Many currency speculators in 2017 made a mistake in his bet on the dollar, after suffering heavy losses on fluctuations of the currency.
UPS of value that occurred during the inauguration of Donald trump in January and have remained the annual maxima for the U.S. currency. Thus, the US dollar was one of the worst currencies of 2017. The dollar fell over the year from around 8% against major currencies.
The U.S. dollar showed the biggest decrease in value since 2003 and is now in a three-month minimum. At this time, Bitcoin, with a market capitalization of $227 billion at the end of 2017 and recorded a growth of 1341%, and became one of the most profitable cryptocurrency assets in the global market. Followed by Ripple, Litecoin, and Ethereum Dash.
According to some analysts, for example, Chris Gaffney, President of EverBank World Markets, the value of the U.S. dollar throughout 2018, is likely to continue to decline, with no signs of short term recovery.
“In 2018, the dollar will face a large number of headwinds. The fed will not be doing this just to “remove your foot off of the stimulus””.
Jens Nordvig, CEO of Exante Data, told CNBC that while analysts had expected a recovery after such a large loss of value, this time it happened otherwise, too many events had a negative impact on the US dollar.
Nordvig have focused on the rapid rate of growth in the world economy and the influence of key players such as China. The position of the dollar against main trading partners, which greatly strengthened in the period from 2011 to 2016, also played a role. The dollar rose more than 40% and this growth greatly outpaced the increase in real short-term yields.
“We have a negative attitude to the dollar, which is unusual, given that interest rates will rise at a very good level. By January it is only strengthened, and another factor is that global growth is very strong.”
Long-term bitcoin investors, and cryptocurrency researchers believe that their growth, as the emerging new class of assets, has little effect on the depreciation of Fiat currencies around the world, separating money and the state.
For many decades the government has kept under its control the global monetary system, particularly that part with which they can easily manipulate circulating money.
In November, the CEO of ShapeShift, Eric Vorhies noted that Bitcoin continues to grow. Growing its market cap, user base and user activity. And all because of being a decentralized currency and a means of preserving capital, it represents the best financial alternative to the existing monetary system. Voorhies said:
“Why Bitcoin continues to grow? Because it’s time to separate money and state”.
In response to criticism caused by such statement, Voorhies agreed that short-term price bubbles full of speculation, but the long-term increase in the cost due to the fact that non-state cryptocurrencies offer significant advantages.
“Short-term price bubbles full of speculation, is without a doubt. But the long-term growth in the value and the price of the cryptocurrency explained the fundamental utility of non-state Finance “.
On the eve of New Year, the financial publishing Zerohedge published a chart called “the Most important graph in the world”, which shows a decline in the value of US Treasury bonds since 1987. Bitcoin, on the contrary, over the last 9 years, except for 2014, showed consistent growth.
Thus, analysts began to consider the possible existence of a long-term bubble in the traditional Finance sector. Should we consider emerging assets, particularly Bitcoin, financial bubbles? Or should take a look at traditional financial assets, which for decades has declined in price as a long-term bubbles?