Digitization recently entered the field of money, more importantly in a manner wherein an entire different type of currency was constituted. Of course, what we are talking about is the world of cryptocurrencies. A distinct market now exists associated with this virtual currency type from a global perspective. Bitcoin, Ethereum, Litecoin, Dogecoin, and several others are prime cryptocurrencies.
Increasing Number of Investors in Market’s Initial Days Contributed Extensive Progress
The global cryptocurrency market grew at a fantastic pace shortly after the associated transactions began with Bitcoin. This was the first ever cryptocurrency that came into existence and also has been the most commonly used one. With an increasing acceptance for Bitcoin, the global cryptoccurrency market grew tremendously. Moreover, many companies started pouring extensive investments in the market. This provided a significant impetus to the market’s growth.
The rate of a single cryptocurrency unit is quite high compared to other currency forms, thus becoming a key characteristic of this currency type. This made many people use cryptocurrencies as a source of investment in order to rake up higher returns in future. A rise in the number of such investors too ensured that the cryptocurrency market would do great in the next few years. No third party involvement, minimal chances of fraud and theft, and zero transaction fees for digital currency exchange, are three other factors that propelled extensive progress in the global cryptocurrency market
Rising Volatility and Fears about Instability Hampered Growth in Cryptocurrency Market
However, the saying, ‘the bigger they are, the harder they fall’ couldn’t be truer with regards to the global cryptocurrency market. With this sector growing vast and quite non-controllable in a small span of time, it also attracted a lot of negative scenarios. This ultimately posed as key factor restraining the global cryptocurrency market’s expansion. In recent times, the market has witnessed its largest downfall in recorded history. What once was supposed to be a highly lucrative market is now at its lowest point, especially with the fall of Bitcoin.
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In addition, extensive security challenges exist in the market. As the entire system is decentralized, the lack of supervisory control made it quite difficult to regulate cryptocurrency transactions in certain regions. Nonetheless, a spark of hope might lie with this market, mainly as efforts are going on to bring back the rate of different cryptocurrencies back to normal as much as possible. Although the cryptocurrency market is going through its worst times, its presence might improve in the near future.