So
what’s next for Bitcoin? As outlined previously, it has many advantages
and for this reason it will remain relevant as a currency. The vast
majority of BTC transactions by volume are made in China so the two will
remain interlinked.
We see the biggest risk to Bitcoin being its substitution and/or
parallel use by other crypto currencies. Bitcoin die-hard fans claim
that this is never going to be an issue since Bitcoin was the pioneer
and as such enjoys first-mover privilege. This argument is probably
flawed because although the BTC is used for payments, this is only a
relatively small % of all Bitcoins. One of its primary uses is being a
store of value and for this reason other crypto currencies can always
step in and enjoy similar status if aggregate demand requires it.
Is Bitcoin simply a 21st century version of gold, only
without the storage issues? Or is it just a short-lived popular fad that
may soon evolve into something quite different? Only time will tell.
The only certainty is that its price will remain very volatile in the
future.
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