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BLOOMBERG REPORT SEES REBOUND FOR MAJOR CRYPTOS. Amid reports that China is serious about cracking down on Bitcoin by going after computer mining operations in its jurisdiction, there were other more positive notes for cryptos.
Ethereum stabilized and is climbing again. It is on a pace that may soon see it surpass Bitcoin as the number one decentralized blockchain asset in total market cap. Before the spiral and bust of cryptos in May, the Trends Journal reported on the resilience and wide adoption of Ethereum as a “smart contracts” dApps platform (see our 20 April article “Will Blockchain Save The Day?”).
A recent Bloomberg analysis underscored the utility of Ethereum, and said it was likely Bitcoin and Tether would also see relatively strong rebounds by the end of 2021.
The Bloomberg Intelligence report noted Bitcoin appeared to be in a current “cage” of between 30 and 40 thousand dollars. But it forecast that the prospect of BTC dropping to 20 thousand was less likely than it reaching and surpassing previous highs in the near to medium term.
There are several financial and blockchain-based factors that favor a crypto rebound. One is the eventual winding down of Bitcoin mining as it nears its upper limit in coins that will ever be minted. By 2025, mining supply will drop below 1 percent, while U.S. debt is predicted to continue an upward spiral.
More money will be pumped into cryptos, and the diminishing supply should result in price gains, if normal market rules apply. Of course governments and central banks will have their say. But sea changes of technology are hard to stop.
To take the case of Ethereum, thousands of dApps are creating usages and efficiencies - ie., real value - in financial exchange, prediction, asset allocations and markets.
According to the report, while Ethereum does have competitors, “the No. 2 crypto has won the adoption race as the go-to for digitalization of money and finance.”
Ethereum’s recent 10-day average trading volume, as tallied by Coinmarketcap, has grown to about 80% of Bitcoin’s from the beginning of 2021.
Tether, meanwhile, seems to finally be shaking regulatory problems. As a stable coin tied one for one to the U.S. dollar (hence its name, “tether”), it’s built for efficiency in transactions, and USDT has claimed 57 percent of all Bitcoin transactions so far in 2021.
To sum up, the Bloomberg analysis makes a case that the major crypto players aren’t going anywhere.