It’s been an exciting time for Bitcoin investors all over the world. Prior to China’s announcement that they would be embracing blockchain technology, the market sentiment appeared to be rather morose.
On the 25th of October 2019, prices for BTC were as low as $7,500 in the wake of several rather unsettling events in the market. So if you’ve either bought or sold Bitcoins over the past week, chances are you’d be either over the moon or crying yourself to sleep.
Given the contentious nature of cryptocurrencies and the fact that governments remain undecided over its legality, it should come as no surprise that these unregulated currencies are extremely volatile.
Despite what the pundits were previously saying about 2018 being the possible end of Bitcoin, it would appear that all bets are off in this market. Hence, what can we expect to see from Bitcoin and other cryptocurrencies in the near future?
In this article, we take a look at why cryptocurrencies are more than likely here to stay.
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An increase in government instability
At the risk of sounding like a conspiracy theorist, it’s fair to say that we can expect to see a rise in failing governments as we move forwards into the future.
Rising income inequalities, the pervasive nature of fake news and the ease at which information can be shared makes for a heady mix. As we’ve seen by the collapse of Venezuela and civil unrest in Chile, people are unhappy and they’re making it known.
On the long-term, as trust in authority figures and government institutions begin to erode, we may see people abandoning fiat currency in favor of cryptocurrency. Unlike paper money, cryptocurrencies like Bitcoin and Ethereum are unaffected by government or economic factors. Hence this makes them a popular alternative for people living in countries with corrupt or incompetent governments.
As we’ve seen by the situation in Venezuela, cryptocurrencies can be used an effective medium of exchange in the event of a societal collapse. The widespread availability of smart devices is also another contributing factor to the rising popularity of cryptocurrencies.
With cryptos, one is able to transfer funds and make payments all without having to rely on local infrastructure.
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Rising calls for regulation
Crypto’s strongest asset has always been the lack of governmental intervention. As was the ultimate goal of Satoshi Nakamoto, Bitcoin and other cryptocurrencies were meant to provide users with an alternative currency that would not be affected by government policies.
However, the pseudo-anonymity offered by crypos along with the lack of transparency has been a cause for significant government consternation. Many believe that the pseudo-anonymity offered makes it easier for criminals and terrorists to launder cash and transfer funds in secret.
If the U.S government’s reaction towards Libra is anything to go by, we may even expect to see an outright ban on cryptocurrencies in the near future. This however is quite unlikely given the vast potential offered by crypto. Instead, we should expect the government to introduce sterner regulations related to reporting and fund transfers.
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Financial institutions will start accepting cryptocurrencies
As far-fetched as this theory sounds, it may not be such a wild idea after all. Recognizing the potential of cryptocurrencies, chances are banks and other financial institutions may begin accepting cryptocurrencies.
This means things such as crypto bank accounts, crypto ATMs and even crypto-related financial instruments may soon become a reality. Given that major retailers in the United States have begun accepting cryptocurrency payments, it’s only a matter of time before financial institutions are forced to adapt and evolve.
Even some sports teams, like one of the top NBA betting odds team, the Sacramento Kings, are now rewarding their fans with crypto tokens.
The crypto market is certainly an exciting one with plenty of opportunities, however it is also extremely volatile and subject to much scrutiny. However, the fact remains; cryptocurrencies are here to stay.
