“Bitcoin seems to be a very promising idea. I like the idea of basing security on the assumption that the CPU power of honest participants outweighs that of the attacker. It is a very modern notion that exploits the power of the long tail.”
The Bitcoin Price History: An illustration indicative of the future of the digital currency industry
The opening statement: “The cryptocurrency sector… [will]… mature into a viable alternative payment option” can be substantiated by looking at Bitcoin’s price history. At this juncture, it is also essential to be cognisant of the fact that while we are talking about the Bitcoin price, it is illustrative of the digital currency industry as a whole.
Additionally, it is interesting to note that the Bitcoin’s overall historical price movement shows a cyclical picture. Moreover, if we look at the early price movements, there has been more than one opportunity for it to fade away. However, every time it hits a low point, the price turns around and starts climbing again.
From Bitcoin’s inception (January 2009) to circa March 2010, Bitcoin was not worth anything. It’s first minuscule price movement began in March 2010 at $0.003 and rose to circa $0.08 by July 2010. Between February 2011 and April 2011, the Bitcoin price was linked to the USD price; thereby, making it much easier to keep track of its price movements. The rate rose from $1 to $31 on 8 July 2011 and dropped back down to $2 by the end of 2011. It then took a year to rise to $13 (in 2012).
On 11 April 2013, the coin’s price was listed at $266: the sharpest price increase in the Bitcoin lifecycle. This price then dropped to $70 by June 2013. The price then turned and climbed to $1242 in November 2013. The price crashed to circa $500 by December 2013. The price turned and topped out at $1000 in January 2014. It dropped to $340 in April 2014. And, once again started climbing and reached $630 in May 2014.
After this, the price plummeted to $200 by March 2015. Then the price levels hovered around $200 to $300 for most of 2015. It started climbing in November 2015 and reached a high of $504.
The Bitcoin price lingered between $450 and $750 until January 2017. The last significant spike occurred in 2017 where the price rushed to $17900 on 15 December 2017. Currently, the coin’s rate has fallen again and is sitting around $6000 for one Bitcoin.
The cryptocurrency sector and the future
Jones Mutual, a leading cryptocurrency and CFD trading brokerage firm, believes that the cyclical nature of the Bitcoin price history shows that it is not it is not worth spending any time pondering the future existence of the cryptocurrency industry. However, it is worth looking at what the future holds. Here are a few ideas that are worth considering:
Cryptocurrency’s price volatility
It is reasonable to assume that the current price volatility across all cryptocurrencies (both old and new) will continue for a while longer. It is impossible to predict how much longer. The prices should stabilise when the digital currency sector has reached mainstream adoption. But, this seems to be several years away. However, when trading cryptocurrency CFDs, price volatility is a good thing.
Invest in ICOs
Benjamin Sherry of Investopedia.com notes that a good way to get into the cryptocurrency industry is to invest in an Initial Coin Offering (ICO). They are the latest way to raise investor capital to kickstart new projects and companies. Essential, an investor invests funds and receives a certain number of virtual coins in return.
It is important to note, however, that investing in ICOs is very risky and investors should only risk funds that they can afford to lose. On the other hand, ICOs are an excellent way to get involved in a cause that the investor is passionate about and has the potential to get off the ground; thereby, increasing the value of the investor’s coins exponentially.
A big part of the cryptocurrency industry’s price volatility is because the sector’s future is unknown. Pundit’s and crypto-experts can predict what the future might be. However, until it happens, there is no knowing what the future holds. This fact is both the attraction to and the risk of, investing in cryptocurrencies.