Despite considerable volatility, the price of Bitcoin has climbed exponentially in recent months. The most significant cryptocurrency’s recent price surge has sparked speculation about its future. And there will be difficult questions to answer. Is Bitcoin a form of currency or not? What is the value of Bitcoin? What does the future hold for it?
True crypto enthusiasts see Bitcoin as the currency of the future, while sceptics see it collapsing at some time. Bitcoin is the subject of many debates, with differing viewpoints on even the most fundamental characteristics. The future of Bitcoin is also a point of contention; will it completely replace the current system, or will it eventually become “just” another new financial product alongside the ones we currently know?
Bitcoin’s Increasing Popularity
You’ve probably heard the phrase “money makes the world go round.” You will undoubtedly agree with this statement because economics is what causes us to earn and spend money. The concept of paper money has remained mostly intact since its invention a few centuries ago. The way we have all seen the idea of money is about to change forever with the resurgence of cryptocurrency.
The cause for this is the emergence of cryptocurrencies in 2009. You’re probably aware that Bitcoin was the first cryptocurrency to be listed on the blockchain technology and that the others we see on the market now were introduced a few years later. Cryptos had a difficult time in their early years since almost no one took them seriously. On the other hand, BTC managed to curate a worldwide audience, and now the world is going crazy over purchasing it.
Compared to April 2020, its value was almost $61,000 in April 2021, booking a 70 percent increase. This value has undoubtedly made it popular among those who had never heard of it before. As a result, many of them have begun trading. Check out bitiq.org if you want to learn more about how you can start trading in cryptocurrency.
Why Could Bitcoin Become A Global Currency?
By 2030, Bitcoin is expected to be the sixth most valuable reserve currency. Because the US dollar has lost favor due to the recent economic slowdown, China is already looking for a replacement for the global reserve currency. The European Union announced that Bitcoin and other virtual currencies should be exempt from taxes such as value-added tax, giving Bitcoin another substantial boost to its validity as a currency. Here are some of the elements that make Bitcoin a feasible global reserve currency option:
- Bitcoin transactions are viable.
- It is easier to execute transactions with blockchain technology.
- Because Bitcoin is a decentralized currency, banks and governments cannot meddle, which might be advantageous during times of political and economic uncertainty.
- Because banks are unable to exploit a person’s stored Bitcoins for their own investments, any economic downturn caused by the government will not affect Bitcoin’s value.
Bitcoin possesses intriguing characteristics that could make it a viable contender for becoming the next global reserve currency. Developers created its underlying architecture to prevent financial and political manipulation, making it ideal as a worldwide reserve currency. Currently, a supply of new Bitcoins is available every 10 minutes until the total amount of Bitcoins available reaches 21 million.
The amount of Bitcoin awarded every 10 minutes is halved at predefined intervals. It’s, by definition, deflationary. It further makes Bitcoin more stable and leads to a monetary policy based on mathematics rather than on the actions of a single person or government.
Due to the US stock market’s economic slump and lousy performance, people are turning to digital currencies since they present a more appealing option. Bitcoin is also proving to be a more attractive long-term investment than stocks.
It’s also vital to analyze how Bitcoin differs from traditional financial systems in terms of security. Even though financial systems are secure, they are nonetheless subject to phishing and hacking attacks. Bitcoin is a cryptocurrency, which is a type of digital currency that employs cryptography to safeguard virtual transactions and prevent the production of new forms of money, such as counterfeit virtual notes of traditional fiat currencies.
Bitcoin transactions are significantly more secure against hackers since it is a digital currency with an ever-improving encryption technique. These elements combine to make Bitcoin a more powerful contender in the search for a new global reserve currency.
How Can Bitcoin Become A Global Currency?
It will be possible to use Bitcoin as a new global currency if all countries agree to accept it and make it a part of their, let’s say regular economy. It means that governments need to recognize BTC as a legal form of payment. Without a doubt, such acknowledgment would significantly boost the goal of growing general acceptance of cryptocurrencies, which would further provide some good news for industry enthusiasts.
Switzerland is the first country in the world to incorporate cryptocurrency into its economy. As a result, you can use them to pay your taxes. Naturally, not every single one of them was included. We’re only talking about the two most important ones: Ethereum and Bitcoin. They would, of course, be converted into Francs, the Swiss national currency. Simply put, the government is only interested in being paid; it doesn’t matter how the people do it.
According to Jesse Powell, the CEO of Kraken, a crypto exchange, Bitcoin will undoubtedly become a worldwide currency. He highlighted his concern about the state of national currencies, predicting that they will be rendered obsolete soon. Mr. Powell isn’t the only one who has speculated about such a scenario. We believe that people are talking about it even more than they do now.
Individuals worldwide were far more enthusiastic about cryptos and their possibilities in the last two years than they had been previously. Given the high level of interest in them, it’s not out of the question that some governmental institutions may accept them. All indications point to BTC becoming the global currency in the not-too-distant future. We will, however, have to wait and see what happens.