Why I believe in ‘bright’ future for cryptos?
Ok guys… this post is a controversial one where you may or may not agree with some or all of my points. Hopefully I am not making big claims given my modest knowledge over the subject….yet, here we go…
First to express the tone of my beliefs, I’ll start with views of few billionaires on Bitcoin:
Tim Draper mostly known for making over $1 billion, being an early bird on Twitter, Skype, Tesla also maid $110 million with Bitcoin investment. Talking to Forbes, he said:
“In five years, if you try to use fiat currency, they will laugh at you. Bitcoin and other cryptocurrencies will be so relevant… there will be no reason to have the fiat currencies.”
Mike Novogratz, former Fortress hedge fund manager, predicted that Bitcoin will hit $10,000 by end of 2017 and an in fact we all witnessed his predictions coming true, rather surpassing). Practising what he preaches, he’s even put his $150 million in a $500 million crypto-fund.
And of course John McAfee — creator of the antivirus software predicts that Bitcoin will hit $500,000 within three years.
Next on to taking a birds eye view on Bitcoin and cryptocurrencies..
At present, Bitcoin is used as a digital asset more than a currency. It is also a synonym for cryptocurrency, not only in terms of everyday use in our conversations, but even the crypto/alt coin markets are driven by Bitcoin’s price appreciation/depreciation. Personally speaking, I believe that we are witnessing a revolution similar to invention of electricity and steam engine. Cryptocurrency gives power to people, and historically speaking, anything that facilitates masses, eventually gets adopted. What makes me so confident in saying so…data from various markets conclude:
- At first, assets are undervalued
- Next, they become ‘fairly’ valued
- Farther next, they are overvalued
- Last, they crash that also marks their journey towards long-term moving average
Not to forget that next year, we will be celebrating a decade since Bitcoin was born.
And my optimism comes from..
Just imagine the financial and economic crash of 2008, happening, today. Would the effect prevail for longer than few months? Not in my opinion because masses wouldn’t care how much a dollar values, as they have an option of switching to currencies that aren’t controlled (aka regulated) by governments that are run by puppets merely serving their individual and not national interests. In fact, cryptocurrencies are regulated…. by algorithm.
It had been repeatedly said.. a dollar holds value because people believe so..but how this belief is formed and implanted in our minds is itself a topic worth discussing. Cryptocurrencies or Bitcoin also has a value because people believe so, however the difference between both is that the cryptocurrencies give power to people.
Now on to..why I believe a bright ‘future’ for Bitcoin..
A wider world population living in developed countries doesn’t have access to, instantaneous peer-to-peer payment system. Now imagine that this population is able to trade in cryptocurrencies from groceries to all essentials..would they still need traditional banking system ? I don’t think so..
A lot of skepticism for cryptocurrencies come from the market volatility, which in my opinion is fairly reasonable. Nevertheless, I see volatility minimising with time…why….once people start experiencing the true power and benefits of cryptocurrencies, the media would be compelled to change its opinion in favour of masses. More importantly, a widely overlooked aspect of cryptocurrencies is the technology operating behind it- blockchain. Once people ‘not-from-technological background’ would apprehend to the true potential of this technology, their perceptions would match that of our ancestors when steam engine was invented.
Next, a wider acceptance of Bitcoin as mode of payment by larger companies will also encourage the companies waiting under shadows to emerge. In my humble yet firm opinion, it’s not ‘if’, but ‘when’.. I believe that time is just round the corner.
Fourth, people realising true potential of Bitcoin and cryptocurrencies in general, love to hear its price escalating and reaching new heights. Although no one can predict the price precisely, I guess it should hover around 10,000 USD before X’mas ’18. Comparing to 2017, 10,000 USD may not seem exciting but promising, surely. Promising, because high amount of speculative money (e.g. 50,000 and beyond) entering in to an ecosystem will attract not-so-desired attention of regulators resulting in hard clamp-down of Bitcoin. Needless to say, we don’t need that..not at least now.
As always, comments and constructive criticism is appreciated.