Personally I see the three biggest factors as:
1. Rampant speculation. Note that a relatively few "investors" hold a fairly large percentage of BTC in particular.
2. Capital controls and wealth protection in certain countries (most notably China and Russia); and
3. Illegal activity (including money laundering).
If I had to guess, probably in that order (from high to low). The seedy side of this (3) is obvious and (to my detriment) is why I steered clear.
Cryptos may have been envisioned as an alternative currency but it's clear they're behaving far more like an asset class and that they have some bad properties for a currency to have, most notably the deflationary aspect and the inability to manage the money supply (which some will view as a positive).
It's really anyone's guess what happens from here. Thing is though, even though an individual coin is limited in supply my personal belief is that this will even out when people realize that different coins are essentially commodities so new ICOs are what will meet demand. I'm not sure when we'll get there however.
1. Rampant speculation. Note that a relatively few "investors" hold a fairly large percentage of BTC in particular.
2. Capital controls and wealth protection in certain countries (most notably China and Russia); and
3. Illegal activity (including money laundering).
If I had to guess, probably in that order (from high to low). The seedy side of this (3) is obvious and (to my detriment) is why I steered clear.
Cryptos may have been envisioned as an alternative currency but it's clear they're behaving far more like an asset class and that they have some bad properties for a currency to have, most notably the deflationary aspect and the inability to manage the money supply (which some will view as a positive).
It's really anyone's guess what happens from here. Thing is though, even though an individual coin is limited in supply my personal belief is that this will even out when people realize that different coins are essentially commodities so new ICOs are what will meet demand. I'm not sure when we'll get there however.