The future of cryptocurrencies in 2019 and beyond

A cryptocurrency is a digital currency created and managed using advanced encryption techniques called cryptography. The cryptocurrency went from an academic concept to a (virtual) reality with the development of Bitcoin in 2009.1 While Bitcoin has attracted a growing number of followers in the years since it has attracted the attention of investors and the media in April foreign exchange markets today. since 2013 when a record was reached. starting at $ 266 per bitcoin, having multiplied by ten in the last two months. Bitcoin had a market value of over $ 2 billion at its peak, but a 50% drop shortly thereafter sparked a heated debate about the future of cryptocurrencies in general, and Bitcoin in particular. Will these altcoins eventually become traditional currencies? A day as ubiquitous as the dollar and the euro? Or are cryptocurrencies a fad on the brink of extinction? The answer is in Bitcoin.



The future of cryptocurrencies

Some economic analysts predict that a big change in cryptocurrency is imminent when the institutional currency hits the market.3 Furthermore, cryptocurrencies could be introduced on the Nasdaq, increasing the credibility of the blockchain and its use as an alternative about the foreign exchange market. Compared to classics, these would further increase the coins.4 Some predict that cryptocurrencies only need a verified exchange-traded fund (ETF) .5 An ETF would certainly make it easier to invest in bitcoins, but there should always be a demand for cryptocurrencies. also. investing that should not be generated automatically with a fund.

Understanding Bitcoin

Bitcoin is a decentralized currency that uses peer-to-peer technology that allows all functions, such as coin issuance, transaction processing, and verification, to be performed collectively by the network.6 Although this decentralization makes Bitcoin free From manipulation or government interference, the downside is that there is no central authority that makes things run smoothly or covers the value of a bitcoin best broker in India for forex. Bitcoin is created digitally through a "mining" process that requires powerful computers to solve complex algorithms and process numbers. They are currently created at the rate of 25 bitcoins every 10 minutes and are capped at 21 million, a level expected to be reached by 2140.

Future prospects for Bitcoin

The future prospects of Bitcoin have been the subject of much debate. While financial media is promoted by so-called crypto evangelists, Harvard University professor of economics and public order Kenneth Rogoff suggests that the "prevailing sentiment" among crypto advocates is "the entire market capitalization of cryptocurrencies. for the next five years. " "Returns". It amounts to 5 to 10 billion. "8 The volatility of the historical asset class" does not cause` for panic, "he said. However, he cooled his optimism and that of the" crypto evangelist "of Bitcoin as digital gold, called it" crazy "and named its long value. term. The term "will be closer to $ 100 than $ 100,000." With physical gold, Bitcoin is limited to transactions, making it more prone to collapsing a bubble. a lot of energy, because cryptocurrency is "much less efficient "than systems that depend on" a reliable central authority such as a central bank. 


Increase control

The main benefits of decentralization and the anonymity of Bitcoin transactions have also made it a currency of choice for a wide variety of illegal activities, including money laundering, drug trafficking, smuggling, and arms purchases. This has drawn the attention of powerful regulators and other government agencies such as the Financial Crimes Enforcement Network (FinCEN), the SEC, and even the FBI and the Department of Homeland Security (DHS). In March 2013, FinCEN enacted rules defining exchanges and virtual exchange managers as money service companies, placing them under state regulation.9 In May of the same year, DHS froze an account at Mt. Gox, the largest exchange in the United States. Bitcoin, which Wells Fargo claimed to have violated money laundering laws.10 11 And in August, the New York Department of the Treasury issued subpoenas to 22 emerging payment companies, many of which dealt with numerous Bitcoin, inquiring about your fight against money laundering and money laundering. measures Ensure consumer protection.

Should you invest in cryptocurrencies?

If you are considering investing in cryptocurrencies, it may be better to treat your "investment" like any other highly speculative business. In other words, you should be aware that you risk losing most, if not all, of your investment. As already mentioned, a cryptocurrency has no intrinsic value, other than what a buyer is willing to pay for it at any given time. This makes it very sensitive to large price fluctuations, which in turn increases the risk of loss for an investor. Bitcoin, for example, went from $ 260 to around $ 130 in six hours on April 11, 2013.18 If you can't handle this kind of volatility, look elsewhere for investments that work best for you. While opinions remain deeply divided on the merits of Bitcoin as an investment, with supporters pointing to its limited supply and growing use as an engine of value, while critics see it as another speculative bubble, it is a good debate that a conservative investor I would avoid doing it.

Conclusion

The arrival of Bitcoin has sparked a debate about its future and that of other cryptocurrencies. Despite Bitcoin's recent troubles, its success since its inception in 2009 has inspired the creation of alternative cryptocurrencies such as Etherium, Litecoin, and Ripple. A cryptocurrency that wants to be part of the traditional financial system would have to meet very different criteria. While this possibility seems unlikely, there is no doubt that Bitcoin's success or failure in meeting the challenges it faces could determine the fate of other cryptocurrencies for years to come.

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