Bitcoin: Hyped as All Will Be?

If you spent $ 27 on Bitcoin when it was created by Satoshi Nakamoto in 2009, your investment will now be more than $ 37,000,000.

Bitcoin, regarded as the largest investment vehicle of all time, saw an increase in meteor in 2017 from $ 777 to $ 17,000 along the way.

Bitcoin, which has freed its financial institutions by making millionaires from opportunistic investors, has responded to its critics at every stage this year, and some think it is just the beginning.

On December 10, Bitcoin futures allow investors to enter the Bitcoin market for a first time through a highly regulated US exchange, signaling that we have just started.

The reason Bitcoin is so valuable is because it is so up-to-date. There will be up to 21 million Bitcoins, and unlike normal fiat currencies, you can't print more of them at any time. The reason for this is that Bitcoin works on one piece of work protocol: to create it, you need to minimize it by using computer processing power to solve complex algorithms in the Bitcoin blockchain. Once you do this, you will be rewarded for your "business" with Bitcoin. Unfortunately, your mining premium has declined almost every year since the creation of Bitcoin, which means that for many people, the only possible way to acquire Bitcoin is on the stock exchange. Is it worth taking a risk at today's price levels?

Many believe that Bitcoin is just a foam. I spoke with Duke Randal, a cryptocurrency specialist and long-time investor who thinks the asset is overvalued: "I would compare it to many supply and demand bubbles like Lala Mania in the Netherlands and the late 90s. Bitcoin & # 39; You see, it is embarrassing. "For those who don't know, the com com is a period between 1997 and 2001 when many internet companies were established and overly optimistic. Estimates based on the assumption that Bubble began to collapse in the early 2000s, which subsequently dropped 80-90%. Some companies, such as eBay and Amazon, have recovered and are now sitting much longer than these reviews, but for others it's the end.

Bitcoin was originally created to take power from our financial systems and control people with their money, cut the average person and enable peer-to-peer transactions. However, it is now one of the slowest cryptocurrencies on the market, sliding four times faster than Litecoin, the fifth largest cryptocurrency, and its nearest competitor for payment solutions. Immortal privacy coin Monero, with a block average of just two minutes, has about one-fifth of the time Bitcoin can do this, and makes these transactions faster without anonymity. Ethereum, the world's second-largest cryptocurrency, has a higher transaction volume than Bitcoin, although Bitcoin costs only $ 676 per $ 166 compared to Bitcoin.

So why is Bitcoin worth so high? I asked the same question to Duke Randala. "It's all back to the same supply and demand economy, with relatively little Bitcoin, and recent price increases have attracted a lot of media attention, with the launch of Bitcoin futures that many see as the first. Bitcoin is widely accepted by the mass market. As with any asset, prices go up when it is more demanding to sell. New investors are entering blockchain and the market is likely to burn without understanding the basic principles of these currencies. "

Another reason is that Bitcoin is so volatile that in less than a minute it has been found that thousands of dollars are swinging up or down, causing less experienced investors to panic and lose, if you don't get used to it. This is another reason why Bitcoin will struggle to accept it as a form of payment. Bitcoin prices can vary significantly between vendors' time to buy Bitcoin and exchange for local currencies. This erroneous move can erase all their profitability. Will this instability disappear anytime soon? Most likely: Bitcoin is a relatively new asset class, and despite increasing awareness, only a small proportion of the world's population owns Bitcoin. The volatility will continue until it becomes wider and liquidity improves significantly.

So if Bitcoin is really useless as a real currency, what are their applications? Many believe that Bitcoin has become a repository of the value of being a paid form. Bitcoin is like "digital gold" and will only be measured and used as a criterion for other cryptocurrencies and blockchain projects. In recent times, high-inflation countries, such as Zimbabwe, have stories about how much wealth Bitcoin is getting, rather than seeing its centralized banking system fall in value.

Is it too late to participate in Bitcoin? If you believe in what these cryptocurrencies will do for the world, it's never too late to get involved, but because Bitcoin's value is so high, it is now a boon for some of them. You can do better than look at Ethereum, which has reached Litecoin 6908% a year or an incredible 7521% a year. These new, faster currencies are hoping to achieve first to rebuild Bitcoin in 2009 and to replace the government-run fiat money.

Who knows what the value of these currencies will be in ten, fifteen, or twenty years? Although it is clear, we close ourselves better so we can go for a wild ride.