The value of annual Bitcoin transactions is set to slide further from the latter half of next year, according to Juniper Research.

Not only has the cryptocurrency fallen sharply from its December 2017 peak, but it has failed to recover despite the weakness of a number of leading fiat currencies, continuing uncertainty around Brexit outcomes and ongoing trade disputes between the US, China and the EU. If Bitcoin cannot make gains in such favourable circumstances, then it is unlikely to prosper as and when these issues are resolved, Juniper Research argues.

Its study, The Future of Cryptocurrency: Bitcoin & Altcoin Trends & Challenges 2018-2023, highlights that daily transaction volumes have also fallen from an average of around 360,000 per day in late 2017 to just 230,000 in September 2018. Meanwhile, daily transaction values were down from more than $3.7 billion to less than $670 million in the same period.

Furthermore, national and state governments are imposing additional restrictions on (and conducting criminal investigations into) cryptocurrency exchanges. And visibility and reach have also been severely curtailed by advertising bans introduced by leading social media companies, including Google and Twitter.

Meanwhile, the ability of casual investors to buy Bitcoin has been significantly reduced by the decision of many financial institutions to prevent purchases via credit cards.

A bubble waiting to burst?

The study also cast doubts on the longer term prospects for Bitcoin, due both to closer regulatory scrutiny and, ultimately, the rationale behind its valuation.

Report author Dr Windsor Holden comments: “Bitcoin has no intrinsic value. Like any asset, it is worth whatever someone is prepared to pay for it, but it has no meaning or existence beyond the confines of the ledger. It is a bubble, and there is a strong possibility that this bubble could burst in the near future.”