Could Bitcoin Be The Currency Of The Future?

Bitcoin’s recent fluctuation has raised questions about what the future of the digital currency will be. So is Bitcoin the currency of the future? Or is it an inflated balloon?

Bitcoin’s recent fluctuation has raised questions about what the future of the digital currency will be. So is Bitcoin the currency of the future? Or is it an inflated balloon?

While Bitcoin broke a new record by reaching the level of $ 58,000 last Sunday, it fell to $ 46,000 on Tuesday morning. This decline, which came after Tesla’s CEO and Bitcoin fan Elon Musk said that “the cryptocurrency may have been overvalued.” This decline, especially in the hands of those who were skeptical of Bitcoin, continued to rise for a while after last Tuesday. Last Wednesday, the cryptocurrency rebounded and traded above $ 50,000.

Bill Gates, the founder of Microsoft, comments on Bitcoin, “My opinion is that if you have less money than Elon you should probably be careful.” So what history can tell us about this cryptocurrency?

Will Bitcoin be the gold of the future?

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Bitcoin and gold are incomparable, says Bernd-Stefan Grewe, a professor of history at the University of Tübingen in Germany and who studies gold.

Grewe states that gold is universally accepted worldwide and can be easily converted into local currency wherever it is located.

According to Grewe, reminding that Bitcoin is not like that, it is very important to be able to convert digital money into a local currency. “If things change and I want to convert Bitcoin quickly, who guarantees that I can exchange it for another currency and convert it to the price I want to sell?” Grewe said. she asks. He adds that it takes days to cash out Bitcoin.

Bitcoins rise reflects Americas downfall 1

These trading points will undoubtedly play an important role in determining Bitcoin’s future success.

Because most of the scams related to Bitcoin are caused by the anonymity of digital money exchanges. It records and secures Bitcoin exchange transactions with blockchain.

However, the anonymity of the accounts that send and receive Bitcoin may be beneficial for criminals. According to the authorities, information can still be collected at these transaction points.

“The original idea behind Bitcoin was that you could not track transactions and have an alternative currency that is independent of central bank influence. This is a bit naive thought,” says Grewe. “For the sake of it. And I believe this is at the point where Bitcoin was converted into traditional money.”

Grewe, who predicts that with the increasing interest and acceptance of Bitcoin, the interest of legal and regulators will also increase, pointing out that criminals can make money exchange through Bitcoin, “State institutions will definitely follow. At least I hope so.” So what awaits Bitcoin in the future? Grewe’s warning on this subject is as follows: “If the convertibility belief is lost, Bitcoin will also collapse. Just like any other currency. There could be tremendous inflation. “


So, would it be appropriate to call Bitcoin’s rise a “bubble?” According to Will Quinn, a financial lecturer at Queen’s University Belfast in Northern Ireland, there is a short answer: No.

“There are many similarities with cryptocurrencies that ‘exploded’ in the past. But basically Bitcoin is new and different,” says Quinn. But Quinn also points to the similarities of Bitcoin to the 1720 Mississippi Balloon incident. The Royal Bank of France bought a company to aid a French colony in Louisiana, then increased the company’s popularity with an effective marketing method, eventually the company’s shares grew to the extent that more paper notes were needed, but the printed paper money proved to be worth the coin in hand. “If you look back, you’ll see that the prices are too high there, too,” Quinn warns.

Another thing Bitcoin reminds Quinn of is the Ponzi scheme, a fraudulent method where investors are paid with money from the next investors.

Quinn says it is designed to pay early adopters of the Bitcoin system generously, with funds generated by later investors. Comparing this to early adopters aggressively hiring new adopters, Quinn says, “That’s what’s happening on the Internet. People are always trying to convince you to buy Bitcoins.”

“This is almost an improved version of a Ponzi scheme,” says Quinn, who points out that there is no central operator where you can withdraw the money. So what does all this tell us?

Looking ahead instead of history, neither Quinn nor Grewe are of the opinion that everyone will be trading Bitcoin in the future.

“Personally, I expected this bubble to burst for three years,” says Grewe. For Quinn, Bitcoin’s transaction limit is, among other things, a huge barrier to its adoption. “This is a governance structure designed to remain unchanged,” adds Grewe, who says there is no way to implement these changes because Bitcoin has no person in charge.

“It looks like a balloon to me,” Quinn concludes.

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