I am 43 years old, not a professional investor, but I would say above average with regards to financial intelligence. I have only recently (within the past month) gotten into cryptocurrencies but I am now obsessed. Please see my other story for more background if you want . But what I have really been wondering these past few weeks (and I know I am not alone) is WHAT IS THE FUTURE OF BITCOIN?? I have put a lot of thought into this- and I feel confident that it is not a fad or “bubble” but rather is here to stay- at least for a while. Ok I guess I should be more specific- I did ask a heroin addict when the last time he used was, and he replied “a while.” When I asked how long that was, he got more specific: “like 6 hours ago.” My definition in this context is more like 10–20 years. After that, who knows- we may all be destroyed by the AI terminators who funded there plasma gun program with bitcoins.
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Initially I was thinking wow this is awesome- you can buy a cup of coffee or something on amazon and only pay a fraction of the cost that would normally go to a credit card. Plus, screw credit cards- they are middlemen whose only purpose is to take more money from both you and the vendor. But then I started doing my research and quickly learned that BTC is not really made for this. The transaction times are too slow, and the block sizes are too small to handle that kind of volume. The much maligned Bitcoin cash was a proposed solution to some of these problems. Hugh? so what IS so great about Bitcoin then?
It is decentralized. This is an amazing concept when you think about it. Nobody can shut it down or tell it what to do. It is autonomous. While this is true in theory and to some extent in reality, the mining pools that control the majority of the bitcoin blockchain are troubling. But I do not think this is necessarily that bad because they all have the same incentive- to make bitcoin as valuable as possible.
It is secure- do the research on 256 bit encryption. It will blow your mind. All the computers in the world cannot spit out all the numbers needed to try to hack it before the sun explodes in a supernova. Also it is spread out over thousands (or more?) of computers all over the globe rather than in a server farm in New Jersey.
It is completely inflation resistant:
It is the Gold of the crypto world. I started looking at coinmarketcap, Binance, coinbase, gemini, Gate, bit- you get the point. You start looking at all these exchanges and you realize a few things: there are a lot of people already doing this crypto thing. And while a lot of these tokens and icos may very well make no sense and be way overvalued and super sketchy, the only way to enter into this world is through Bitcoin. Well ok- you can break the fiat wall with Litecoin and Ethereum too. But Bitcoin is the king. The original. Part of it is just the name- Bitcoin. I don’t see this changing anytime soon. The cryptocurrency market is definitely growing, and it all starts with people buying bitcoin to then start trading on these exchanges. When traders start making profits on trades, the measuring stick is against Bitcoin, not fiat. Most people are not going back and forth through that fiat wall. This means that they are storing their wealth in Bitcoin. IT MAY NOT SERVE ANY OTHER PRACTICAL FINANCIAL PURPOSE OTHER THAN AS A STORE OF WEALTH. In a lot of ways, it makes perfect sense that it is the new gold.
Like I said, I am not a professional investor- far from it. I am a reasonably intelligent person, however, and it does not require much convincing for me to realize that the value of bitcoin will likely go up 10–1000 fold in the next few years. The $20,000 peak from December will merely be a blip on the curve when we look back after a few more years. The supply is finite, and the demand will only be increasing exponentially as people cross over into this digitized form of gold. Our grandchildren will look back and laugh at how absurd the whole concept of using a shiny rock as a store of value was.
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