Will Bitcoin Continue to Rise and Inevitably Fall?

IT.com

JulienJ

Member
Bitcoin, like fiat currency, at its core is a concept. If enough people buy into the concept, then it has value. What I was commenting in my previous article is not whether you should buy or not but whether the Bitcoin was going to go up. All the indicators from volume of transactions (both monetarily and value) are still rapidly going heading north which suggests a growing demand for essentially a dwindling supply.

The reduction is supply is largely due to people holding their coins in the belief the price will continue to rise. Why sell today when you can sell tomorrow for $1,000 more.

Until the "currency" stabalises the dream of Bitcoin being used to buy a cup of coffee will remain just that, a dream. The wild hourly swings mean Bitcoin is largely driven by speculation.....the question is when will the speculation tap out…..as it must.

Of recent days, the traditional media has massively escalated their interest in Bitcoin (and crypto-currencies in general) and this has helped stoked the fires of demand with fresh largely uninformed speculators. It also didn't help that a number of major institutions got onboard as well....!

The flood of money into Bitcoin combined with the reducing supply pushes the value upwards.....welcome to the exciting world of the seventeen hundreds tulip bubble.

There will be a correction with Bitcoin (or even a crash) the challenge is to work out when this will occur. It could be caused by the technology reaching a critical point as transactions take longer to complete but there is one thing for sure, as long as there is greed then people will continue to roll the dice.

The comments in my previous article relate to the massive increase in Bitcoin demand.....not whether Bitcoin is worth buying into. I personally have exited most of my crypto-currencies OUT of Bitcoin as I don't see an underlying business model that doesn't smack more like a casino. If Bitcoin stabilizes and becomes usable as a means of transacting, then this business model may cause me to reevaluate my position.

I believe the rise of Bitcoin (separate to blockchain) is a symptom of a number of things:

  1. The 2008 Global financial crisis and the lack of faith this sparked in financial institutions.
  2. The desire to conduct commerce directly between parties without an intermediary that many people are viewing charges fees not in proportion to their value added.
  3. True anonymity in financial transactions - this is good and bad.
  4. Speed of transactions versus the current slow systems.
  5. Greed….people will always have a dream of making quick money.
Source
 

whois



Forums dedicated to Indian domain names, including buying, selling, appraising, developing, and monetizing.

About Us

Threads
29,400
Messages
76,809
Members
7,957
Latest member
sametbtr
Top Bottom