The market trend whether bull or bear always has a strong psychological effect on the emotions of the buyers & sellers, affecting their decision making. It is very hard to access the price versus fundamentals at these aforesaid trends. Greed and fear are the market drivers. The retail buyers FOMO(Fear of missing out) of buying Bitcoin lead to the all-time high(ATH) of Bitcoin, almost touching $20,000 in December last year. At that time, there was more speculation of Bitcoin price jumping to $25,000 to a possible million dollar per Bitcoin. But alas!
While Bitcoin was touching its ATH, its mempool(node’s holding area for all the pending transactions) was flooded with transactions which cost fees as high as $50-$100 for buying coffee & transferring Bitcoin & the confirmation of the transactions taking days to approve. This marked a question-Can Bitcoin be the true peer to peer digital transfer of money with fast transactions as it was deemed to be in its whitepaper? So, the overnight price phenomena had to take its toll and you see where the price is right now. But that being said crypto market price don’t always follow fundamentals unlike the traditional ones. There was more to it. Something which has a parabolic growth has to fall subsequently. This is what happened to Bitcoin-a fall of 70% approximately from its ATH. But when is the end to this downtrend?
Seriously, no one knows. It is during these bear times when the fundamentals & the new developments of Bitcoin matters the most. Bitcoin’s dominance of market share has fallen over the years to 40.6% currently due to the significant last year upsurge in the altcoins market price. There is certainly serious competition to Bitcoin with total cryptocurrencies growing to a staggering amount of 1604 as of today. But the true value proposition of the other cryptocurrencies are hard to evaluate as they have yet to sustain the almost decade long struggle which Bitcoin has passed with zero downtime and free from network attacks. Also, Bitcoin’s price is 135% up than a year ago today. This is what establishes Bitcoin’s true store of value in the long run. So, Bitcoin is the true leader at the moment-one can surely say so with the price of the altcoins following Bitcoin’s price direction. SegWit and Lightning network mass implemention & adoption are the subjects of attention for the Bitcoin developers right now. What will end the bear market goes without saying is mass adoption and community network effects, which will drive the price of Bitcoin to a possible new ATH. But one can only speculate the price and direction of Bitcoin at this moment.