Bitcoin – At the Crossroads of the Future

The Predictions

As people around the globe increase their awareness about the crypto-currency revolution, investment experts are lining around express their opinions. In recent weeks, the pro-crypto forecasters are predicting numbers that defy gravity. It isn’t uncommon to visit a prognosticator on TV explaining why they believe Bitcoin is destined going to ranging from $250,000 and $500,000 per coin next two years. At $500,000, the coin would have to increase more that 6000% from it’s current levels. The numbers are mind-boggling.

On the far side of the fence, we discover the naysayers. There are Wasabi Wallet -respected financial analyst who aren’t afraid to warn people about the investment bubble. Some even admit that crypto-currencies might still have some play left inside them, but sooner or later, the bubble will burst, and people are likely to get hurt. To drive home their point, they only need to think about the IPO bubble of 2001.

The Technical Hurdles

The crypto-currency revolution is still in its infancy. Therefore, most coins, Bitcoin included, are trading without historical indicators to greatly help investors. It is just a free market in the purest form. Unfortunately, free market trading is vunerable to influence from all directions. Therein lies the rub for crypto-currency investors. Without history to fall back on, investors need to make decisions based on their gut.

The obstacles that complicate the decision-making process for Bitcoin investors are plenty. The coin is definitely vunerable to the technical aspects of trading. The exponential upsurge in price has been driven by high demand and scarce product. Still, investors get yourself a little antsy when the price increases an excessive amount of, too fast. Then we see the typical correction that comes when an investment becomes over bought. The problem is these corrections are proving to be harsh, which tests the mettle of investors who aren’t used to such high levels of volatility.

Setting technical analysis aside, technology issues are also driving the market today. There is no denying that the crypto-currency market has already established its issues. After proclaiming block-chain technology to function as securest approach to disseminating information, you can find holes that are being exposed daily. The bugs will get worked out as this sort of technology seems destined for prime time. Unfortunately, Bitcoin has block-chain technology under a microscope right now.

No matter how secure any system may claim to be, hackers will definitely expose the weaknesses in a hurry. The crypto-currency industry was already besieged by hackers, who have stolen vast amounts of dollars in Bitcoin and other crypto-coins. Losing money to hackers can make investors just a little jittery. It also makes for plenty of litigation from those harmed by technology which could not yet be considered a secure as promised.

The Fundamental Hurdles

There’s a vintage adage: When school teachers and janitors start making millions from investing, prices are likely to crash because we are in need of school teachers and janitors. The truth is governments get nervous when its residents start losing profits or making lots of money without paying taxes. It’s no coincidence that India and South Korea are among the most active countries on the crypto-currency exchanges, yet both governments are considering banning the trading of most cryptos. THE UNITED STATES, potentially the world’s biggest Bitcoin player, is working in Congress to decide how to regulate the crypto-currency market. They have already banned several exchanges for possible fraudulent activity. China is discussing an outright ban while Europe seems poised to check out America’s lead.

If Bitcoin or any other crypto-currency aspires to becoming an international currency for everyday payments, success would be based on the world’s biggest economies joining in the parade. Unfortunately, the major players (mentioned above) appear to be moving in the other direction.

The biggest concern appears to be Bitcoin’s appeal to the criminal element. Proof has been presented that shows North Korea has been stealing Bitcoin to help finance its nuclear program. ISIS routinely moves money among its affiliates via Bitcoin, doing so undetected until it’s too late. The drug trade can be enjoying the anonymity afforded them by block-chain technology. Increasingly more Initial Coin Offerings (ICOs) are proving to be nothing more than common scams. They are all serious issues.
These are all fundamental conditions that should be favorably resolved if crypto-currencies are to survive and someday thrive.

Looking or Solutions

For the most part, people are interested in all aspects of crypto-currency. Bitcoin has recently shown the potential for easily resolving payment issues between customers and vendors. However, trust is a big issue going forward. If the anonymity feature is the driving force behind the crypto-currency revolution, it’s going to be hard to obtain governments to climb aboard and approve crypto-trading.

Let’s look at how South Korea decided to resolve the Bitcoin issue. The South Korean government recently passed a bill that provides six Korean banks authority to let its customer trade Bitcoin from their bank accounts. There’s only 1 stipulation: the account must be opened in the customer’s real name. Poof! There goes the anonymity feature. However, South Koreans can still trade Bitcoin through a Bitcoin Wallet so long as tax evasion isn’t the reason why they want to achieve this. It is a nice compromise, but its appeal could be limited.

Over the next few months, investors should start getting answers to a lot of questions. Until that time, the pricing of Bitcoin along with other crypto-currencies will stay volatile. The price increase because of demand but will drop every time a new issue becomes news. Until prices stabilize, people should focus on one rule of investing. Never invest more income you could afford to reduce. Indeed, Bitcoin is reaching its crossroads.