Bitcoin and its future potential

Bitcoin and its future potential

One of the biggest regrets many tech-heads have at the close of 2017 is why oh why, didn't I save those Bitcoin I once had? People have dug through landfills, cursed the sky and lamented the time they spent that one Bitcoin that cost them $50 on something wasteful. Why? Because today a single Bitcoin is worth more than $15,000 and many seem to believe that before long we'll be looking at six or even seven digit valuations for the cryptocurrency.

For the uninitiated, Bitcoin began its life as a humble idea of fast and convenient transactions of monetary value back in 2009, when its creator, the pseudonymous Satoshi Nakamoto, mined the first few Bitcoins from the very first block. Back then, the currency was worth cents and early miners would be billionaires today if they'd held on to the thousands of coins they mined and transacted with one another.

Over the years Bitcoin found acceptance as a currency in various ways, from buying drugs on the Darknet to gifting to charity, and that usage meant it increased in value. It wasn't until 2013 though that it started to really see an uptick. For a short while it hit $200, which was an amazing feat for something entirely virtual. It quickly crashed though, leaving many believing its time as a store of value had come and gone.

Not so, as at the close of that very same year Bitcoin soared on a new wave of investment excitement to more than $1,000 – Bitcoin's time had come. Or so it seemed, as once again that hype bubble burst and it went crashing back down to just a few hundred dollars and there it stayed, for years. Although there was a steady uptick throughout 2015 and 2016, it was only in 2017 where things really started to get interesting.

Throughout the year Bitcoin continued to grow in value, from a thousand dollars to more than three thousand and in the past few weeks it's gone from being worth a handful of thousand, to close to $20,000. While it appears to be taking a slight dip at the time of writing, that's expected to be only temporary.

Big names like John McAffee have now proclaimed that by the end of 2020 we could see a single Bitcoin be worth as much as a million dollars. That means even if you invested today you'd stand to make a sizeable profit.

Of course no one can accurately predict the future of the cryptocurrency. Government regulation in countries like China has traditionally wobbled the volatile currency, sending it crashing or soaring depending on factors that none of us have control over.

Indeed governments could announce tomorrow that they have banned the trading of the currency altogether and it would no doubt cause the currency to crash. But it probably wouldn't cause it to die off altogether, because the very nature of Bitcoin is that it's decentralized. It doesn't need a middleman. You can send Bitcoin to anyone with a wallet without asking anyone else's permission and as long as you pay the relatively small fee, it will get there in a timely manner.

The fact that organized crime has taken such an interest in Bitcoin for money laundering purposes should tell you just how viable it is as future transactional and value storing medium. All you have to do is send your coins through a self-described "tumbler" which jumbles your coins with someone else's, spitting them out the other side in an untraceable fashion.

Of course much like typical money laundering schemes, the platform itself is susceptible to law enforcement oversight and Megagames would never condone mixing with the kind of people who can benefit from such schemes – but the writing is on the wall: Bitcoin is not going to be stopped. Its value might be far from certain, but it will always remain operational unless a dangerous flaw is found in its core function.

But even then, updates are being made to the platform all the time. Many developers are working on security updates and tweaks to make it better, to help Bitcoin compete with some of the many hundreds of cryptocurrencies now in operation.

In short, although there is growing competition, Bitcoin seems poised to be a major influencer on the future of finance in all sorts of sectors, and though we can't guarantee it will retain the kind of value that some predict, it will certainly be used for all manner of things in the future, whether we make money on it or not.

Image source: Jason Benjamin/Flickr