A Wall Street consultancy eviscerated crypto in a massive report — and it should strike fear into the heart of every bitcoin bull

FILE PHOTO: A view of Ducatus cafe, the first cashless cafe that accepts cryptocurrencies such as Bitcoin, on their opening day in Singapore December 21, 2017. REUTERS/Edgar Su/File PhotoFILE PHOTO: A view of Ducatus cafe the first cashless cafe that accepts cryptocurrencies such as Bitcoin on their opening day in Singapore Thomson Reuters

  • Quinlan & Associates put out a massive report that should strike fear into the heart of every bitcoin bull.
  • The consultancy laid out a bear case for bitcoin that puts it at just $1,800 at the end of 2018.

A Wall Street consultancy is predicting a massive crash in the cryptocurrency market this year.

Quinlan & Associates put out a report Thursday titled “Fool’s Gold: Unearthing The World of Cryptocurrency” in which they outline a case for bitcoin dropping to $1,800 by December 2018.

The 156-page report argues that bitcoin’s current price near $14,000 is far above what it is worth as both an investment asset, akin to gold, and a payment mechanism. Here’s the report:

“As an asset, we valued Bitcoin using a cost of production approach and a store of value approach, resulting in values of USD 2,161 and USD 687 respectively. To value BTC as a currency, we estimated its utilization for both legal, retail transactions payments, as well as payments in the black market. After significant testing, we calculated the price of BTC 1 to be USD 1,780.”

At its current valuation, the consultancy concludes bitcoin is a bubble “waiting to burst.” If bitcoin is not adopted as payment method, the firm predicts a major bitcoin correction to $1,800 that’ll also drag the cryptocurrency market down 70% to $223 billion later this year from its current position above $700 billion.

“‘Despite fulfilling most of the characteristics of a traditional fiat currency, cryptocurrencies are largely being utilized as speculative investment assets, leading to considerable volatility in their value,” said Benjamin Quinlan, chief executive and managing partner, in a statement shared with Business Insider.

crash.PNGQuinlan & Associates

The firm’s long-term outlook for bitcoin is even more dreary. According to the report, it sees bitcoin trading at just $810 in 2020.

Still, it sees room for growth after the crash for the cryptocurrency market as a whole.

“While we anticipate valuations to decline in the short-term in response to the widespread unwinding of the digital currency space, the price of utility cryptocurrencies is likely to recover and dominate the market in the long-term,” the report said.

It expects the cryptocurrency market to rebound — driven by those cryptos with a clear utility — and reach $407 billion by 2020.

This reporter owns a fraction of bitcoin, but does not actively trade.

Comments

comments

Filed in: Mainstream Bitcoin Tags: ,

You might like:

Most of the World's Biggest Cryptocurrencies Are Down Today Most of the World's Biggest Cryptocurrencies Are Down Today
Metropolitan Bank Denies Policy Change on Crypto Wire Transfers Metropolitan Bank Denies Policy Change on Crypto Wire Transfers
Ripple Price Drops to 2.5-Week Low, Eyes Sideways Trading Ripple Price Drops to 2.5-Week Low, Eyes Sideways Trading
Mark Cuban: Dallas Mavericks to Accept Bitcoin, Ether 'Next Season' Mark Cuban: Dallas Mavericks to Accept Bitcoin, Ether 'Next Season'
Maersk, IBM Spin Off Blockchain Trade Platform Maersk, IBM Spin Off Blockchain Trade Platform
France Creates Working Group for Cryptocurrency Regulation France Creates Working Group for Cryptocurrency Regulation
Blockchain Startup Cypherium Partners with IC3 for Scaling Research Blockchain Startup Cypherium Partners with IC3 for Scaling Research
Shipping Blockchain: Maersk Spin-Off Aims to Commercialize Trade Platform Shipping Blockchain: Maersk Spin-Off Aims to Commercialize Trade Platform
© 2018 Virtual Mining Bitcoin News. All rights reserved. XHTML / CSS Valid.