Right around Bitcoin Cash’s hard fork in November 15th (even hours before it took place) the crypto markets experienced a collapse of epic proportions that the industry is still slowly recovering from. Bitcoin (BTC) price fell from nearly $6,500 at the start of November to less than $3,300 in a matter of weeks. Right now, it has shown a better face and is hovering around $3,900, at the time of this writing.
Not only are cryptocurrencies still struggling to regain their value after such a hard hit, but business and investors are still suffering the consequences of it. Hundreds of commercial establishments were severely affected by the 80 percent drop of the digital coin from its record high at the end of 2017 and to start 2018.
According to a report from a British famous news network, alongside investment portfolios, the collapse claimed mortgages, loans, marriages, and college or university funds for investors’ sons and daughters.
The Wrong End of the Curve
We are already acquainted with the damage that the market crash had on American and Asian investors, but the report explains the extent of it on British retail investors, those who started investing heavily in Bitcoin at the end of 2017, right at the higher part of the curve (when it reached $20,000 in late December – early January,) only to be left with disappointing losses.
The report explains that the typical British Bitcoin buyer at the end of last year wasn’t driven by realistic or planned investment strategies, but instead, its main motivator was “not missing out” on the phenomenon.
As a result of wanting to get rich overnight without much effort, lots of UK retail investors registered new companies purportedly involved in blockchain technology. Data from the UK Companies House tells us that 340 of those firms were dissolved or liquidated this year, while the 2017 number was just 139. All in all, 58 percent of blockchain related businesses registered in the United Kingdom during Bitcoin’s higher “peak” didn’t survive.
Hugh Halford-Thompson, a renowned blockchain entrepreneur, provided his view on the matter: “There was a lot of people getting in, and I think for the first time I felt there were a large number of people who really didn’t understand what they were getting into as well. So every Uber driver I had either had invested or was thinking about it. I had people asking me genuinely which coin to put their children’s university funds into. That’s not good. I didn’t follow up with them, but I hope they didn’t. For the first time a lot of normal people who didn’t understand investments made or lost money in fairly big ways. It’s a lot worse when it’s the general public.”
After peaking at nearly $20,000, it was worth nearly half of that by the month of March. For a couple of months between September and November, it hovered around $6,000 and $6,500, but by early December and after the mid-November collapse, it was threatening to break the $3,000 barrier.
By Andres Chavez