If you had spent $27 on Bitcoin when it was created by Satoshi Nakamoto in 2009, your investment would now be worth over $37,000,000.
Widely regarded as the greatest investment vehicle of all time, Bitcoin has experienced a meteoric rise from $777 to $17,000 in 2017.
Bitcoin has turned opportunistic investors into millionaires and left financial institutions gaping. Bitcoin has answered its critics at every milestone this year, and some believe this is just the beginning.
The December 10 launch of bitcoin futures, which will allow investors to enter the bitcoin market for the first time through a major where to sell litecoin in nigeria regulated U.S. exchange, suggests we’re just getting started.
What makes Bitcoin so valuable is that there is only a finite amount. There will only ever be a maximum of 21 million bitcoins and unlike regular fiat currency, you can’t just print more of it whenever you want. This is because bitcoin runs on a proof-of-work protocol: to create it, you must mine it using computer processing power to solve complex algorithms on the bitcoin blockchain. Once this is achieved, you will be rewarded with Bitcoin as payment for the “work” you have done. Unfortunately, the reward you get for mining has dropped drastically almost every year since the introduction of bitcoin, meaning that for most people the only viable way to get hold of bitcoin is to buy it on an exchange . At current price levels, is this a risk worth taking?
Many believe Bitcoin is simply a bubble. I spoke to cryptocurrency expert and long-term investor Duke Randal, who thinks the asset is overvalued: “I would compare this to many supply and demand bubbles throughout history, such as the Dutch tulip mania and the dot-com bubble of the late ’90s. The prices are based on pure speculation, and when you look at Bitcoin’s functionality as an actual currency, it’s almost embarrassing.” For those who don’t know, the dot-com bubble was a period between 1997 and 2001 when many Internet companies were founded and got outrageously upbeat ratings based purely on speculation, which later plummeted 80-90% when the bubble started to burst in the early 2000s.Some companies like eBay and Amazon have rallied and are now well above those ratings, but for others it was the end of the road.
Bitcoin was originally created to take power away from our financial systems and give people control of their own money, cutting out the middleman and enabling peer-to-peer transactions. However, it is now one of the slowest cryptocurrencies on the market, its transaction speed is four times slower than the fifth largest cryptocurrency and its closest payment solution competitor, Litecoin. The untraceable privacy coin Monero makes transactions even faster, boasting an average block time of just two minutes, a fifth of the time Bitcoin can do so, and it does so without anonymity. The world’s second largest cryptocurrency, Ethereum, already has a higher transaction volume than Bitcoin despite being valued at just $676 per Ether compared to Bitcoin’s $16,726 per Bitcoin.
So why is bitcoin value so high? I asked Duke Randal the same question. “It all goes back to the same supply and demand economics, relatively not very much bitcoin is available and the recent price surge has attracted a lot of media attention, this combined with the launch of bitcoin futures which many are seeing as the first sign bitcoin is going off the mass market accepted, which has led to many people jumping on the bandwagon for financial reasons. As with any asset, when there is more demand to buy than to sell, the price increases. This is bad because these new investors are entering the market without understanding the blockchain and the underlying principles of these currencies, which means they are likely to be burned.”
Another reason is that Bitcoin is extremely volatile. It has been known to move thousands of dollars up or down in under a minute which, if not used or not expected, causes less experienced investors to panic sell resulting in a loss. This is another reason Bitcoin will struggle to be accepted as a means of payment. The bitcoin price can move significantly between the times vendors accept bitcoin from customers and resell it on exchanges for their local currency. This unpredictable movement can wipe out your entire profitability. Will this instability go away soon? Unlikely: Bitcoin is a relatively new asset class and while awareness is rising, only a very small percentage of the world’s population holds Bitcoin . Until it becomes more diversified and its liquidity improves significantly, volatility will persist.
So if bitcoin is pretty much useless as actual currency, what are its uses? Many believe that bitcoin has evolved from a viable form of payment to a store of value. Bitcoin is like “digital gold” and is simply used as a benchmark for other cryptocurrencies and blockchain projects to be measured and traded against. Recently, there have been stories of people in hyperinflationary countries like Zimbabwe buying bitcoin to hold on to their wealth rather than see its value plummet under the ruthlessness of its central banking system.
Is it too late to get involved with Bitcoin? If you believe in what these cryptocurrencies will do for the world then it’s never too late to get involved, but with Bitcoin’s cost being so high, for some it’s a boat that has already sailed. You might be better off taking a look at Litecoin, which is up 6908% for the year, or Ethereum, which is up a whopping 7521% for the year. These newer, faster currencies hope to achieve what Bitcoin originally set out to do when it was created in 2009, and replace government-run fiat currencies.
What are the top 5 cryptocurrencies besides bitcoin?
Bitcoin has led the crypto world for so long and so dominantly that the terms crypto and bitcoin are often used interchangeably. However, the truth is that the digital currency is not just made up of Bitcoin. There are numerous other cryptocurrencies that are part of the crypto world. The purpose of this post is to educate our readers about cryptocurrencies other than bitcoin to give them a wide range of options to choose from – if they intend to make crypto investments.
So let’s start with the first name on our list, that is:
Litecoin was launched in 2011 and is often referred to as “silver to bitcoin’s gold”. Charlie Lee – MIT graduate and former engineer at Google – is the founder of Litecoin.
Similar to Bitcoin, Litecoin is an open-source, decentralized payment network that works without a central authority.
Litecoin is similar to Bitcoin in many ways and often makes people think, “Why not with Bitcoin? Both are similar! “. Here’s a catch: Litecoin’s block generation is much faster than Bitcoin’s! and this is the main reason traders around the world are becoming more open to adopting Litecoin.
Another decentralized open source software platform. Launched in 2015, the currency allows building and running smart contracts and distributed applications without downtime.
The applications on the Ethereum platform require a specific cryptographic token – Ether. According to Ethereum’s core developers, the token can be used to trade, secure, and decentralize almost anything.
Ethereum underwent an attack in 2016 that split the currency into two: Ethereum and Ethereum Classic.
In the race of leading cryptocurrencies, Ethereum is the second most popular, right behind Bitcoin.
Zcash was launched in late 2016. The currency defines itself as follows: “If bitcoin is like http for money, zcash is https”.
Zcash promises transparency, security and privacy in transactions. The currency also offers the option of a “shielded” transaction, allowing users to transfer data in the form of an encrypted code.
Dash is originally a secret version of Bitcoin. It is also known as “Darkcoin” due to its mysterious nature.
Dash is popular because it offers enhanced anonymity, allowing its users to make transactions impossible to trace.
The currency first appeared on the digital market canvas in 2014. Since then, she has experienced a large following in a very short time.
With a market cap of over $1 billion, Ripple is the last name on our list. Launched in 2012, the currency offers instant, how to sell litecoin on trust wallet secure, and low-cost payments.
Ripple’s consensus book does not require mining, a trait that sets it apart from Bitcoin and other mainstream cryptocurrencies.
The lack of mining reduces processing power, which ultimately minimizes latency and makes transactions faster.
Although Bitcoin continues to lead the crypto pack, its competitors are picking up the pace. Currencies like Ethereum and Ripple have overtaken Bitcoin in enterprise solutions and are growing in popularity every day. Following the trend, the other cryptos are here to stay and will soon give Bitcoin a really tough time maintaining its stature.