GP Bullhound—an investment bank primarily focused on technology markets in Europe, Asia, and North America—boldly stated that the cryptocurrency market will be “wiped out” this year.
Towards the conclusion in its report titled “Token Frenzy, The Fuel of The Blockchain,” the company finished its “year in blockchain” outlook prediction with very ominous words about the crypto market.
“Finally, cryptocurrencies will experience a heavy correction of up to 90 per cent in the next 12 months and very few companies will survive this correction. While this correction will be critical to cutting through the hype, its lack of impact on financial institutions will create phenomena that we have never seen in any previous bubble burst,” the report read.
GP Bullhound doesn’t consider this a catastrophic thing, however, as it adds that as soon as the “crypto-winter” passes, “the growth dynamics for the precious few survivors will be unprecedented.”
In short, the company believes that an extreme price correction in the cryptocurrency market will make some operators consolidate their influence over it, leading to eventual growth in the very long term. This conclusion reveals that GP Bullhound doesn’t see the whole phenomenon flatlining entirely. Rather, much like a phoenix, it would experience a rebirth from its ashes.
In contrast, Warren Buffett predicted a collapse in January, but never stated when the collapse will happen or whether a recovery is on the horizon.
Adding to its predictions, GP Bullhound considers that the first “corporate ICO” may appear this year.
“We define corporate ICO as the transition of a formerly private and permissioned chain onto a public blockchain. This ICO will also likely be the first ICO based upon a consortium chain which will see several corporates join forces in a private, permissioned blockchain before setting the protocol free for the wider universe of early adopters,” the company wrote.
Experts at the investment bank believe that the “automotive, raw materials or luxury goods sector” would be areas to look for this kind of innovation. Indeed, we’re already seeing IBM (NYSE:IBM) establish a consortium of companies that use its blockchain technology to track the supply chain of jewelry.
If GP Bullhound’s prediction of doom and gloom for the cryptocurrency market pans out, it might not necessarily be the worst thing to happen to the market. After all, the process of creative destruction gave us a phenomenon that led to more established and reputable companies consolidating the IT sector after the crash that followed the dot-com bubble.
This article appeared first on Cryptovest
