Bitcoin’s 10th Birthday Won’t Be a Happy One

Bitcoin is about to hit its 10-year mark, but by many measures it will be limping into its anniversary.

Last year was a blockbuster for the cryptocurrency, which got its start in 2008. Its price soared 1,375% in 2017 as celebrities and financiers took an interest in Bitcoin.

But Bitcoin and other cryptocurrencies this year fell into a slump that continued through the third quarter. Bitcoin’s price is down more than 60% from last year’s record high, according to data from CoinDesk. A small gain last week left Bitcoin up about 4% for the quarter.

The larger crypto market fared even worse: The combined market value of all cryptocurrencies fell about 13% in the quarter, dropping from $255 billion to $221 billion as of Friday, according to data from CoinMarketCap.

More troubling, some of the biggest, best-established cryptocurrencies dropped the most. Ether, the native token for the Ethereum network and the second-biggest cryptocurrency after Bitcoin, was down 51%, according to data from CoinDesk. Bitcoin Cash and EOS both dropped 28%.

Lately it has been difficult for Bitcoin to attract new buyers or even hold on to old buyers who are feeling burned. Logged daily transactions in the third quarter averaged 217,000, according to data from, well below the 319,000 daily average in last year’s frenetic fourth quarter.

Regulatory scrutiny isn’t helping: In August, the Securities and Exchange Commission rejected nine separate proposals for Bitcoin exchange-traded funds. That was after rejecting for a second time a Bitcoin ETF proposed by entrepreneurs Cameron and Tyler Winklevoss. Getting approval for a Bitcoin ETF could go a long way toward helping the crypto market attract mainstream retail investors, but the SEC has consistently concluded there isn’t enough transparency in the cryptocurrency markets to be sure prices aren’t being manipulated.

A comprehensive report from the New York Attorney General’s office in September shared some of those same concerns. It found that many exchanges lack basic consumer protections, leaving investors vulnerable to manipulators.

Also illustrating the downward trend is the market for initial coin offerings, which allow investors to buy a Bitcoin-like digital token related to a product or service that a crypto company plans to develop or offer in the future. The ICO market has taken in $12 billion worth of capital this year, according to data from research firms Diar and TokenData, about double the total for all of 2017. However, the firms calculate that 70% of those projects are currently valued at less than they were when the ICOs were completed. Just 17 startups completed ICOs in August, the least in any month of the past year.

Write to Paul Vigna at [email protected]

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