Till a few weeks ago, Bitcoin was on exponential growth. From 0$ in 2009 to implausible $63,000 in April 2021, the most popular cryptocurrency has been on a tumultuous journey ever since its beginning. However, things have been rough for Bitcoin lately. With Tesla stepping away from accepting the cryptocurrency as a payment mode, to China’s crackdown, Bitcoin has dropped down to $36,000 and has been fluctuating around that figure ever since. So what is the future of Bitcoin from here? Is it ever going to recover?
The future of Bitcoin?
Satoshi Nakamoto founded Bitcoin on Oct 31, 2008 with a vision of replacing bank-controlled fiat currency with a universal and decentralized alternative. And this is the reason why Bitcoin and other cryptocurrencies are becoming exceedingly popular among common people.
It’s like a financial revolution that might end up changing the face of how money works.
With recessions, income inequity, poverty, accumulation of wealth, and the autonomies of bank over people’s money, there is huge cynicism and distrust among people. Cryptocurrency is serving as an antidote to that cynicism and distrust. The fact that nobody else is owning your money — it is a huge impetus to the DeFi wave that is taking 21st century by storm.
Let’s understand how exactly Bitcoin works?
The functioning of fiat currency is made possible through a central regulatory body that maintains a centralized ledger for every transaction. This body knows everything about your money, how much you have, your receipts, expenditures, and so on. This central body is also responsible for how the money will flow in the economy, while also tracing back any sign of notorious activity.
For some, it is the best financial system as it ensures safety and justice while owning money.
For others, it an autocratic system that tracks every activity and is facilitating income inequity. In other words, these are the people who want freedom of money, and sole ownership over the finances they own.
Cryptocurrency serves the second category. It works on blockchain technology which is a peer-to-peer network of electronic ledgers that only belong to the originator of a particular transaction. No third party can break into that ledger unless it is virtually stolen or hacked. And that is the biggest concern of authorities and investors — the safety of cryptocurrency.
But another problem that Bitcoin is now encountering, is the contradiction of its terms. One of the biggest traits of any cryptocurrency is “decentralization”. However, with the increasing popularity of BTC, there is an influx of “Bitcoin whales” which are accounts with massive holdings, in a way making Bitcoin centralized.
These “Bitcoin whales” are now manipulating the market according to their profit thus contradicting the idea of decentralization.
China recently banned Bitcoin mining because the authorities of Beijing still believe for cryptocurrency to be a bubble. According to China, this move will protect the economy from the bubble that will leave a massive disorder when it bursts.
So what is the future of Bitcoin?
Despite the world’s cry over the decline of the cryptocurrency era, the truth is that decentralization is the future. Back in the 20th century, just a handful of people believed in the possibility of the way we are using the internet today. These handful of people were the ones who actually led the revolution and gave the current shape to the internet. However, times have never been more dynamic and we are again in a transition stage, this time from web 2.0 to web 3.0.
The future, i.e. web 3.0, is decentralized internet.
What is decentralized internet?
It is the internet that runs on blockchain technology. Unlike today, people will surf the internet through a peer-to-peer network without the interference of any third party. Evidently, any transaction that takes place on web 3.0 will again be facilitated through a decentralized wallet and a ledger.
If this isn’t enough, here is something to add to the hype — we might not have yet entered web 3.0. era, but the technology that will make it possible. It is already here being put to use. Guess where?
The answer is Cryptocurrency
Bitcoin and Ethereum are the technologies that will drive the functioning of web 3.0. Experts even call Ethereum, the backend technology of decentralized internet. There are plenty of other tokens and coins that are also serving the same technical purpose.
So why is Bitcoin price plummeting and will it ever rise?
The rise or fall of Bitcoin now comes down to one thing — technology upgradation.
This technology upgradation will serve two purposes. First, to make DeFi experience for investors, more secure and safe. And second, to meet the criteria of changing world order which is climate change (you thought politics!?).
Norway’s second richest man Kjell Inge Røkke is working on setting up a company that will produce ‘green bitcoins‘. The action plan of this company is to
Establish mining operations that transfer stranded or intermittent electricity without stable demand locally — wind, solar, hydro power — to economic assets that can be used anywhere.
Bitcoin, he writes, is “a load-balancing economic battery, and batteries are essential to the energy transition required to reach the targets of the Paris Agreement.
In another part of the world, Chinese miners are digging out Bitcoins in seasonal shifts of inexpensive hydropower in summers and coal during the winters. Similar cheap hydro sources of power to mine Bitcoins are being used in Canada and U.S. Pacific Northwest.
None of the methods have yet convinced the world of being truly green, however, researches and efforts are constantly being carried out. Despite everything, institutions are still vouching for Bitcoin.
Astrobotics, America’s one of the most leading companies developing space robotics technology for lunar and planetary missions — announced that it will put a real bitcoin wallet on the surface of the moon. On the other hand, the President of El Salvador, Nayib Bukele has partnered with Square to create a modern financial infrastructure with the help of bitcoin technology.
El Salvador soon might become the first country in the world to accept Bitcoin as legal tender.
These and plenty of other pieces of evidence suggest that Bitcoin is here to stay and therefore, the price predictions are off the chart.