to now $10.8 billion.
That straight line direction is the longest sidwaying period for this year and perhaps even for 2017, with cryptos appearing to have entered a consolidation or accumulation stage.
The market probably needs to think about what it wants to do. Are coins now very cheap or should it fall below $250 billion? Might perhaps an upwards direction have legs or is it comfy here at $250 billion?
Of course, we have no answer to those questions, but perhaps fast movements up or down will now give way to slower movements in a sideways direction with a tint of maybe up or down.
Otherwise said, slow accumulation as both bitcoin and ethereum gear up for what may well be an eventful 2020 as bitcoin becomes a lot more scarce in the halving and eth cuts its inflation by some 80%.
For bitcoin, the halving is protocol determined. Likewise for Bitcoin Cash, but that’s a bit ahead so it might happen even next year in BCH.
For ethereum, the reduced miners and stakers reward kicks in when Hybrid Casper goes out. When that is exactly isn’t clear, but it may be next year.
There hasn’t been much movement today except in the Coinbase announcement of announcement coins affecting Cardano and Stellar, as well as some others.
The rest are a little bit down, with bitcoin seeing almost no movement at all. Tomorrow they may go a little bit up, but who is to know.
While that is on-going, of course there is plenty of infrastructure development and so on, plenty of growth in adoption, but price itself might be more determined by supply and demand.
The supply currently is fairly high for the two big ones. For bitcoin, for example, it currently stands at $11 million worth of new coins a day produced and probably straight out sold by miners.
For ethereum, the total reward is at around $10 million per day. So supply and demand currently appears to have reached an equilibrium of sorts, but is the reduction in supply priced in?
The future will say for sure, but if we go by bitcoin’s two past halvings, it wasn’t priced in. That’s probably because for it to be priced in everyone needs to know, and most probably don’t as most probably haven’t gone beyond the wikipedia page.
Then, there’s also the question of uncertainty, which too has to be priced in. What’s happened in the past two halving, therefore, has been a period of accumulation, with a tint of slow rising, then supply does its thing and demand overshoots, so correction kicks in and everyone goes back to what they were doing, which in this space mostly means coding.
Whether that will repeat, who is to know, but at least $20 million per day for just bitcoin and eth are betting on it. That’s not to even mention sharding.
So while traders might feel like they’re staring at drying paint, this is one of the more enjoyable quiet period. Hopefully no one starts one of those blocksize like debates however. Too much headache from that still.
Just go swim or something. Maybe namedrop crypto here and there because it might be one of those “safer” times, although of course there is no such thing and we may well see another leg down before it really starts sidewaying, or we might not. Ces la vi.