In recent times, the bitcoin race has been exponential: the prices during the year have exceeded 20,000 dollars.
Now, many people are wondering if the bitcoin’s value will continue to rise. Should private investors spend a portion of their savings, or even their pension funds, to invest in bitcoins?
1) The most important investors and the financial industry are taking them seriously
Since their creation in 2008, the most important bitcoin supporters have been tech lovers, liberals and anarchists. But they are recently followed by a growing number of traditional investors and entrepreneurs who see bitcoins and other digital currencies as legitimate asset classes, such as stocks, bonds and commodities.
Only in 2017 hedge funds have invested hundreds of millions of dollars in digital currency. Meanwhile, the digital infrastructure that supports bitcoins and high digital currencies is maturing rapidly. Coinbase allows margin trading since March, while the Commodity Future Trading Commission has given companies the right to sell options in digital currency and other derivatives. In 2018 bitcoin, thanks to the investors, it reaches 20,000 dollars.
2) The amount of bitcoin is limited
The reason that bitcoins are a precious resource is that there are only 21 million and most have already been extracted. The number of bitcoins that can be extracted is cut in half every few years, to date about 80% of all bitcoins have already been emitted and their mining will end in 2040. This scarcity feature could keep the demand going, especially if (as is rumored) central banks should decide to start buying them as a foreign currency reserve.
3) Bitcoin is the new gold
Many people like to have gold because it is a resource whose value is not under the control of governments. Even if a country is devastated by the war or if the central bank decided to print an excessive amount of money, the value of gold (unchanged) .. Bitcoin has many of these same qualities.
4) The global economy is near to collapse
The economic situation is unstable around the world, Bitcoin is a fairly unrelated asset and will probably benefit from the potential collapse of the traditional economy. This means that it is smart to diversify some bitcoin funds.In 2008 the economy collapsed due to unsustainable debt structures, many people do not understand is that debt has only risen since then. It is quite possible that in the coming years we will see an even bigger collapse. Recently, the political situation in many areas of the world has become more unstable and the advent of commercial wars between large countries will not help the situation. Political instability and global crises are a strong point for bitcoins and many people and investors could look in the future for bitcoins as an alternative currency.
5) Bitcoin is a “mature” market to exceed the Forex markets
The stable bitcoin prices are an indicator of the fact that the currency is gaining global acceptance, coming closer to being a regular market, according to a research of a company based in Poland.The report, called ‘Bitcoin market route to maturity’, says that the BTC is now on the verge of being a valid “competition for the Forex markets.The study tracks the changes in the retail price of Bitcoin since 2012 and the various factors that led to fluctuations in the markets. After studying the factors, including volatility self-correction and yield distributions, the report concludes that Bitcoin and its market look oddly similar to those of a market maturation curve.