The co-founder of DataTrek Research has said that bitcoin is the ‘gateway drug’ to all cryptocurrencies as interest in it begins to wanes.
Speaking to CNBC’s ‘Fast Money,’ Nicholas Colas, DataTrek Research co-founder, explained that by looking at Google’s search patterns the future of the digital currency can be predicted, adding:
Going into December [searches] skyrocket. You saw that correlate to the total increased number of wallet growth.
At the time heightened interest with the crypto market saw the price of bitcoin get within touching distance of $20,000 for the first time. However, the start of 2018 has proven to be a struggle for the cryptocurrency, which has since seen it lose half of its value.
At the time of publishing, the number one digital currency is trading at $10,191, which has seen a near five percent drop in 24 hours, according to CoinMarketCap.
In Colas’ opinion interest in bitcoin is fading as other cryptocurrencies gain traction.
Bitcoin is the gateway drug to all cryptos and it has acted exactly that way. Some of the movement in ethereum, which has traded much better [in January], is just money getting pulled out of bitcoin.
Ethereum is currently valued at $1,111, and while it has seen a drop of nearly three percent in 24 hours, it has increased by 8.42 percent in seven days.
Since the beginning of the new year increasing speculation that Asia is going to regulate the market has impacted market prices. Just yesterday, new rules within South Korea came into effect banning the use of anonymous crypto trading accounts. From now on investors who wish to trade in digital currencies will need to have real-name bank accounts. There has also been talk of South Korea taxing cryptocurrency exchanges.
Yet, while the price of bitcoin is struggling to remain over $11,000 for any period of time the limited supply of it will be one factor that helps to push its price back up.