If you were to analyze the price of the top 10 cryptocurrencies by market cap between March 2020 and March 2021, you would notice that they have seen a significant price increase. Of course, the biggest price jump has been made by Bitcoin. It moved from $6,250 on March 29, 2020, and on March 29, 2021, it is trading well above the $57,000 mark.
Here is a breakdown of 8 of the cryptocurrencies in the top 10 list by market cap as of March 29, 2021.
Breakdown of cryptocurrency prices on March 29, 2021
- 2nd cryptocurrency — Ethereum closed at around $125 on March 29, 2020, and is trading at $1,788 on March 26, 2021.
- 3rd cryptocurrency — Binance Coin closed at around $11 on March 29, 2020, and is trading at $271 on March 29, 2021.
- 5th cryptocurrency — Cardano closed at around $0.03 on March 29, 2020, and is trading at $1.20 on March 29, 2021.
- 6th cryptocurrency — Polkadot closed at around $2.8 on March 29, 2020, and is trading at $33 on March 29, 2021.
- 7th cryptocurrency — XRP closed at around $0.17 on March 29, 2020, and is trading at $0.56 on March 29, 2021.
- 8th cryptocurrency — Uniswap started to see active trading in September 2020. On September 18, 2020, it closed at around $6.9, and now, it is trading at $28.6.
- 9th cryptocurrency — Theta closed at around $0.07 on March 29, 2020, and is trading at $13 on March 29, 2021.
- 10th cryptocurrency — Litecoin closed at around $39 on March 29, 2020, and is trading at $194 on March 29, 2021.
Expert opinion on the cryptocurrency market
If you look at the cryptocurrency list price, you will be impressed by how far many of these coins have come over just one year. However, while there is a growing number of crypto-curious people, there is a nearly equal number of crypto naysayers. They believe that the cryptocurrency asset class is a bubble, which is about to burst. The future of cryptocurrencies may look bright, but there are a few things that stand in the way of them going mainstream.
Regulatory issues
According to the IMF chief, the regulation of cryptocurrencies is inevitable. Some countries have completely banned their citizens from trading cryptocurrencies. So, government regulation is the ultimate stamp of approval for digital coins. As long as leaders continue to take a controversial stance on crypto money, the fate of cryptocurrencies will remain a probability, not a certainty.
Interoperability
At the moment, it is not possible to seamlessly send transactions from one blockchain to another. This lack of interoperability means that intermediaries are needed to facilitate communication from one blockchain to another. But, there are blockchain systems like Polkadot that aim to solve this issue. Until they are fully functional, the lack of interoperability is a great hindrance to cryptocurrencies getting a wider audience.
Scalability
One of the biggest arguments against Bitcoin specifically is its lack of scalability. This is due to two main reasons. First, a lot of energy is needed to add a new block to the blockchain. Second, blocks contain little transaction data considering that they take about 10 minutes to form. If you look at intermediary payment systems, they can handle many transactions per second (tps). PayPal can handle about 190 tps, and Visa — 1,700 tps. Bitcoin can handle about 7 tps. If Bitcoin is to gain worldwide usage and get adopted as a payment method, it would need to be able to handle many more transactions than it can now.
Newer cryptocurrencies have made efforts to improve their tps numbers. However, they would need to upgrade significantly to be able to handle transactions on a global scale.
Market risk
Any person who wishes to venture into cryptocurrency is often given one standard piece of advice; they should have a high-risk appetite. This is because the prices of cryptocurrencies can fluctuate wildly — sometimes, even within the span of a few hours or days. It may be possible for people with a lot of capital to withstand the large swings, but not for those with smaller investments. Additionally, such fluctuations may affect organizations’ willingness to accept cryptocurrencies as payment. Companies risk getting significant losses if paid during a downswing.
Conclusion
There are many benefits that will accompany shifting from fiat currencies to cryptocurrencies. But, so many issues need to be ironed out as well. Still, there is a reason to be hopeful because new cryptocurrencies are being launched with solutions to these problems. It means that the mass cryptocurrency uptake may not be too far in the future.
*This is NOT financial advice and does not represent the opinions of the owners of this website.
