Bitcoin has been around for more than a decade and it continues to attract a lot of attention from investors, entrepreneurs, and speculators. The digital currency has seen its fair share of ups and downs in that time, but its exponential growth since the beginning of 2017 shows no signs of abating. While there are still plenty of skeptics who believe that the price run-up of late is simply another speculative bubble, there’s also a growing number of people who see real potential in this new payment network. In this article, we’ll explore some possible ways that the world might look at the future of Bitcoin in 4 prognostications.
Regulation Will Tighten Up On Bitcoin
As Bitcoin grows, more governments will inevitably become more interested in the digital currency and its potential impact on their financial systems. In many ways, Bitcoin is a very subversive type of technology; rather than being controlled by banks or governments, it’s managed by the people who use it. Bitcoin is the first decentralized currency, which could potentially make it a menace to any kind of existing authority.
Over time, if Bitcoin becomes more mainstream, regulators and other financial authorities will likely become more interested in it. This, of course, could all be positive for Bitcoin. Governments and financial institutions have the resources and expertise to not only understand Bitcoin and the technology behind it but also to provide oversight and regulation around it. Trading on BitLQ or other exchanges will be highly regulated by governments in the future.
If Bitcoin ends up under the control of regulators and authorities, it may help to legitimize the digital currency as a whole and prevent it from being a vehicle for money laundering and other illegal activities.
Bitcoin Replaces Fiat Currency
For Bitcoin to become more mainstream, it’ll likely have to replace the existing fiat currency system. In many ways, this will be easier said than done. First, the existing financial system is highly entrenched and resistant to change. Even if the majority of people start to use Bitcoin as a form of payment, the existing financial system will likely continue to exist. Many people believe that the existing system will inevitably be boosted by blockchain technology. This means that the existing financial system will likely continue to exist alongside Bitcoin and blockchain technologies will become more important in the financial world. Bitcoin, as a cryptocurrency in its own right, is not likely to completely replace fiat currencies like the US dollar, Euro, and Japanese Yen. Instead, it will probably be used primarily as an alternative to fiat currency.
Bitcoin Becomes the New Gold Standard
If Bitcoin replaces fiat money, it’ll become a new form of the gold standard. One of the attractive features of gold is that it’s a highly durable form of money, which can be easily exchanged for goods and services. It also has a relatively low risk of inflation over time, making it a good store of value. As a digital currency, Bitcoin has many of the same attributes as gold. It’s durable and portable, making it excellent as a store of value. It’s also fairly low-risk since it has a limited supply. If Bitcoin or another cryptocurrency replaces the existing fiat currency system, it could become a new form of the gold standard.
A Decentralized Network for Financial Services
As we’ve seen with other Cryptocurrencies like Ethereum and Litecoin, it’s possible to build a decentralized network for financial services. By using blockchain technology and a decentralized network, it’s possible to create a new decentralized financial system that operates autonomously of any single entity. This would mean that no single financial institution would have control over the system, which would once again potentially make the system a threat to existing authorities. By replacing traditional financial systems, decentralized networks could end up acting as an open-source alternative to proprietary financial systems. This would give people options and provide them with more choices about how they conduct their daily financial business.
In this article, we talked about some of the possible ways that the world might look at the future of Bitcoin in 4 prognostications. Bitcoin hasn’t reached its full potential yet, so there’s a chance that we could see the digital currency become even more popular and disruptive in the future. As more people start to use digital currency, governments may become more interested in it and regulate it. This could help to legitimize the digital currency and prevent it from being used for money laundering and other illegal activities.