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Ever since Bitcoin reached $20,000 in 2017, cryptocurrency has been sort of a hot topic. Yet, it’s not all just an overnight success story that happened to a small few, as the media propagates. The fact of the matter is — cryptocurrency is still in its infancy; Bitcoin has yet to reach its 21 million cap!
But, don’t just take my word for it. Read the 5 reasons listed down below and see for yourself!
1. An Increase in Cryptocurrency Regulations
In the past, one of the major issues of digital currencies was their complete lack of regulation. This acted as a deterrent for many an investor that would have otherwise placed their capital in this trade.
However, this is no longer the case as new security laws show promise of a budding ecosystem that will be both safe and secure from various scams and online frauds. For instance, the U.S. Securities and Exchange Commission set its gaze on initial coin offerings (ICOs) and token sales whilst countries like Canada and Australia have enacted laws that increase crypto security checks. Moreover, there are countries like Spain and Luxemburg that are drafting new crypto-friendly regulations to attract investors and countries such as Lithuania and Venezuela that are building their own cryptocurrency systems.
All in all, these regulations will lower the level of uncertainty that usually comes with the use of cryptocurrency which will provide a nice boost to the whole crypto economy in the process.
2. Growing Alternatives
When we speak of digital currencies, the first thing that comes to peoples’ mind is Bitcoin. Yet, this is but one of many cryptocurrencies that exist today. Currently, there’s more than 2000 of them on the market (and rising) which implies there’s a growing demand for them still. It shouldn’t come as a surprise then that organizations, such as the IMF and the World Bank, are launching their own brand of cryptocurrency — the “Learning Coin” — to help them get a better understanding of distributed ledger technology. Additionally, JP Morgan will be the first international bank to launch its own fully-fledged cryptocurrency — the JPM coin.
Now, if that wasn’t enough, ICOs have attracted the attention of a plethora of investors all across the globe. In 2017, companies raised around $5.5 billion in cryptocurrency-based funding and hit the $6.3 billion mark at the start of 2018. Talk about investments!
3. The Rise of Blockchain
Blockchain technology has been at the centre of media attention for quite some time now; and with good reason! It’s transparent and efficient structure offers many unique opportunities for a wide variety of organizations including Intel, Microsoft, JPMorgan, and even Facebook, which have all invested large sums of money in research of this technology. Now, if these corporate giants are so ready to splash the cash, they must be onto something, right?
In essence, what makes blockchain so alluring is its decentralized ledger. Basically, how it all works: people with specialized cryptocurrency mining tools allow complex algorithms to harness the power of their computers to keep the ledger “alive” on the blockchain in exchange for a few “coins” as a reward. The ledger is then stored on an array of computer networks referred to as “nodes” which check each transaction to make sure that it is valid.
The potential applications of this innovative technology are obvious, as is the continued faith of various “megacorps” in their attempts to harness its power. This brings renewed enthusiasm not just for bitcoin but for the whole cryptocurrency market in general.
4. Ease of Investment
One of the reasons cryptocurrency trading has become so popular is due to its simplicity. Today, anyone can invest in cryptocurrencies with a mere press of a button. All you need is a digital wallet and a bank account and you’re good to go. What’s more, there are countless guides and tutorials all over the Internet, especially YouTube, which go into great detail about how this exchange is conducted; it’s no longer considered a phenomenon like it used it be back in 2008. Some cryptocurrency wallets even come with their own built-in cryptocurrency exchange feature.
In addition, you pay no processing fees for your transactions, making it cheaper than any other form of exchange; banks usually charge around $20–$30 per transaction which is pure robbery.
5. A Rise in User Count
As the year 2019 goes by, the number of blockchain wallets continues to mount. According to Statista, the number of eWallet users has now reached 40 million. Even though Bitcoin has plummeted in December 2017, people know that cryptocurrency (as an asset) is a long-term investment. It takes some 5 to 10 years to sit on (or more) as was the case with Bitcoin where it provided once in a lifetime trade opportunities.
Cryptocurrency is no longer regarded as some exotic goods made only for cyberpunks and hackers. Instead, the general public is well-aware of its presence. That’s why, in 2018, there were around 650,000 active Bitcoin addresses on the blockchain, 350,000 Ethereum addresses, 100,000 Dogecoin, etc. Although these figures concerning individual cryptocurrency can somewhat drop in the following years, it’s mainly due to the rise of new altcoins rather than the waning interest in cryptocurrency as a whole.
It will take some time before the market fully stabilizes and matures. Until then, we need to be patient and keep a close eye for new regulation, blockchain developments, and growing altcoins.