As the day progresses, we are witnessing some interesting developments in the world of cryptocurrency. With most markets in the deep red right now, it’s all the more surprising that the Lisk price is in the green. More specifically, its value has increased by 13.25% in the past 24 hours. As a result, we now have a Lisk price of over US$26, although it peaked well above US$33 earlier today.
LISK PRICE GETS A MASSIVE PUMP
More often than not, hype and speculation result in very odd price movements. In the case of Lisk, its price got a major bump because the altcoin is being listed on a new exchange. This had such a powerful effect that the Lisk price went from US$22 all the way to US$33 in one swift move. Such an uptick is never sustained for more than a few minutes, though, and a market correction set in pretty shortly afterward.
Even so, we now have a Lisk price of over US$26, which is a nice 13.25% increase compared to just 24 hours ago. With a lot of profit-taking already behind us, it will be interesting to see whether the price dips to US$22 again or find some stability between US$26 and US$30. The way things are looking right now, it seems more likely the Lisk price will remain above US$25, but reaching US$30 again today will be very difficult.
Such odd price movements are nothing new in the world of cryptocurrency, though. Every time a medium or large exchange adds a specific altcoin, the value of said token is bound to appreciate rather quickly. Such hype cycles usually last for two to three days, after which things return to normal as if nothing had happened. Being listed on exchanges doesn’t grant Lisk extra use cases, hence the Lisk price shouldn’t necessarily rise to over US$10 as a result.
Experts: Bitcoin at “Crucial Juncture” as 2018 Is Primed to Be Defining Year
Mohammed A. El-Erian and Roger McNamee are in agreement: as we enter the new year, the Bitcoin market is at a critical point in its development. In separate articles, both financial experts expressed their beliefs that, following a meteoric rise in 2017, the near future will define how history views Bitcoin in hindsight.
TIME FOR A NEW PARADIGM?
“[In] the waning days of 2017,” Mohammed A. El-Erian writes in an op-ed for Bloomberg, Bitcoin’s “market is at a crucial juncture.” A chief economic adviser at Allianz, El-Erian argues that “the market finds itself at an important juncture – perhaps even a defining one.” In light of the recent holiday dip, he believes that “this sharp price correction will act as a catalyst for expanding what, until now, has been quite limited institutional involvement in this market – or it will become a stage in the deflation of a remarkable and historic asset bubble.”
Recently, Bitcoin has gone into a free fall from its all-time high of US$20,000 reached on December 17. For new investors in the cryptosphere, this correction was likely a harsh first lesson in an unconventional, extremely volatile market. For market veterans, it was just another day at the office – another hard-to-stomach correction after a butterfly-inducing bull market ride to new all-time highs.
As El-Erian points out, Bitcoin rode the crests and troughs of this rollercoaster market with the help of a dedicated, relatively small investor base.
Long positions in Bitcoin – “that is, those who bought bitcoins outright, either as an investment or as a trade – are dominated by individual (‘retail’) investors,” he writes. “Meanwhile, large institutional investors (such as traditional mutual funds, Wall Street banks and established hedge funds) have generally remained on the sidelines, even though their involvement is key to bitcoin’s sustainability.”
Further, in the wake of Bitcoin’s Christmas correction, “the most important question facing it is whether the recent price correction will prove to be what market participants refer to as ‘healthy,’” according to El-Erian. Given the size of the market’s investor base relative to its 2017 growth, he argues that a healthy correction would be “one that serves to shake out excessive irrational exuberance, provides for the entry of institutional investors, encourages the development of market-deepening products, and widens and balances out the investor base and the product offering.”
In a separate CNBC interview, Elevation Partners cofounder Roger McNamee echoed El-Erian’s observation that Bitcoin has so far subsisted on marginal investment capital.
It’s “still a very small market in the context of the larger financial world, but it has had a huge year. We’ve done it around a speculative mania,” McNamee stated in the interview. He also believes that, if this mania continues, Bitcoin may become “self-fulfilling” and emerge from a potential crash as “a legitimate industry.”
“With the amount of activity going on around it, there are people willing to invest the kind of dollars it takes to make a thing like bitcoin into a long-term part of the financial market.”
McNamee holds that, as an asset, Bitcoin is still too young for anyone to make a judgment on how it will mature in the financial sector over the years to come. He does believe that 2018, though, will be critical for outlining this future.
“You’ll have these big swings, up and presumably down, as well. And, you know, wherever that settles out I think will tell us a lot about the role of bitcoin long-term,” he said.
Whether or not the bubble will pop or be inflated to new parabolic highs in 2018 remains to be seen; we don’t have a crystal ball, and neither do the world’s business leaders.
But according to McNamee, it likely won’t “be the end of the story either way.”
Photo via Pixabay
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With US$274.15 million worth of 24-hour trading volume, there certainly seems to be a big demand to both buy and sell Lisk right now. Do keep in mind this volume reflects the massive price pump to US$33 earlier today, and the subsequent selloff that pushed the price to US$26 and change. If this trend keeps up, there is a good chance that US$25 won’t be solid support for all that long. It will all depend on what the Bitcoin price does during the next 12-18 hours, as that is still the main market to keep an eye on right now.
Binance is currently the leading Lisk exchange in terms of trading volume. Its BTC and ETH markets are both among the top five as of right now. Bittrex, Upbit, and Bit-Z complete the top 5 in that order. Upbit is the only fiat currency gateway for Lisk in the entire top 5 right now, which means people are simply buying cheaper altcoins in order to accumulate more Bitcoin. This may eventually result in a steep Lisk price drop later today or tomorrow.
As is always the case in cryptocurrency, there is no indication as to how the markets will evolve later today. With the current 24-hour losses visible for all top coins, there’s a lot of work to be done before things can return to normal. Even though Lisk gained 20.21% on Bitcoin over the past 24 hours, it is doubtful that ratio can be maintained for much longer. There is a lot of money to be made and lost when the markets are so volatile; that much is rather evident.
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