With the vast amounts of people suddenly becoming millionaires, the chances of you not hearing about Bitcoin are almost nil. The success stories are all over the internet. Even the already rich rap-star 50 Cent added his name to the ever-growing list of Bitcoin millionaires. He claims that over the last few years he has been sitting on a “forgotten” fortune of 700 virtual coins that he made selling his album back in 2014. Is he a smart investor or a lucky guy? No one knows, but the truth is that he is now worth $7 million more than last year. Cheers, 50 Cent, this is what we call a flying start to the new year!
In 2017 Bitcoin managed to become so popular that it is an absolute rarity to live in the western world and not to have at least one friend or a relative who is somehow engaged in cryptocurrency trading. User-friendly virtual money exchanges such as Coinbase started gaining speed making the purchase of cryptocurrency as easy as requesting an Uber ride. People who wanted to invest no longer had to wire money to exchange sites but use a simple app to purchase some of the crypto-gold with a credit card. Last year was also the year that saw Bitcoin increase its value 20 times and become the 6th most valuable currency in the world.
While Bitcoin’s price kept surging, there were a ton of leading economists such as Jamie Dimon, chairman and CEO of JPMorgan Chase, and billionaire investor Warren Buffett, who said the crypto-world might be doomed. Jamie called it a fraud and Warren kept warning everyone that the craze over Bitcoin and other cryptocurrencies won’t end well. Even Jordan Belfort, also known as the real Wolf of Wall Street and the man who predicted the 2008 financial crisis, called Bitcoin a “huge danger.” Things are never perfect, Bitcoin lost half of its gains but still managed to close 2017 about ten times more valuable than it started it.
Love it or hate it, there is no doubt, 2017 was the year of Bitcoin! Over the last 13 months, Bitcoin has been a subject of enormous attention and is rapidly changing the landscape of the financial world boldly paving the way for other cryptocurrencies such as Ethereum, Ripple, Bitcoin Cash, Litecoin, Monero, and Zcash. While Bitcoin was the primary currency making the news, it’s contenders had a good year too as almost all of them registered even better growth percentages than Bitcoin.
What about 2018?
High volatility and the lack of understanding have been scaring many investors away from the crypto-world. While governments are trying to regulate the market, it still feels like it is the wild west. Exchanges have been prone to hacks, investors have been afraid to jump in due to the lack of regulations and regular folks have been avoiding the crypto-world because of the lack of non-user friendly crypto exchanges. However, things are changing – governments from all over the world are starting to realize that instead of fighting the new currencies, they can tax the transactions and get their piece of the pie. New and stricter laws are making Initial Coin Offerings more and more transparent and regulated, and in 2018 exchanges in the US will most likely be forced to report every account trading more than $20k to the IRS. Exchanges are continually trying to increase security, and there are user-friendly exchanges like Coinbase who are allowing everyday people to participate. Cryptocurrencies will continue to be part of our lives in 2018.
What is the future of cryptocurrencies?
In 2018 we will see more and more governments trying to regulate cryptocurrencies, we will witness the creations of more altcoins, and we will see how Bitcoin’s main competitors Ethereum; Monero; ZCash; and Ripple, try to take a shot at Bitcoin. The new 2018 may be the year that will see Bitcoin being taken down from its throne. This wouldn’t be a first for the tech world – Nokia’s Symbian was the primary modern mobile OS, but later it got overshadowed by better mobile operating systems such as Android and iOS. This might be the case with Bitcoin too. The time will show!
On the other hand, Bitcoin has been known as the gold of the cryptocurrencies. It may stick around, but it won’t be the game-changer technology that will transform the financial world. The cashier at Stater Brothers won’t be happy if you try to pay for the groceries with gold bullions – you will most likely be asked to use a credit card or cash instead. This is what is happening with Bitcoin. Stripe, one of the first firms to help users do financial transactions with Bitcoin, recently announced that they would be stopping the support of Bitcoin payments saying the fees are too high. And people do not blame them for their decision, Bitcoin transaction fees can easily reach amounts of $20+, while transactions with currencies such as Ethereum and Ripple only cost a few bucks.
While governments are desperately racing each other to find ways to regulate the decentralized virtual currencies, they are also exploring opportunities of creating their national cryptocurrencies too. So the next groundbreaking virtual money might have not even been invented yet. The masses are more likely to support a government-backed cryptocurrency than the ones associated with the dark web that we see now.
If you are thinking of entering the world of crypto, or you are already in, you have to bear in mind that it is an extremely risky investment and there is no insurance for your assets. Hackers are lurking around so securing your digital wallet should be a high priority. Always make sure you have antivirus software on all your devices. Having another layer of security can prevent cybercriminals from gaining access to your digital coins. It only takes seconds for hackers to send your virtual money away from your wallet, and once it leaves your digital portfolio, there is no way of getting it back. Be prepared!
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