In 2011, the value of Bitcoin was less than two dollars. In the last six years, its value increased by over 4000%. Jordan Hiscott says this rapid growth is a sign of the shifting paradigms in the world of finance. According to Hiscott, “we are in an age where technology is changing the dynamic of the business world.”
So, what is behind bitcoin’s upward trajectory?
One factor could be the lack of regulation and control from the big banks. Bitcoin works with a decentralized exchange, so all transactions are peer to peer. Bitcoin also uses dual-sided cryptography for each transaction, so it is very secure.
Numerous countries support the cryptocurrency. Japan recently recognized Bitcoin as a legal method of payment. Russia, formerly against cryptocurrencies, recently changed their stance. To combat money laundering, Russian authorities will look to legalize bitcoin and other cryptocurrencies as financial instruments in 2018. Russian Deputy Finance Minister Alexey Moiseev said, “The state needs to know who, at every moment of time, stands on both sides of the financial chain. If there’s a transaction, the people who facilitate it should understand from who they bought and to whom they were selling, just like with bank operations.”
The accessibility of Bitcoin is another factor to its rising popularity. As mentioned earlier, Bitcoin works as a peer to peer currency system. Resources like Coinbase.com allow for buying and storing the cryptocurrency to be more accessible to the public. Coinbase.com acts as a one-stop shop for popular cryptocurrencies like Bitcoin, Etherum & Litecoin.
Another major reason for Bitcoin’s success especially this year might be due to the success of the beta test of Lightning Network. Lightning Network is an overlay network built on top of the Bitcoin Blockchain. It works as a decentralized network that uses smart contract functionality in the Blockchain to allow instant payments across a network of participants. This new form of paying with Bitcoin helps to move some transactions away from the main Blockchain. The Lightning Network also allows buyers and sellers to work privately and broadcast the activity on the public network later.
This year alone, Bitcoin’s rise was groundbreaking. At that start of 2017, the value of Bitcoin was $900. This number rose to $6,300 by October. Recently, Bitcoin’s value is now at over $17,000. The future is definitely bright for the cryptocurrency. Experts predict its value will reach over $33,000 by the end of 2018. Chris Kline, co-founder, and COO of Bitcoin IRA predicted that it will be the best high-growth investment of 2018.