A cryptocurrencies could lead to a “mass market wipe out,” technology investment bank GP Bullhound predicted in a report.
Cryptocurrencies will experience a “heavy correction” of 90 percent leading to a “mass market wipe out,” a technology investment bank predicted in a report seen by CNBC on Wednesday.
GP Bullhound’s “Token Frenzy: The Fuel of the Blockchain” report laid out the current state of cryptocurrencies, blockchain technology, initial coin offerings (ICO) and what they think the future will look like.
One prediction is that cryptocurrencies will experience a 90 percent correction within the next 12 months with “very few companies” surviving.
Sebastian Markowsky, a director at GP Bullhound, and main author of the report, explained that institutional investors are likely to come into the market and drive the price higher. More retail investors will get in to the market too, buying cryptocurrencies at elevated prices. As the market begins to see sharp falls later this year, it will exacerbate the selling causing “panic” and the eventual correction.