Is the Bitcoin price a bubble waiting to burst? Some seem to think so, and the drastic rise in the cryptocurrency’s price, which wasn’t expected to go up at this rate makes it quite plausible. But by the time the bubble bursts, or if bursts, there will be many who would have turned richer by at least millions, if not billions. An author made the prediction on one of the leading business publication.
Panos Mourdoukoutas goes on to state Bitcoin’s unique advantage over conventional currencies which makes it stronger and more resilient than fiat.
For starters, the current economic situation in many countries and their respective central bank’s policies have led to lowered and in some cases even negative interest rates. In such a scenario, investing the fiat in Bitcoin has started to look like a more attractive option, where the long-term gains definitely outweigh the volatility risks. Such conditions have got many people investing in the cryptocurrency, who eventually will find themselves richer as the cryptocurrency’ value rises.
At the same time, the monetary and market situation across the globe aren’t helping fiat’s cause either. Sudden changes in the monetary system, like in the case of Venezuela and even India have reduced confidence in government-backed currencies. Also, the geopolitical situation in many regions isn’t helping either. It might take a long time for all these issues to get resolved, and as long as it continues people will keep trying to find alternative investments, which will most likely be Bitcoin.
In the sight of demand, the cryptocurrency’s value will continue to grow. Those who have invested in it will continue to register gains until the fine day a much better alternative emerges or the world turns perfect. Hopefully by then, many would have emerged millionaires.
The only thing currently standing between millions of dollars’ worth of gains and the bursting Bitcoin bubble is the scalability issue and increasing transaction confirmation times on the Bitcoin network. If the Bitcoin community comes into consensus early on and solves these scalability issues, the future will continue to be bright for the cryptocurrency. Else, Ethereum or some other altcoin will eventually end up taking its place, confirming the community’s worst fears.
Ref: Forbes | Image: NewsBTC