As Bitcoin price keeps on rising, people are starting to wonder if bitcoin investment fund are still a good place to put their money. It this new cryptocurrency too good to be true ? Is the market sustainable or are we witnessing a Tulip bubble 2.0?
Let's be clear, Bitcoin is the new money and it is here to stay.
Don’t Let Bankers And Investors Fool You; Bitcoin Is No Fraud
It is a fraud; worse than tulip bulbs. It will eventually blow up. Those were the words of Jamie Dimon, JP Morgan’s CEO regarding Bitcoin’s mysterious surge in demand. He simply sees bitcoin as a remake of the Tulip bubble that took place in Dutch Land in the 1650's. A few years ago, no one bothered with Bitcoin a lot. But as 2017 draws to an end, virtually every online entrepreneur and corporations are making efforts to take part in this revolutionary currency. This partly explains the creation of so many altcoins such as Bitcoin Cash and Bitcoin Gold.
Dimon acknowledged that the blockchain technology is here to stay, but Bitcoin will be crashed into oblivion. Well, from my perspective, that similar to saying that we can keep automobiles but do away with drivers. There is no one without the other, right? Nevertheless, it’s not like there is a single switch to shut down Bitcoin. It’s a decentralized currency running on a network of many computers. There is no a single location that you can attack or shut down. Sorry guys, but that’s just one of its mystical qualities.
Sure, governments will do their best to prevent losses in tax revenues if Bitcoin becomes a threat. They will make a move on individual and companies operating in the cryptocurrency space, but one thing remains clear; the bigger Bitcoin gets, the harder it will be to control it.
It’s not only Jamie Dimon that thinks this currency is a digital scam. There are also others like Jordan Belfort, Russia’s President and the vice president of the Central Bank of Russia that think cryptocurrency market is risky and needs to be restricted. While there could be some truth in the sentiments of Bitcoin critics, it’s still ridiculous that renowned business owners and bankers don’t have adequate knowledge regarding this currency. The reality is that the Bitcoin mania of today cannot be compare to the Tulip mania of the past.
The leading cryptocurrency by market capitalization has some strong fundamentals that justify the plethora of savvy money managers that are investing in the digital gold. Bitcoin is by far one of the most transparent money systems ever invented. Every transaction, whether small or big, is recorded in an online ledger called blockchain. The ledger is controlled by hundreds of nodes around the world. Every entry is visible but permanent and thus immune to manipulation. Additionally, a lot of work goes into mining this currency. According to John McAfee, a computer programmer and the owner of MGT Capital Investments, it costs over $1000 to mine a single BTC. He called this a ͞proof of work and a sign that Bitcoin is real and nothing like the cheap Tulip craze. If you think of mining Bitcoin, then you need to invest in super fast and effective computers not to forget a lot of electricity to get running. So anyone thinking that this currency is a bubble, scam, or sham is vastly mistaken.
Albeit Bitcoin not being a fraud, there are a few things, of course, that makes this technology a bit dangerous. The impervious nature of its records has made it possible for criminals and drug dealers to use the medium to avoid being traced. Like the Mt Gox hacking issue, a lot of loss can be incurred in the case hackers land on a large pool of coins. Today, many companies can raise capital in few minutes through ICOs. This money can be used to sponsor any business including Cocaine laundering.
So, while the Bitcoin system is inherently antifraudulent, it promotes vices in the trading world. This is not to say other currencies are better off.
So what’s the bottom line? If Bitcoin were a bubble, it would have burst a few years ago. This one is here to stay although it still seems highly unlikely to replace primate currencies like the dollar and Euro. We are slowly entering a world where public and private currencies will coexist peacefully. Just as we have different apps in our phones for different purposes, we will need several wallets for various currencies. Opening a cryptocurrency wallet and investing in bitcoin is a very smart move, it does worth it. Keep on accumulating digital gold on a regular basis and a few years from now, every dollar that you are saving will be worth much more money. Be patient, be discipline and you will reach your financial goals.