Cryptocurrency investors have been through a lot over the past one year. Last October, when the cryptocurrency bull-run kickstarted, the price of Bitcoin went from being in the $5000s to reaching an all-time high of almost $20,000 in December. However, the trends reversed and Bitcoin is once again trading in the 6000s. However, even in these dismal times, Binance CEO Changpeng Zhao continues to be hopeful about the markets. In a recent statement on CNBC’s CryptoTrader program, Zhao said that he expects a bull-run in the markets soon. Earlier this year, Zhao had stated that he expects a bull-run in Sep-Dec (Q4 2018).
Zhao, popularly known as CZ, commented that he is certain of the fact that markets will bounce back and that there will be a bull-run once again. However, he was not so certain about the specifics of how this would happen. Zhao commented that this rise in the prices will happen ‘sooner rather than later’ and added:
"Even if I don’t know what will catalyze a bitcoin bull run, I am certain it will happen... Sooner or later, something will trigger it."
Over the course of this year, the price of Bitcoin has been on a gradual, slow fall. The currency has dropped by 70% compared to the all-time high of late last year. While the price of Bitcoin has been falling, it is not an isolated incident as the entire cryptocurrency markets are being impacted. The price of currencies such as Ethereum and Ripple have also been hit - both of them being down by almost 80%. Ripple particularly took a harder hit, as it was a currency which had boomed by 36,000% over a one-year period.
Trade Volume Down but Binance is Still Profitable
Zhao also accepted that the cryptocurrency trade on the Binance cryptocurrency exchange is down by almost 90%, the company, as well as the markets continue to be healthy. The Binance CEO also added that the firm continues to be a profitable business. He said:
"Compared to January [of 2018], we are probably down 90 percent. So we only have one-tenth of the trading volume compared to what we had in January. But, compared to like a year or two years ago, we’re still trading at huge volumes. Business is still okay, we are still profitable, and we are still a very healthy business.”
After this statistic, Zhao stated that there has, however, been a steady increase when it comes to the number of new and active users on the platform. The cryptocurrency trading volume of the firm has indeed been hit - but it is recovering at a steady pace, and that there has been a significant rise in the cryptocurrency deposits in Binance’s cold wallets.
Crypto Market Cap is Twice of What it Appears
In addition to this, Zhao made a surprising statement that the cryptocurrency trading volume that is shown on platforms such as Coinmarketcap, etc. do not show the complete picture. The total cryptocurrency volume in the markets shown by these platforms are the funds that are flowing via the cryptocurrency exchanges. However, there’s also the over-the-counter [OTC] trade, which is at least as big as the exchange-led trade, implying that the total cryptocurrency market cap is double than what it appears to be.
“What I’ve heard is the OTC market is at least as large as the live recorded volumes [on exchanges]. So that is at least 50 percent of volumes that is not being reported on CoinMarketCap. But we’re not heading to that business, so we don’t know the real volumes.”
It will be interesting to see how the markets go from here on, especially with the likes of Bakkt making their debut soon. Institutional investors were expected to bail the cryptocurrency markets out from this free-fall - but they are yet to show up. Stay tuned with us at Cryptoground for more updates from the world of cryptocurrencies and the blockchain technology!