The Future of Bitcoin as a Cryptocurrency

Physical Bitcoin Source: Pexels Bitcoin is a digital asset designed to function as a medium of exchange. It uses cryptography to safeguard its creation and management, rather than relying on traditional centralised authority. Over the course of its history, Bitcoin has seen rapid growth and is now a significant currency both online and in the financial world. And from the mid-2010s onwards, a few businesses agreed to accept bitcoin as well as traditional currencies. The appearance of bitcoin soon prompted the emergence of rival cryptocurrencies in 2011. Then after a period of rapid growth, during which the bitcoin price hit the $1,000 mark, the price crashed back to $300 in 2013. By 2014, bitcoin had begun to experience scams and thefts, and later – in 2016 – the cryptocurrency market once more became enthusiastic about Ethereum, another new currency. About this time ICO (Initial Coin Offerings) trading platforms became popular. But almost at once they were criticised as being extremely vulnerable to scams – with China going further and instigating an outright ban. Bitcoin’s popularity continued to grow unchecked through 2017 with values reaching $10,000 and more. But by the close of the year, with prices approaching $18,000, bitcoin began to lose value quickly. In February 2018, bitcoin stood at $6,200, and though it remained around this level for much of the rest of the year, having by then lost around 80% of its value, bitcoin’s reputation for volatility meant that many trading in financial markets became wary of accepting bitcoin transactions. In further moves affecting the currency’s credibility, Google and Facebook banned crypto-currency advertising campaigns, citing poor consumer protection as the reason for their actions.

What is the future of bitcoin?

One expert answered this question by offering three possible scenarios: 1) A Bitcoin triumph – a scenario in which bitcoin replaces traditional fiat currencies and thus becomes the main unit of exchange. As a result, ‘people buy pizzas, finance their mortgages and pay their rent in bitcoin’. 2) Bitcoin achieves gold status – in this situation, fiat currency stays as the default unit of exchange in every jurisdiction – with the possible exception of a handful of extremely volatile and dysfunctional economies. Market capitalisation continues and bitcoin gains value over time, despite being subject to a few bubbles and slides along the way. 3) Bitcoin crashes – in this event bitcoin’s value against the dollar plummets and the currency loses its status as a viable method of payment.

Which cryptocurrency will turn out to be the best?

When considering bitcoin as an investment, the answer clearly depends on the stance of the commentator. Some, like Berkshire Hathaway's Chairman and CEO Warren Buffett – presently rated the third-richest man on earth – may consider that (with bitcoin investments): “You aren’t investing when you do that. You’re speculating. There’s nothing wrong with it. If you wanna gamble somebody else will come along and pay more money tomorrow, that’s one kind of game. That is not investing.” Elsewhere, Fundstrat executives Tom Lee and Sam Doctor are reported to believe that a bitcoin return to $36,000 during 2019 is “realistic”. But thinking about cryptocurrency as a utility for the multi-asset age, Paul Puey of Edge Wallet believes that the viability of cryptocurrencies for both users and merchants actually lies in the ability to be able to ‘set up a wallet — while retaining control of the private keys — and accepting major cryptos including Monero and Ethereum in a matter of minutes.’

Will the Bitcoin price go much lower? And will it ever recover?

Many financial institutions are somewhat reluctant to take a position on the market performance of cryptocurrencies. However, though reluctant to make an actual prediction, David Thomas, director and co-founder of the GlobalBlock digital asset brokerage harked back to bitcoin’s historical price behaviour during earlier market crashes of a similar nature, saying: “If we look at previous trends it takes on average around 67 weeks for bitcoin to recover and proceed to new all-time highs… If you follow this logic, then bitcoin would be heading towards US $20,000 in the second quarter of 2019.” However, Thomas adds a caveat that with a “bruised investor base after this year” he is not sure that the same thing will happen this time around. In the light of this, he therefore modified his likely expectation to say: “With positive news, ETFs and regulation, we believe bitcoin will recover to the US $8000 to $10000 levels during 2019 which given where it is today would on balance be a decent year.”

Is it safe to invest in Bitcoin?

Given Warren Buffet’s reported comments, which explain why he thinks buying bitcoin is more like playing in your favourite online casino than purchasing an investment, it would be sensible to think carefully before treating a highly speculative bitcoin purchase exactly like any other mainstream financial investment.
Categories: Technology
Mystery Boxes Are Popular ... Biggest Female Earners In ...