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Blog Post

Dec 12

The Future Of Bitcoin


Litecoin shot up over the last few days giving rise to the uninformed masses (many of whom were journalists) once again berating Bitcoin as something that will inevitably fail. Between articles citing that "pump and dump" is the future of bitcoin, and that it is valueless because it is based on "nothing." Fiat money has been in circulation since 1000 AD and has no intrinsic value. It's first recorded use was in ancient China, and every single US dollar is a form of fiat money since we abandoned the gold standard in 1971. Credit cards, are literally a system of debt at interest against valueless fiat currency, and at a fixed rate against even more valueless currency, and that still seems to be going strong.

Why Are Fiat And Credit Currencies Going Strong?   

Because they are being widely used. There are alternatives to these currencies but they start increasingly relying upon those same currencies for value, i.e. stocks, bearer bonds, property ownership, fancy buttons, and other inanimate objects which seem highly prized like diamonds or pokemon cards.

Why Bitcoin Is Steadily Increasing In Value

While it's true that it has peaks and valleys like stock, it's main increase in value has been due to it's regular mining, and use. It's value is currently when coupled with other crypto currencies worth more than JP Morgan,  and Bitcoin alone is worth more than New Zealand. I could produce some fancy infographics to illustrate this but I shouldn't have to. Eventually the people who make foolish statements about things they know nothing about, will need to eat their words due to their lack of finances, when the rest of the world switches over to bitcoin.

Why Bitcoin Rocks

Let's describe the kind of protection against fraud offered by the blockchain briefly and let you decide for yourself. If everyone around you had a copy of every transaction record connected to both themselves, and you, but couldn't use it to identify you, or your purchases, would that be good or bad? If your wallet knew how much money was in it, and couldn't be tricked into having more or less, because other wallets would reflect the change and immediately determine it was fraud, would that be safer or less safe? Blockchain uses a system very much like this, and it is why nobody can technically steal bitcoin unless they actually steal the individuals wallet, access codes, and so on. That isn't as easy as stealing online bank account access. To steal online bank account access only really requires a username, a password, and sometimes nothing else, sometimes a confirmation question or other additional authentication factor. Even that isn't certain, as there are other ways to defraud banks. But trying to manipulate crypto is harder than that. In fact to try to make fraudulent bitcoin would take exponentially longer than to mine actual bitcoin, and to steal it would potentially invalidate it. 

Is It True About "Whales" Owning 40% Of Bitcoin?

There is a hint of truth about the 40% belonging to a small group, but before anyone screams illuminati remember the early adopters were trading at $5 a bitcoin. It is entirely likely that access to the earliest bitcoins is compromised or lost. The hardware from that era, upon which most wallets were kept, may account for as much as 9 of the total 21 actual Bitcoins, and as they don't seem to be in heavy use, they may reach a point on non accountability in the future. Bitcoin's value was, is, and will remain in it's use, and crypto currencies now come in many shapes and sizes, trade faster and more profit heavy than most stocks, and are now much more widely adopted than in those early days where it's future was actually uncertain. The future of Bitcoin is almost certainly similar to credit cards, stocks, and fiat currency as that is in the "ballpark" of its current use. That is a conservative estimate, in reality it may replace some currencies altogether as it allows international trading, which is something that stock markets frown on.   


 
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