To get a good idea of what’s in store for the future of Bitcoin, it is important to have a look at its past. According to experts, Bitcoin has managed to maintain a stellar performance considering it was only created just over a decade ago. So, what has happened over these 12 odd years of Bitcoin’s existence? Let’s have a look.
Bitcoin Being Used as a Cushion Against Inflation
Many institutional investors in Bitcoin have already seen it as a hedge against inflation. This is mainly because, according to Bitcoin’s creator, only 21 million bitcoins can be created. This gives the digital currency a definitive edge against traditional currency, regulated by the central bank that decides on printing new bills based on votes from a committee. This is the reason why its value will continue to rise. In fact, according to JPMorgan Chase analysts, Bitcoin could reach a value of $146,000 in the not so distant future. Others such as Morgan Stanley have also predicted a bullish future for the cryptocurrency.
The Decline of the US Dollar in Foreign Markets
Another reason why Bitcoin is likely to continue its upward trajectory in the future is because of the decline of the US dollar in the foreign exchange markets. Since foreign exchange markets have always been used as an indicator of the US dollar’s value, it’s a good indicator of what to expect in the future. Right now, the US dollar has dropped by nearly 7% against the Japanese Yen and Euro. This decline has been the result of the Federal Reserve printing more than $3 trillion of money just this past year, more than it has printed in over 108 years.
More Retail Spending
It is no secret that purchasing Bitcoin has gotten much easier compared to a few years ago. Just last year, PayPal, a leading online transaction and payment service, started allowing payments in Bitcoin, which only goes to show that there’s a growing acceptance for Bitcoin, which was not the case previously. A good stat to consider is that according to reports, there has been a spike in Bitcoin purchases that amount to $600 over the past few months, which happens to be the same amount as the stimulus checks that many Americans have been receiving during the pandemic.
With the new government having already taken office, we can expect to see more stimulus bills being passed by the government, and not all of them may be financed via additional money being printed by the Federal Reserve. While there is no crash in sight for Bitcoin investors, it is still important to note that since 2013, there has not been a single year where the value of Bitcoin hasn’t dropped by at least 25% despite breaking previous price records. According to experts, while this volatility is likely to continue in the Bitcoin space, many are still bullish on the future of Bitcoin, with some estimating that its value could reach $80,000 over the next three years. So, if you’re a bitcoin investor or thinking about investing in cryptocurrency, you are in good company. If you are looking to get the latest news and happenings on Bitcoin, then kafila.org is your one-stop-shop for all things Bitcoin related.
