Bitcoin in 2018: forecasts and results
Last year, cryptocurrencies went through a spectacular downturn, declining in value by as much as 95%. The euphoria of 2017 and early 2018 left a nasty hangover.
The most bullish experts were proven wrong. Sceptics triumphed.
At the beginning of 2018, we asked analysts on our Collective Intelligence Platform to forecast the maximum price of Bitcoin for the year. The special prize for the most accurate prediction was 1 BTC. Let’s review how collective intelligence and our superforecasters answered.
Collective intelligence results
First, we would like to sincerely thank everybody who participated. Recording your forecasts is a brave and brutally honest exercise. We all tend to remember our successful calls and forget the failures. Yet the most effective way to improve our analytical skills is by writing down our forecasts and carefully reviewing the mistakes. Thank you so much for being with us on this journey!
Now let’s turn to the results.
After the meteoric rise of Bitcoin’s price in Q4 2017, the crypto crowd remained bullish. As we revealed in January last year, the simple average of all the predictions we received was $55,691.
Other models would have predicted values in the range of $41,398–41,443.
If you got it wrong, do not despair. Some well-known experts were even further off.
Arthur Hayes, Bitmex CEO: “Bitcoin to hit $50,000 by year end”.
Spencer Bogart, Blockchain Capital Partner: “Bitcoin could easily trade over $50,000 in 2018”.
Michael Novogratz, CEO of Galaxy Digital Holdings Ltd. and hedge fund legend: “Bitcoin could ‘easily’ reach $40,000 by the end of 2018”.
It is remarkable that a small minority of analysts on our Collective Intelligence Platform went against the prevailing mood and were separated from the correct maximum price by tens of dollars.
On 6 January 2018, BTC/USD reached $17,252 and declined from then on. The most accurate forecast was $17,256.* This forecast came from a user who answered just 67 crypto questions. We’ll be in touch shortly and hope the 1 BTC prize will be a good incentive to keep forecasting.
Other superforecasters also saw that the market had peaked. The mean answer from the top 30 users for this question was $17,292.
Among the analysts who answered this question, the top 2% of answers forecast that the maximum price would fall within the range of $16,499 to $18,001. These analysts probably already know that they’re good at market forecasting. Still, we’d like to thank you once again! You’re doing a great job, keep going.
The top 100 users from the November rating, however, were less accurate. The median answer from the users who previously reached the top 100 was $41,443. It is likely that the top rankings in November went to the bulls, who got it right and stuck with their views.
How Bitcoin forecasts changed
Over the last year, we asked additional questions about the maximum and minimum prices of Bitcoin by the end of 2018.
The bars on the above chart show median answers for additional questions mapped against the actual price (the blue line).
As you can see, both the top users and the crowd remained bullish, even when the market was crashing. This is consistent with our research into crypto crowd behaviour which suggested that it takes several months to adjust to new trends.
In the second half of the year, we also asked questions about the minimum price BTC would reach by the year end. On the chart, the bars below the historic BTC price show the minimum price as forecast by the crowd and top users. It appears that both the crowd and the top users thought that the market was near the bottom.
Below you can find the data if you want to do your own additional research. By clicking on the link to each question you can also check your own forecast. If anything is unclear, please leave a comment and we’ll be in touch.
|Question||Question ended (UTC)||Target date||Direction||Median answer from top user predictions||Median answer from crowd predictions|
Bitcoin price in 2019 and beyond
As you can see, it is hard to predict the price of cryptocurrency in the medium term. That’s because both fundamental and behavioural factors come into play and it’s not clear which ones will prevail during the period.
Over the short term, the market is more predictable as Hybrid Intelligence indicators have demonstrated. Every week we ask questions about the maximum and minimum price of Bitcoin and other major assets. These indicators are available to our token holders at the Explorer tier and above. Other questions cover emerging events in the market – there is always something happening in crypto and volatility regularly provides new opportunities.
At Cindicator we believe in the long-term success of crypto assets. Blockchain – and the decentralised ledger more broadly – is a disruptive technology that has enabled a stateless digital store of value and laid the foundations for truly open finance.
It is far from clear, however, which assets will emerge as the dominant ones. That’s why we think the best approach for the long-term investor is to keep a regularly rebalanced basket of crypto assets as part of a larger diversified investment portfolio.
*In the original version of this post, a mistake was made in announcing the winner. We'll still be in touch to offer a consolation prize.
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