Sunday, April 1, 2018

Have cryptocurrencies reached their Dot Com bubble equivalent of the year 2000 as Exchanges preparing to dump dying cryptos

It was the start of the new millennia when the Dot Com tech bubble officially ended, and where in November of 2000 the sector had lost $1.755 trillion from its combined all-time market cap high.  And subsequently following this crash, barely 5% of the 290 companies in the index would go on to survive.

The Bloomberg Internet Index contains Web retailers, Internet infrastructure firms, Web advertising companies, Web portals and makers of networking equipment. Some of the largest losses on a dollar-value basis came from networking equipment giant Cisco Systems (CSCOResearchEstimates), which has lost $210 billion in market value from its peak; the Internet incubators CMGI(CMGIResearchEstimates) and Internet Capital Group (ICGEResearchEstimates), which have lost a combined $100 billion from their apex; the Web portal Yahoo! (YHOOResearchEstimates), which shed $102 billion, and America Online (AOLResearchEstimates), which is worth $92 billion less than at its highest point. 
Of the 280 stocks in the index, 79 are down 90 percent or more from their 52-week high. Another 72 are down 80-89 percent. Only five are down less than 5 percent. 
The collapse of the Internet bubble, perhaps one of the largest financial fiascoes in U.S. history, came after a three-year period, starting in January 1997, when investors would buy almost anything even vaguely associated with the Internet, regardless of valuation. Investors ignored huge current losses and were willing to pay 100 times expected earnings in fiscal 2002. They were goaded by bullish reports from sell-side securities analysts and market forecasts from IT research firms, such as IDC, Gartner and Forrester Research. – CNN Money
Many analysts have come to equate the cryptocurrency sector as similar to the Dot Com bubble, especially in their respective trajectories where they first experienced skyrocketing valuations, followed then by just as heavy declines.

According to, a website which tracks the prices of 1,594 coins traded on 10,000 exchanges, the total market capitalization of the cryptocurrency market has fallen from a high of $827 billion on January 7, to a low of $251 billion Thursday. 
Bitcoin alone has seen more than $200 billion wiped off its market cap since its price hit an all-time high of $20,000 in December. On Thursday, its price plummeted from $7550 to $6330 in the space of 12 hours before making a modest recovery. - Vice
As we begin the month of April, a paradigm shift has taken place in the cryptocurrency sphere following a devastating month for individual cryptos, and the overall market cap of the sector.  And this is now leading Exchanges to begin to remove a number of cryptos from their trading platforms as they are being deemed as DOA.
Bittrex, a major US-based cryptocurrency exchange, said it would remove a total of 82 altcoins from ‎its listings by March 30. The majority of the delisted alternative cryptocurrencies have broken blockchains, were abandoned by their developers, or were acknowledged as scams or pump and dump schemes.
However just as the majority of Dot Com tech companies from the late 90's boom would disappear forever or be swallowed up by larger corporate entities, a few would go on to survive and in fact establish themselves as some of the most valuable companies in American history.  And going forward, investors will be watching to see if some cryptocurrencies will be able to follow this same path, and survive to become high valued mainstays in the financial system.


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