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The Future of Bitcoin

bitcoin image

Bitcoin is eight years younger than the Euro- and in the world of cryptocurrencies, this means it is an old and established coin. But as the bellwether of cryptocurrencies gains popularity, so pressures are increasing.

One of the biggest problems facing Bitcoin is the splitting of the blockchain. This has happened once in August 2017, creating Bitcoin Cash. And another split is planned for the end of October, to create a network with a coin called Bitcoin Gold. And then another network may split off in November.

There is no consensus on which of this networks would be counted as “the real Bitcoin”, but it is a tug of war, a fight for influence among large mining groups and developers. Since Bitcoin is decentralized, there is no easy way to achieve consensus on which version of the code to run and which features would be prioritized before others.

The other threat before Bitcoin is regulation. As adoption increases, so do the worries of governments and central banks. There were recent talks of restricting mining in China, though this turned out to be just a rumor.

Then there is the issue with the market price of Bitcoin. It has gone through peaks and troughs- and as interest rises, the battle to own some of the 21 million Bitcoin may become so heated that one Bitcoin could command a market price of 100,000, even a million dollars, as some experts predict. But the price could also go down to zero if users lose confidence. The other problem is that with a high price, transaction fees are also rising, making it impossible to use Bitcoin as a means of payment. Instead, Bitcoin may turn into a settlement platform to lock in the gains of other cryptocurrencies.

Bitcoin also faces the challenge to clear its image from connections with drug dealers and criminals. The Silk Road debacle is far behind, and yet Bitcoin still faces a stigma. Some communities are clearing its image, and some governments are more friendly to Bitcoin than others- Australia and Japan for instance.

Lastly, Bitcoin is constantly challenged by altcoins offering more features, speedier networks and also wide dedicated bases of fans, users, investors and developers. It is possible that one of those coins becomes a truly popular, everyday means of payment.