The world of cryptocurrencies is a very dynamic one, with virtually unknown coins suddenly making headlines as they rapidly grow in value. The most recent such case is the cryptocurrency Verge, that started its life in 2014 as DogeCoinDark. Some of those sudden crypto sensation go on to become major players in the altcoin markets, while most fade back into obscurity and low value. This analysis sets out to determine which of those two fates awaits Verge. Based on market, competitive and technology data, we bring you our Verge price predictions for this year.
One of the major strengths of cryptocurrency is its anonymity. Because the transactions are associated with addresses and wallets, rather than individuals, it is easy to maintain a definitive record without revealing anyone’s identity. However, most are not completely anonymous and are vulnerable to IP tracking. Verge seeks to solve those issues to provide users with a completely anonymous cryptocurrency.
It does that through the use of TOR and I2P protocols, which serve to effectively disguise the IP addresses of their users, making them untraceable. It also includes a number of technologies developed specifically for it, such as the Wraith protocol, which allows users to choose whether they want to be anonymous or not in their transactions.
This innovative use of technology can easily drive strong growth for Verge, assuming they successfully reach a user base that needs those features. Privacy remains one of the top drivers for users of other cryptocurrencies such as Bitcoin, so if Verge can position itself as a much better alternative to those from a technological point of view, it can build market share and increase in price. However, that requires it to successfully communicate how its technology can solve existing problems in order to do so.
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Verge is in a good position to take advantage of the market for more secure and anonymous cryptocurrencies, but it is far from alone in that market niche. There are strong competitors for Verge, such as Monero and ZCash, which all use different technologies to achieve privacy.
On one hand, this is a clear indication that there is a market for truly anonymous altcoins. However, it also indicates that the best technological approach to this particular problem has not been settled on just yet. If the method used by Monero, ZCash, or even a not-yet-existing cryptocurrency ends up being the best at maintaining transaction privacy, the Verge price predictions do not look very good.
Another downside of the strong competition that Verge is facing is that so far, it is far from the best performing privacy-focused cryptocurrency. Its market cap is just under 1 billion USD, while ZCash has a 50% larger market cap, and Monero’s is nearly five times larger. That suggests that those companies have a larger market share, and are likely to benefit more from demand growth in that segment than Verge is.
In December of 2017, Verge went from trading at around half a cent to nearly 29 cents per token in under two weeks, before proceeding to see-saw up and down for the next month and a half until eventually settling down by the end of January as the entire cryptocurrency market slowed down. These rapid increases and decreases in price are usually a sign of a cryptocurrency that is being driven more by hype and speculation than strong fundamentals, which makes making short- and medium-term Verge price predictions difficult.
Another worrying sign that is indicated by the Verge trading data is that, after its rapid growth and fluctuations throughout December and January which saw a very high trading volume, almost no one was buying or selling Verge until mid-February. This is strongly indicative of the speculatory nature of its earlier rapid growth, which means that it is likely to continue its downward trends as it moves towards a more stable equilibrium for some months yet.
The low baseline trading volume and a high degree of volatility all point to a poor prognosis for Verge going forward. With low demand to absorb market shocks and a lack of market consensus on its value, it will probably continue to fluctuate wildly in the future with an overall downward trend.
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A fundamental economic principle is that the value of money comes from the goods and services that you can exchange for it. By that measure, the Verge coin is fairly limited in its value. Its website lists around 35 vendors who accept Verge, but none of them are particularly big names, making spending your Verge coins difficult.
This is a fundamental problem given the premise of the Verge cryptocurrency. While you can transact anonymously using Verge, in order to use it you still need to convert it into a different cryptocurrency, which exposes you to the vulnerabilities that Verge was designed to solve.
Similarly, converting between Verge and other currencies is also difficult, as it has fairly limited liquidity currently. There are not currently a lot of exchanges that are listing Verge, which makes it both difficult to buy it if you want to have some and difficult to convert out when you want to spend it.
The limited ability to buy goods and services using Verge, compared to other cryptocurrencies like Bitcoin or Ethereum, leads us to be quite conservative in our Verge price predictions. Because the volume of coins used for transactions is likely much lower for Verge than the volume of coins held as investments, its intrinsic value is fairly low compared to its market value. That makes it likely that, barring adoption by more larger retailers and service providers, the price of Verge coins is going to decrease in the medium and long term.
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The cryptocurrency market is no stranger to controversy or technical problems, but Verge has had the misfortune of suffering from both during its time in the spotlight during December and January.
One of the major events in its rapid rise in December was an endorsement by the eccentric engineer and privacy advocate John McAfee. However, soon after, as Verge prices were climbing, McAfee denied making the endorsement, claiming that his social media accounts were hacked. This, in turn, led to accusations of blackmail from the Verge team, who claimed that McAfee wanted a payoff for promoting the cryptocurrency.
The rollout of the innovative Wraith platform was also plagued with problems, with many users reporting that the anonymity features did not work on the Mac version of the client, while the Windows and Linux versions missed the release deadline completely.
The two episodes both raise issues of just how accountable the Verge team is, and whether they are able to actually deliver on the technology they have promised. This uncertainty is reflected in our Verge price predictions, suggesting that it is unlikely to see growth without significant organizational changes.
Verge, like its competitors such as Monero, DASH, ZCash and others, offers unique technological solutions to difficult problems that many cryptocurrencies face. However, the implementation of these technologies has so far lagged behind the competitors, who have secured larger market shares and better navigated the difficult PR environment of the cryptocurrency world. As such, our Verge price predictions for 2018 are negative. It is likely to continue to slowly decline in value unless new major developments bring it on par with its competitors. What has your experience with Verge been like? Let us know!
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