After a rather lackluster start to 2018, Bitcoin and Altcoin are enjoying a small resurgence. There are now an estimated 1,597 cryptocurrencies trading in 10,679 markets. The market capitalization as of May 8, 2018, is hovering around $432 billion. However, Bitcoin’s dominance has decreased with its market share sitting at 36.2%.
At the time of writing, Bitcoin (BTC) was holding firm with a price above $9,178 and a market cap of $156 billion. The top 5 cryptocurrencies include Ethereum (ETH) at $740 with a market cap of $73.5 billion, Ripple (XRP) at $0.80 with a market cap of $31.7 billion, Bitcoin Cash (BCH) at $1,576 with a market cap of $26.9 billion, and EOS at $18.20 with a market cap of $15.3 billion.
Cryptocurrency prices exploded in the fourth quarter of 2017, despite the fact that this innovative blockchain technology and global payments system has been around for over a decade. The bigger question is how to understand what it’s all about.
Perhaps the most comprehensive cryptocurrency definition is offered by Wilkins Finance. According to this leading trading platform, a cryptocurrency is a digital asset which is transferable between people or parties on an electronic network. It’s possible to use digital currency as a medium of exchange, much like cash or as an investment vehicle. When choosing cryptocurrency’s for investment purposes, it needs to be securely stored, traded or exchanged on a network.
There has been significant interest in cryptocurrency trading in recent months, thanks to its adoption by major financial institutions, banks, and credit card companies. We have seen a large number of companies switching to blockchain technology. Among the many companies that now use blockchain technology such as Ripple, are the following:
- UAE Exchange
- xVia
- Santana
- American Express
- FairFX
- The Saudi Arabian Central Bank is in Partnership with a Cryptocurrency Corporation
Additionally, various financial institutions are now experimenting with all sorts of distributed ledger technology. This includes UBS, HSBC, JPMorgan, Credit Suisse, and Barclays. Blockchain provides many profitable opportunities for banks and financial institutions that have struggled with slow transaction processes and high costs associated with international money transfers. Cryptocurrency’s like Ripple have fast gained acceptance as a means of expediting international transactions, with bank and non-bank entities alike.
What Drives Cryptocurrency Values?
Cryptocurrency markets react to speculative sentiment. It is difficult to pin down precisely what causes prices to spike. Some might say the adoption of this technology by banks, financial institutions, and e-commerce platforms plays a part. Cryptocurrencies are extremely volatile. Prices can rise or fall at a moment’s notice.
These virtual assets are not tied to anything tangible such as gold bullion stores, the USD, EUR, GBP, or any other underlying assets. However, digital currency is an idea that is gaining traction with users. Bitcoin may not be the fastest, the most efficient, or the cheapest way to seamlessly transact. However, it is a pioneering digital currency that led to the boom evident in the world today.
Blockchain technology has widespread applications, and the digital currency that is associated with it tends to move in lockstep with adoption rates globally.
