Over the last several months, the cryptocurrency industry has advanced at an unprecedented rate, gaining mass acceptance among the financial experts.
For instance, Jamie Dimon regrets calling Bitcoin a fraud currency as the crypto economy approached a $1 trillion in terms of market capitalization.
However, in the last few days, the aftermarket has dropped by almost 60%, many newcomers are wondering if Bitcoin is on its last stand and a bubble burst is imminent. This couldn’t be further from the truth as Bitcoin is an extremely volatile currency and from a historical standpoint, moves like these are expected in the market.
Want a free piece of advice?
Remeber this- that you should be holding onto your Bitcoins for the long term unless you are an experienced trader. The short-term price action should not have a sway affect your judgement.
Before making any investment decisions, I think of this quote, “Let the market move, don’t let it move you”. As you can see from the image below, Bitcoin’s price is starting to reach previous price levels before the parabolic rise, this is where some traders will choose to buy Bitcoin.
There are many developments in the works for Bitcoin which will affect the whole cryptocurrency industry growing at an exponential speed with new players joining the scene.
- Lightning Network will allow Bitcoin to scale from 3 transactions per second to millions of transactions per second and allow for exceptionally low fees. This would remove the biggest roadblocks which prevent the mass adoption to Bitcoin as the transaction fee in fiat went up with the price of bitcoin.
Many people wonder, what will happen to a lot of the other cryptocurrencies which brag about fast and low transaction fee, my guess is that a lot of money will flow back into Bitcoin.
- Counterparty aims to bring Ethereum’s functionality of smart contracts to the most secure blockchain in the world, Bitcoin. This will allow developers to build applications on top of the Bitcoin blockchain, currently, the most popular Counterparty dApp is the Decentralized Exchange (DEX), which allows people to exchange Counterparty tokens.
- The second biggest corporation in the world, Samsung, has announced that they will be manufacturing Bitcoin mining ASIC chips which help secure the Bitcoin network.
- The zero-fee trading platform, Robin Hood, has announced that they will support trading of up to 15 different cryptocurrencies, they now have over 1 million people in the registration queue. Twitter’s Cashapp has also announced that they will support cryptocurrencies.
- Over the last few months several counties started banning Initial Coin Offerings and regulating exchanges, China went as far as threatening to ban cryptocurrency exchanges. This may seem to suggest that crypto-currency will never have a place in the traditional financial systems, however like the rest of crypto, there is more than meets the eye. Switzerland, one of the strongest financial hubs in Europe and is welcoming cryptocurrencies with wide arms open after the Swiss economics minister, Johann Schneider-Ammann told journalists that he wants Switzerland to be “the crypto-nation”.
- Some countries believe that cryptocurrencies pose an existential threat to their economies, and they are not necessarily wrong to think this as cryptocurrencies will syphon money from the current financial system as people sell their fiat for Bitcoins. Restrictive regimes will be affected the most, which is why China does not like Bitcoin, there is a $100,000 limit on moving money from China, with Bitcoin It was possible to move almost unlimited amounts as it used to not be regulated.
We are starting to see a transition in Bitcoin’s stigma of being a currency used by fraudsters and drug dealers, due to its shaky past of being a currency which was involved in black markets such as the Silk Road.
Fortunately, criminals have partly abandoned Bitcoin for more private and anonymous coins such as Monero due to new blockchain analysis software. Bitfury, a large Bitcoin mining company has released a new blockchain analysis software called Crystal, which will allow users to pinpoint and examine any suspicious criminal activity that has taken place on the Bitcoin blockchain and avoid interacting with coins that are associated with any illegal transactions.
To conclude, from every ounce of uncertainty, there is a huge enthusiasm for the future of the cryptocurrency industry, with many new projects on the horizon, we are far from complacency.
Feature image by Baiheng