Bitcoin: all you need to promote?

If you had spent $ 27 on bitcoin when it was created by Satoshi Nakamoto in 2009, your investment would now be worth more than $ 37,000,000.
altcoins price live
Widely considered the largest investment vehicle of all time, in 2017 bitcoin meteorically rose, from $ 777 to $ 17,000.

By creating millionaires from opportunistic investors and leaving financial institutions open, Bitcoin has responded to its critics at every stage of this year, and some believe this is just the beginning.

The launch of bitcoin futures on December 10, which for the first time will allow investors to enter the bitcoin market through a major regulated exchange in the US, means we are just getting started.

What makes bitcoin so valuable is that there is a finite amount. There will be a maximum of 21 million bitcoins, and unlike regular fiat currencies you can’t just print them more if you want. This is because bitcoin works on a proof-of-work protocol: to create it you need to extract it using computer processing to solve complex algorithms on a bitcoin blockchain. Once this is achieved, you will be rewarded with bitcoins as payment for the “work” you have done. Unfortunately, the reward you receive for mining decreases dramatically almost every year since the creation of bitcoin, which means that for most people the only viable way to get bitcoin is to buy it on the exchange. Is it worth the risk at current price levels?

Many people think that bitcoin is just a bubble. I spoke to cryptocurrency specialist and long-term investor Duke Randall, who believes the asset is overvalued, “I would compare this to many supply and demand bubbles, such as the Dutch“ Tulip ”and the“ dot bubble ”of the late 90s. consider the functionality of bitcoin as a real currency, it’s almost confusing. ” For those who don’t know, the “dot com” bubble was the period between 1997-2001, when many Internet companies were founded that received outrageously optimistic estimates based solely on assumptions that later collapsed to 80-90% when the bubble began to collapse in the early 2000s. Some companies, such as eBay and Amazon, have recovered and are now well above those estimates, but for others it was the end.

Bitcoin was originally created in order to take power away from our financial systems and put people under its control by excluding the average person and allowing peer-to-peer transactions. However, it is now one of the slowest cryptocurrencies on the market, its transaction rate is four times lower than the fifth largest cryptocurrency and its closest competitor to Litecoin payment solutions. The Monero coin, which cannot be traced, makes transactions even faster: the average block time is just two minutes, a fifth of the time bitcoins can do it, and it’s without anonymity. The world’s second-largest cryptocurrency, Ethereum, already has a larger volume of transactions than bitcoin, despite the fact that it is valued at $ 676 per broadcast compared to $ 16,726 per bitcoin.

So why is the value of bitcoin so high? I asked the same question to Duke Randall. “Everything dates back to the same supply and demand economy, relatively unavailable a lot of bitcoins, and its recent rise in prices has attracted a lot of media attention, this combined with the launch of bitcoin futures, which many consider the first sign Bitcoin is accepted by the mass market. like any asset, when the demand to buy is higher than to sell, the price increases.This is bad because new investors enter the market without understanding the blockchain and the basic principles of these currencies which means they can get burned. ”
bitcoin price
Another reason is that bitcoin is extremely volatile, of course it swings up or down by thousands of dollars in less than a minute, which, if you’re not used to it and doesn’t expect it, causes panic among less experienced investors, leading to a loss. This is another reason why bitcoin will struggle to be accepted as a form of payment. The value of bitcoin can fluctuate significantly between times when vendors accept bitcoin from customers and sell it on exchanges for their local currency. This volatile movement can destroy all their profitability. Will this instability soon disappear? Unbelievable: Bitcoin is a relatively new asset class, and although awareness is rising, only a very small percentage of the world’s population owns Bitcoin. Until it becomes more prevalent and its liquidity improves significantly, volatility will continue.

So if bitcoin is virtually useless as a real currency, what are its applications? Many believe that bitcoin has moved from a viable form of payment to a jewelry store. Bitcoin is similar to “digital gold” and will simply be used as a benchmark for other cryptocurrencies and blockchain projects that need to be measured and traded. Recently, many high-inflation countries, such as Zimbabwe, have been buying bitcoin to hold on to how much wealth they have, rather than seeing its value fall under the attention of the central banking system.

Is it too late to participate in bitcoins? If you believe what these cryptocurrencies will do for the world, it’s never too late to get involved, but because the value of bitcoin is so high, it’s a boat for some who have already sailed. Perhaps you better look at Litecoin, which increased 6908% year-over-year, or Ethereum, which increased an incredible 7521% year-over-year. These new, faster currencies hope to achieve what bitcoin first planned to do back in 2009, and replace government fiat currencies.

Who knows what the price of these currencies will be in ten, fifteen and even twenty years? One thing is for sure, we better tie ourselves in, as it will be a wild trip.