Masayuki Tashiro knows who to blame for the speculative bubble that has brought the cryptocurrency market capitalisation from an all-time high of $700 billion to a record low of $200 billion.
“The biggest factor for the bubble bursting is the actions taken by beginners who don’t have the experience of investing in crypto,” he says.
Tashiro, a market analyst who is also the representative director of Fiscal Digital Asset Group and a crypto entrepreneur, believes that by strengthening regulations protection of crypto investors will increase and the amateur bubble will come to an end.
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“To begin with, there aren’t any investment measures with crypto such as PER (Price Earnings Ratio) and PBR (Price Book-value Ratio) as we see with stocks, so people shouldn’t touch upon it if they don’t understand it,” he warns. “Without any solid understanding, newbies shouldn’t get involved in crypto.”
The market capitalisation of cryptocurrency reached historic highs in December of 2017 and January 2018. The record was well over $700 billion (£550 billion), but two days ago it dropped below $200 billion (£157 billion) and has since recovered to just above this point.
Regulations will burst the bubble
“Strengthening regulations will increase crypto investors’ protection, and the amateur speculation bubble will end,” assures Tashiro. “The real value of cryptocurrency will be questioned after we leave the bubble.”
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He adds that the “overheating feeling around cryptocurrency that went on until the beginning of the year was just a bubble.”
US futures traders also to blame
Tashiro also has another group of people in his sights. “Futures traders in the US launching the BTC futures trading market last December also influenced the situation a lot. And those futures hedge funders entered the market as a tide, all at once, that influenced the bubble to burst too.”
In spite of the volatility and the hype, he is “feeling bullish” regarding crypto and predicts the Bitcoin price will rise to just over $9,000 (£7,085) towards the end of this year.
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.