2017 was clearly the year of Bitcoin – and that of the blockchain. It was the year when the media, as well as regulators, started to take it seriously. Besides, it was also the year when it reached its highest exchange rate so far. If in 2016, its price didn’t even reach $1000, by the end of 2017, it reached its all-time high of 19,783.21, stopping just a bit short of the $20k psychological barrier. Since then, it had its ups and downs (mostly downs), its exchange rate decreasing to under $4k, and staying there for the time being. This means that in three years, bitcoins have gone from “zero to hero”, showing not only a spectacular growth but also a massive increase in relevance, apparently stabilizing after a “bubble”. But you also have to consider that bitcoin is not like the traditional investment, where a long good track record shows how it is much stable, but in the case of bitcoin, it’s uncertain and the exchange currency changes more than you expected it.
There is a lot of speculation going on about what to expect from bitcoin – and other cryptocurrencies – in the coming years. Will bitcoin rule in a decade or will it even be still a thing?
In the short term, analysts are bearish when it comes to bitcoin, expecting its exchange rate to decrease to $3,000 or even less this year. Then again, there are other experts claiming that bitcoin might grow to $15,000 or even $20,000 by the end of the year. When it comes to the long term, though, it’s not only the enthusiasts and the investors that are bullish about it – it’s the experts, too, firmly believing in the future of cryptocurrency as a whole. The idea of an internet-native digital currency (some call it digital gold) has so much potential, that many experts find it plausible for it to have a price far exceeding physical gold, perhaps even growing as high as $250,000 or even more. Some even expect it to become the “gold standard”.
“If bitcoin’s economic incentive system continues to work and survive the way it has over the past ten years, it doesn’t matter what mainstream financial institutions think – it doesn’t matter what anyone thinks – it is just going to be an economic reality that compels people to act upon it,” bitcoin economist Dr. Saifedean Ammous Professor of Economics at the Lebanese American University, and member of the Center on Capitalism and Society at Columbia University thinks.
Apparently, it’s hard to predict how the price of bitcoins will evolve, even in the short term. Predictions have repeatedly been wrong over the last few years. Predictions about its exchange rate have repeatedly been too optimistic and too pessimistic. It’s uncertainty and lack of guaranteed value means it carries a lot of risks. Some of the risks associated with bitcoin are Regulatory risks, Security Risks, Insurance, Fraud, Market, and Tax Risks. So, let’s just stick to the one thing that is certain about cryptocurrency – and the blockchain – for now: it’s here to stay.
