Bitcoin: New Gold or Fiction
More and more people around the world are purchasing bitcoin with the hope to see it’s excess profit.
The increasing value of asset has attracted many hackers who break the system and steal bitcoins from digital wallets. An incident happened a few days ago. Slovenia-based company called NiceHash was broken into and bitcoins were stolen, worth more than $70 million. This theft has been considered as the biggest fraud in Slovenian history. NiceHash is the largest marketplace for mining digital currencies. Mining currencies means to get bitcoins by solving transaction-related algorithms.
In 2010, a Bitcoin was Worth Only a Few Cents …
When bitcoin program was first launched in 2009 by a mysterious man from Japan, Satoshi Nakamoto, it was practically worthless. Then its price has multiplied and last November it reached the average price of more than $700.
During this Year its Value Increased to Around $20,000.
The value of bitcoins escalated enormously last autumn. Recently it passed the magic level of $10,000 and broke $17,000 mark a few days ago.
Some people took risks and bought the virtual money for a few cents in 2010 or a few dollars in 2011 and sold them at their highest price. Now they have become millionaires by a rapid increase. Even those who bought Nakamoto’s coins last year and sold them a year later have increased their initial fortune tenfold.
Is this the Currency of the Future?
Investors have different attitude towards bitcoins and other crypto currencies. Some enthusiasts believe that Bitcoin is the currency of the future which will push aside traditional currencies, and do away with banknotes.
The reason why many people are thrilled with bitcoins and other crypto currencies is that traditional banking becomes unnecessary.
On the other hand, crypto-opponents claim that Bitcoin is merely a hoax and should be prohibited. Time will tell, of course, but we can safely say that bitcoins and other crypto currencies are still far from pushing aside “real” money.
Digital Gold? Well, More Like Digital Speculative Investments …
There is a problem if bitcoin can be considered as a new form of gold for the younger generation. May be it can. Buying gold is still a long-term investment, but the same thing we can’t say about bitcoins, because of high volatility and uncertain future.
At current moment, bitcoins are mainly a speculative investment for those people who want to become rich overnight. They want to buy bitcoins, hoping that their price will soar, and sell them for large amounts of money.