Can you believe that back in 2009, Bitcoin was worth 1/10 of a penny? Your friends would have either respected or laughed at you if you were to say that you have bought 1 BITCOIN. Mom and Dad would have considered disowning you or have overwhelmed you with constant shame, and even the mainstream media would have publicly embarrassed you in front the world! But here’s the reality: the same people are still denouncing Bitcoin, and it’s time for YOU to rise amongst the noise, and ultimately have the last laugh.
It’s hard to believe what and how we place value in. What started with trading pretty shells and sand dollars became silver and gold followed by paper currency and is now digital bytes. In some respects, it’s crazy to witness that 1 Bitcoin is nearly double the amount of an ounce of gold! This surge of interest has certainly piqued our attention, and while plenty is finding Bitcoin to be in the bull market, we are noticing a tremendous amount of media manipulation, government takeovers, and otherwise damaging news that has impacted the price of Cryptocurrency.
Here are some of the biggest news highlights that heavily impacted Bitcoin:
- China’s continuous threat on “banning cryptocurrencies”
- CEO of JP Morgan Chase slandering the legitimacy of Bitcoin
- Mainstream media’s endless spin of falsified fears that Bitcoin is a huge Ponzi scheme
So we are breaking down our current knowledge of Bitcoin. This is mainly for the beginners who are interested, but are overwhelmed with the amount of bad attention Bitcoin has been receiving. We recommend everyone to be wise with their decisions and not put all of your money in one investment.
Here’s our current overview of Bitcoin:
Approximate Market Supply*: $16.4 million
Current Market Cap*: $67 Billion (Rank:1)
Why Bitcoin may succeed
This is the currency that started the crypto revolution and for all intents and purposes, it has already succeeded. While I have discussed many of the merits of why the currency has value, there is still great potential for it to continue to rise. First off, its value is relative. If 1 BTC is worth $10,000 or 100,000 USD, it doesn’t really make anything less affordable. While we may be long ways away from using Bitcoin in similar ways that we use Apple/Android wallet apps on your phone for everyday purchases (and some argue we never will), Bitcoin has proven itself valuable as a “reserve currency” for crypto trading. Many online crypto exchanges don’t trade in traditional currencies and rely on using Bitcoin to purchase other cryptos. Others treat Bitcoin as “digital gold”, using it as an efficient digital store of value that users can easily access globally. For more information, check out Andreas Antonopoulos’s book, “The Internet of Money”, or at least watch his Bitcoin 101 video on YouTube.
Why it may not
Bitcoin is going through a difficult time scaling as the currency becomes more popular, and as the blockchain that supports it gets more traffic. This is causing big rifts in the community, as with no centrality, it is difficult to get consensus on how to make the improvements that are needed. While it appears that recent modification to the blockchain’s software is effective, it will be interesting to see how the network scales as the currency becomes more popular. Also, while the currency is supposed to be decentralized, its mining has become very centralized, as the 5 biggest mining pools account for 57% of all mining and transaction processing. Because many of these pools have ties to large-scale and capital-intensive server farms, small home mines do not generate enough currency to pay for their own electricity to run the mine. Another challenge with its large-scale implantation is its volatility, which creates a problem of high “menu costs”. This is the cost of businesses changing their prices to reflect the change in the value of the currency. It is these challenges that have made altcoins popular in the past year.