There is no room for argument on the fact this week has been really rough for those who participate in cryptocurrencies. Truth is that all of us, possibly with no exceptions, are constantly having our faith in the movement tested by the markets that seem to make less sense every single day.
We try to rationalize events after the fact to no avail. Why our favorite coin dropped in valuation, why a certain analyst was wrong. All the questions that will never have an answer that will make us feel good or satisfied. In my opinion these market shakeups are part of a necessary cycle. Not because of some sort of universal plan, but simply because there are a lot of people who get into the markets believing naively that cryptocurrencies are just about easy money. This of course, is very far from the truth.
Technology & Valuation
We tend to conflate the two, and that is part of why we can't make heads or tails of anything. The idea is that because we believe that a certain currency has the right technology and philosophy, then without a doubt investors would agree with our thoughts on the matter and take the valuation to new heights.
It does make sense to analyze the value proposition of cryptocurrencies of course. It's obvious that if there is no actual use case for one, the market itself will simply use it and dump it. Sadly, that is accurate when describing hundreds if not thousands of cryptocurrencies that are currently part of the market, but fortunately that is not the case of Steem.
In the long run valuation will be directly affected by the technology if and possibly only if, the project itself is successfully launched to a wider audience. What this means to me is that early adopters of the Steem cryptocurrency are in favorable position that is not enjoyed by many other projects out there.
User Base
I've read plenty of times that Steem has a user retention problem. In the somewhat short time I've been participating of Steem I've noticed this myself, but at the same time it's also important to remember an important fact. Regardless of the user retention challenges of Steem, this blockchain is still the busiest blockchain on the cryptocurrency landscape.
What to do?
In my opinion, today is not a good day to be selling anything. Its one of those days we need to step back from the computer, write a post, read a book, call a friend, do something other than staring at the coinmarketcap. I can promise you that staring at the valuation of cryptocurrencies won't make them go back up.
I'm also of the idea that this shakeup is probably announcing a big rally. I'm willing to be very soon we will be thinking back about the day Bitcoin went under 6k and Steem touched a dollar wondering how silly we were being all scared about those prices, and not recognizing the opportunity.
So, I'm going to follow my own advice, step back, spend some time with some friends and trust that things are about to turn around soon.
BITCOIN PRICE: LOOKING AHEAD
Buying and selling volume has dried up and bitcoin will continue to wither until buyers show some interest.
Seems every week we say the next drop or pop to the nearest thousand will make or break some psychological support or resistance, so, here we go again. BTC will remain in troubled waters if it stays under $6,000 but there is support at $5,450.
[Disclaimer: The views expressed in this article are not intended as investment advice. Market data is provided by BITFINEX. The charts for analysis are provided by TradingView.]
Where do you think Bitcoin price will go this week? Let us know in the comments below!
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