With the initiation of bitcoin about one decade ago, digital finance turned into a novel era. It was intended to be a watershed moment in the financial industry. But such a revolution is still in a growing stage. The struggle-filled first decade of cryptocurrencies has been plagued by scandals, mistakes, and dramatic price fluctuations. BTC has dropped about 50% to approximately $30,000 as of May 2021 after reaching a record high of more than $63,000 in April 2021. Investors and cryptocurrency users, on the other hand, have increased their confidence in the currency’s future. As a result, the following years might be crucial for Bitcoin and cryptocurrencies in general. In this text, we will be evaluating Bitcoin’s second decade.
Bitcoin was designed to be a borderless and decentralized alternative to government- and central-bank-controlled fiat currencies, However, it was stated by its pseudonymous inventor Satoshi Nakamoto in a foundational paper published on Oct. 31, 2008. The Bitcoin network is not depending on third-party mediators to reach a consensus on a transaction. Instead, blockchain is used to verify and validate a transaction. Blockchain is a peer-to-peer network of systems with electronic ledgers.
However, over the past 13 years, that original idea appears to be in jeopardy by some scams and disadvantageous uses. Centralization has supplanted decentralization. Bitcoin whales, or investors with large holdings of the cryptocurrency, are considered to exert market power over its price. The democratization of mining as a means of producing money has been compromised in favour of the efficiency of large-scale mining farms. Scaling issues plague Bitcoin’s technology, resulting in a long history of splits and altcoins.
Fortunately, such disadvantages are outweighed by the development of a strong and active crypto ecosystem. The cryptocurrency market is now worth more than $2 trillion, despite the fact that it did not exist a decade ago. Even now, some countries like El Salvador have made bitcoin a legal currency.
What would be within bitcoin's second decade?
The mid and end of bitcoin’s second decade might be crucial for Bitcoin’s development. Aside from financial revolutions, there are a few aspects of Bitcoin’s environment to which investors should pay particular attention which was severely discussed few months ago.
At the moment, Bitcoin is torn between becoming a store of value and a transactional medium. Even though governments throughout the world, such as Japan, have recognized it as a viable means of payment for products, institutional investors are keen to join in on the action and profit from the volatility in its pricing. But this has been a bit challenging due to the scalability issue.
However, without technological advancements in its ecosystem, Bitcoin’s mainstreaming as a payment method will be impossible. Bitcoin’s blockchain must be able to process millions of transactions in a short period of time to be regarded as a viable investment asset or method of payment. Several technologies, such as the Lightning Network, offer scalability in the company’s operations. New cryptocurrencies, such as Bitcoin Cash/Bitcoin Gold, have emerged as a result of hard forks in the Bitcoin blockchain, with the goal of adjusting the ecosystem’s settings to handle more transactions at a quicker speed.
Bitcoin’s price has risen to approximately $60,000 so far in 2021, before dipping to roughly $30,000. However, large banks and strong states are still paying attention to bitcoin in order to make it a legal and legally usable currency. Hopefully, if it could be on the positive side within bitcoin’s second decade, it is worth it for the investors!
- The above discussion is neither financial advice nor financial recommendation. It is a basic study on cryptocurrency which is done based on resource sources. Therefore, our team accepts no responsibility or liability for any predictions/decisions you make in the industry.