Ok, we’re all depressed. Crypto is tanking, and many companies funded by ICO’s are finding that there’s no good money left in their wallets, or in the universe.

Both bitcoin and ether have lost two-thirds of their value since the glory days of December-January. Plenty of people are saying I told you so, a scam is a scam, and this crypto thing is only going to get worse, day by day, until it’s dead. For them, there is no up after we hit bottom, because, to put it simply, bitcoin and its ilk are Madoffian scams. These negative nabobs of despair include Paul Krugman, of the New York Times, Ken Griffin, CEO of Citadel, and Dr. Doom himself, the New York University professor Nouriel Roubini, who has said bitcoin believers are suckers. This may be expected from old-school economists who most likely don’t own coins, and yes, Krugman once said the Internet was no more important than the fax machine, and yes, Roubini predicted 10 of the last 2 meltdowns.

Dr Doom, at his most Doomy. PHOTO CREDIT: Twitter.

But, still, the question must be asked: was the cryptocurrency boom nothing more than a bubble?

Absolutely not, say the faithful—the influential traders, smart hodlers, dedicated builders and stay-the-course dreamers. There are plenty of people still in this for the long haul, and they continue to believe in web3 and a bright crypto future.

There is, however, even among the true believers, sharp disagreement about how we get there. On one side are the people who believe we have hit bottom. And on the other are those who suspect we have a lot farther to fall.

Voices in the crypto crowd

Alex Kruger, a well-respected, former banker turned crypto trader, has a lot of opinions that he shares daily with his 15,000 twitter followers. He asserts that we haven’t yet seen the critical point at which investors give up on recouping lost investments. That's known as capitulation, and it would signal that the coins have fallen as far as they will go. Of course, knowing when that occurs is itself a science, and open to interpretation.

Still, he maintains that the direction of the market is uncertain; speculating on when it will stop falling is a waste of time. “Those charting and calling bottoms are best ignored,” he tweets.

You'll need to click this one to read Alex's summary in full. PHOTO CREDIT: Twitter

John Cotton, head strategist with the BCB Group, which caters to institutional crypto investors, disagrees. He believes that we have hit bottom:  The “long awaited capitulation is fully under way, and possibly now finished, with the last retail investors finally throwing in the towel en masse. Everywhere I look people are bearish, with extreme fear in the air.”

However, as Cotton’s extensive charts argue, while ether and litecoin have fully corrected, bitcoin is a whole other animal. Its lows aren't quite that of the altcoins, yet they remain consistent when compared to bitcoin’s behavior in the last few years. Cotton sees bitcoin as most likely having bottomed out, but cautions that this doesn’t mean it’s going to shoot back up any time soon.

(Tell that to the bitcoin maximalists, who see the coin’s high, presumptive  bottom as further proof that it’s going to conquer the world—while all the altcoins, including ethereum, fall by the wayside. Bitcoin tattoo, anyone?)

Bottom? We're nowhere close to it yet, scoffs Anthony "Pomp" Pompliano, who, among other things, writes the influential crypto newsletter Off The Chain. His distinguished resume includes high-profile product stints at Facebook and Snap after serving for six years in the U.S. Army, where he fought in Operation Iraqi Freedom.

In a tweet heard round the world over the weekend, Pomp opined: “Crytpo prices keep dropping, but people still believe the price will rebound quickly. There is no blood in the streets. There can’t be a recovery until people forget about the last bull run and truly believe crypto is over.”

Is it really over? PHOTO CREDIT: Twitter 

The bears meet the bull

Many observers blame Ethereum's lows on a flood of irresponsible ICOs that overspent, or started to fail, and then had to unload their ether at low prices to survive. Most notable among the finger pointers is Meltem Demirors, chief strategy officer at Coin Share, who offers a vivid illustration of this phenomena in her slidedeck, “How Not to be a Shitcoin”.

Meltem, like many people, points to all the ugly ICOs of the past year, many of which have simply cashed out and disappeared, flooding the market with ether. Others were poorly managed businesses that needed infusions of fiat currency, requiring the company to sell ether to raise cash, further flooding the market, and depressing prices.

Demirors's solution, which sounds an awful lot like what people were saying in the nuclear winter after the dotcom implosion: build good companies that make real, useful products, and have a long-term vision. Stop thinking so much about getting rich, and think more about giving customers great experiences. Of course, that, too, is easier said than done.

No one knows if, and when, crypto is going to go back up. Predicting the timing of market fluctuations is as impossible in crypto as guessing the ups and downs of the traditional stock market. And, speak of the devil: the stock market itself, which has been enjoying one hell of a glide, looks like it could be headed for a fall. According to the below chart via Goldman Sachs, its bull/bear indicator is at its highest for bears since 1969:

Of course, the poobahs at Goldman aren’t saying this means a crash is imminent, but they do warn that low returns on stocks are likely for the long term. And lest you think that the dollar is doing any better than crypto right now, The Wall Street Journal reports today that the US dollar’s rise against the pound and euro in early 2018 was a momentary exception to a fall that began in 2017—and continues today.

Curiously, the illustration of a pound and a euro coin that accompanies the article looks every bit as garish as the typical blingy representation of a bitcoin found all over the web. The more things change, eh?