Future Trends: Evaluating Bitcoin’s Stake In The Next Decade

It has already been over a decade since Bitcoin was introduced.

Many believed that it was supposed to revolutionize the finance ecosystem. However, the truth is far from this belief.Bitcoin trends

The first decade of cryptocurrency is marked by several missteps, wild price swings, and of course, scandals.

And to top it off, this year’s slump in its price has alarmed censures.

This is undoubtedly a turning point in its existence, as many cryptocurrency critics and investors are starting to doubt its future.

The next decade could be the real-world test for the most popular cryptocurrency.

The Original Vision

On Oct. 31, 2008, Satoshi Nakamoto (the pseudo inventor behind the digital currency) published a seminal paper. He proposed Bitcoin to be a borderless and decentralized alternative to government-controlled fiat currencies in the article.

Notably, the consensus for any transaction on the network is independent of third-party mediators. And Blockchain helps achieve this peer-to-peer system for trades.

Blockchain is a decentralized electronic ledger where encrypted information can be stored. The network is open to all, but only members or participants can add or remove any block of data.

Now, the initial idea behind eliminating any mediators was to reduce transaction costs.

Consider this – mediators increase transaction cost when they charge a service fee. As a result, the minimum practical transaction size also increases, cutting off the possibility of everyday transactions.

The Current Scenario

While the currency started at an outstanding feat, it seems the original vision has been compromised.

For instance, decentralization has indeed given way to centralization.

To put this into perspective, consider this – whales or institutional investors with extensive holdings have control over the market.

Moreover, the mining farms are taking away the democratic principles of printing money. In fact, the Chinese company – Bitmain owns more than 75% of the market for mining cryptocurrencies.

Besides, what’s more, interesting is the fact that Bitmain is originally a semiconductor manufacturer.

On top of all this, cryptocurrency technology is shredded and poses scaling problems.

But, at the same time, these drawbacks are balanced by the growth and vibrance of the crypto market. The market, which didn’t even exist a decade ago, is currently thriving at $1.56 trillion.

Today, there are more than 1500 cryptocurrencies. And they all are being traded on certified exchanges since Bitcoin has debuted.

Apart from this, Blockchain, the technology behind cryptocurrency’s success, is being touted to solve complex computing and data storage issues.

El Salvador became the first country to accept Bitcoin as a legal tender on June 9, 2021.

What Could The Next Decade Look Like?

The next decade could perhaps be the decisive factor for Bitcoin’s success.

Investors would need to pay close attention to many areas in its ecosystem.

At the moment, cryptocurrencies are somewhere between being a store of value and a mode for daily transactions. Institutional investors want to make profits out of its volatility. In contrast, governments like Japan are declaring it a valid form of payment for goods.

However, as already mentioned, there are scalability limitations to its original system. And this limitation is preventing both occurrences from turning into a reality.

The security issues of yesteryears are arguably the most significant failings for cryptocurrencies. It is noteworthy that Bitcoins worth billions of dollars have been stolen from exchanges by hackers.

Experts opine that a secure ecosystem can lead to its widespread adoption. And possibly, down the line, Cryptocurrencies may become mainstream and have a different reputation.

Although this widespread adoption would also need improvements in the technology behind cryptocurrencies.

For instance, to become a viable mode of payment or even an investment asset, Blockchain should be able to handle millions of transactions simultaneously.

Thankfully, new technologies like Lightning Network are promising enough to scale up the speeds in blockchain operations.

Other Market Influencers

Apart from the improvement in Bitcoin’s blockchain system, other market factors may influence its future stake.

For instance, other cryptocurrencies, like Ethereum, are tough competitors. As of January 2021, Etherium had a market value of $138.3 billion.

Although other cryptocurrencies still lack the valuation that Bitcoin has achieved in the years since its introduction, they are growing at a rapid pace.

Many investors and whales are already looking towards other alternatives to it to expand their portfolios.

Ripple’s CTO David Schwartz, in 2018, compared it with Ford’s Model T.

The automobile’s maker announced revolutionizing the entire ecosystem of the transportation industry. Now, thanks to the extensive media coverage, the change has already begun.

Evolving regulations and technology pace are also contributing towards its acceptance in real-world transactions.

Not to mention that this year in March, the currency reached its highest ever value, closing at over $60,000.

But soon, it also tipped close to half, following a tweet from Tesla’s and SpaceX’s CEO – Elon Musk.

There is still a lot of confusion and uncertainty in the market concerning Bitcoins and their application. Although it has already proved to be a hedge against inflation, it still isn’t popular enough to enter the mainstream and replace centralized currency modules.

To Sum It All Up…

The following decade is undoubtedly pivotal to the acceptance and growth of this cryptocurrency.

Until recently, it was gaining much popularity among investors and institutions. However, recent opinions about its environmental impact and China’s take on mining companies have toppled the foundation.

If the anticipated changes are implemented, the market would undoubtedly be all bright for this digital asset. Given that, investors (short-term and long-term) are still considering it to be a profitable asset.

Not to mention that the currency has already bagged over a 9000% increase in its value since it was introduced.

On this note, it seems a profitable investment for new investors, both institutional and individual. The only key to earning profits in the cryptocurrency world is holding on to it for your dear life (HODLing).

The decade looks promising with some ripples and rapids. Other than that, there is hardly anything stopping Bitcoin from becoming a class 1 asset for investments.