Bitcoin: All It’s Hyped Up to Be?
Had you spent $27 on Bitcoin when it was created by Satoshi Nakamoto in 2009 your investment would now be worth over $37,000,000.
Widely regarded as the greatest investment vehicle of all time, Bitcoin has seen a meteoric rise during 2017 going from $777 all the way to $17,000.
Creating millionaires out of opportunistic investors and leaving financial institutions open-mouthed, Bitcoin has answered its critics at every milestone this year and some believe this is just the beginning.
The launch of Bitcoin futures on December 10th, which for the first time will allow investors to enter the Bitcoin market through a major regulated US exchange, implies that we are just getting started.
What makes Bitcoin so valuable is that there is a finite amount in existence. There will only ever be a maximum of 21 million Bitcoins and unlike normal fiat currencies you can’t just print more of them whenever you feel like. This is because Bitcoin runs on a proof of work protocol: in order to create it, you have to mine it using computer processing power to solve complex algorithms on the Bitcoin blockchain. Once this is achieved, you are rewarded with Bitcoin as payment for the “work” you have done. Unfortunately the reward you get for mining has decreased drastically almost every year since Bitcoin’s inception, which means that for most people the only viable way to get Bitcoin is buying it on an exchange. At the current price levels is that a risk worth taking? More information visit:-https://newsforbitcoincrypto.com/
Many believe Bitcoin is simply a bubble. I spoke to cryptocurrency expert and long term investor Duke Randal who thinks the asset is overvalued, “I would compare this to many supply and demand bubbles over history such as Dutch Tulip Mania and the dot com bubble of the late 90s. Prices are purely speculation based, and when you look at Bitcoin’s functionality as an actual currency it is almost embarrassing.” For those who don’t know, the dot com bubble was a period between 1997-2001 where many internet companies were founded and given outrageously optimistic valuations based purely on speculation that later plummeted 80-90% as the bubble began to collapse in the early 2000s. Some companies such as eBay and Amazon, recovered and now sit far above those valuations but for others it was the end of the line.
Bitcoin was originally created in order to take power away from our financial systems and put people in control of their own money, cutting out the middle man and enabling peer to peer transactions. However, it is now one of the slowest cryptocurrencies on the market, its transaction speed is four times slower than the fifth biggest cryptocurrency and its nearest competitor for payment solutions Litecoin. Untraceable privacy coin Monero makes transactions even quicker, boasting an average block time of just two minutes, a fifth of the time Bitcoin can do it in, and that’s without anonymity. The world’s second biggest cryptocurrency, Ethereum, already has a higher transaction volume than Bitcoin despite being valued at only $676 dollars per Ether compared to Bitcoin’s $16,726 per Bitcoin.