Bitcoin as Alternative for the Traditional Currencies. Part 2: The Current Situation
Once again – bitcoin is too young, just several years old and still has not replaced all fiat currencies of the world to make some dramatic forecasts.
Once again – bitcoin is too young, just several years old and still has not replaced all fiat currencies of the world to make some dramatic forecasts. The volumes of mining and spending is very small comparing with the size the developers hold in mind introducing it to the world. The recent peaks in price could just have arisen because of the gained points on popularity and big noticeable deals in the community – just keep in mind the decision of the Chinese giant Baidu.
The situation does not only look like as if all the bitcoin community would be sure that the prices would keep going up. Naturally, about a half of all users might think the opposite – a growth cannot be forever, let us spend them, get rid of them, do not use them anymore. There are no negative trends in the spending of bitcoin statistics. The problem might appear by the year 2140. If by this year bitcoin or any other similar crypto currency will replace ordinary money and become a prevailing unit of account – that will be the problem. Now the prices for goods, for example a burger at a fast-food venue is calculated in dollars. How much resources were used to produce, the salary of the cook, waiter and maid is included, as well as taxes and other bills. This resulting sum is just converted to bitcoin. In hundred years the prices might be calculated in bitcoin, so fluctuations and growth will prevent from correct evaluation of a price for a good.
Still again voices of economists arise to say that this is normal, it is OK. Such a currency with a high deflation level would be great to refresh economy. It is decentralized and it has a limit. But who says that? It is open source software; many activists have developed it to the current level after Satoshi. Any time the rules can be changed, by a new ambitious developer, economist or just a plain IT freak. Government mint more money, nothing can prevent bitcoin from going this way. In some cases skeptics see, that someone might use the code and protocol to create a different crypto currency and afterwards we might forget about bitcoin.
Knowing that the miners are the ones who divide among each other minted BTC will be glad to continue. Living from fees from transactions sure is not that much as continuing the production routine.
Do not be afraid – now no one can guess what will happen with it in time. Experts might believe different things, can prove them, but there is always plays of an incident that might change the basic of this matter. Try to use the current situation for Your success. Be ready not only to gain, but also to lose. The main idea behind it is that things created by humans still depend on them. Digital currencies, as well as bitcoin, will be what we want them to be. Much is still up to us.