Does Bitcoin have a future?
Bitcoin has been the king of cryptocurrencies for many years. Because of its price, what it represents, and the economic situation. The main question we ask ourselves is: what is its future?
What lies ahead of the crypto king
The future of the BTC is not easy to imagine, and to be sure of the conclusions. There is no doubt that it has incredible potential and several risks that need to be considered.
For this reason, let’s analyze the scenarios that may occur in the future of the cryptocurrency king. Any of them can happen in the near future. And so, let’s look at Bitcoin in the future as:
- World currency
For the crypto community, the most optimistic scenario of all is that the Bitcoin will become a global reference currency in the future. In this case, it will replace the US dollar as the main currency in which citizens, companies, and governments conduct most of their transactions.
This does not mean that other currencies will necessarily disappear. They can co-exist. But the money that has the dominant power will be the BTC, so that the issuers of the major currencies, especially the US and the euro zone, will lose the opportunity to increase their money supply.
As a global currency, this will entail significant social, economic, and geopolitical changes. It would make the world a much fairer place. The era of large government deficits and debt would have come to an end. When it came to international trade, all countries would be the same.
- A store of value
Another option for Bitcoin is to use it as a store of value. In this scenario, people will continue to operate mainly in euros, dollars, rubles, pounds, or yen.
Governments and central banks will retain their right to increase the money supply as they see fit, which means that government deficits will continue. And inflation would continue to reduce the cost of savings and wages of the population.
However, people will be able to invest their money in BTC to protect themselves from currency devaluation. In this second scenario, it will play a role similar to today’s gold. It is a diversifying reserve asset that is able to maintain its long-term value.
- Replaced with another cryptocurrency
What if another cryptocurrency replaces Bitcoin as the reference cryptocurrency. Historically, the BTC has accounted for 60 to 80% of the total capitalization of all cryptocurrencies. It is far ahead of Ethereum and is many light-years away from the rest.
If it is replaced by another cryptocurrency in the future, there is no doubt that it would probably improve some aspects of the flagship crypto market. And Bitcoin will continue to exist, but will fade into the background.
- as a consequence, thre is no need for BTC
Gold is likely to retain its current role. In fact, in such a scenario, there will be room for two assets. If we look at the historical data, we can see that the share of gold in investors ‘ portfolios today is much smaller than it was many decades ago. The likely monetary problems of the future tell us that there is a place for both gold and Cue Ball in the future.
This option may sound like science fiction, but it’s not. Bitcoin was born out of the need to have a fair currency. It must meet the interests of the country or the government. In other words, be a currency that will serve its users.
The reason why people have always turned to gold is that the value of fiat currencies always ends up being zero in the end.
But that doesn’t mean it should happen in the short term. The fiat currency can perfectly fulfill its role for many decades. And while things are going well, almost no one thinks that it would be better to invest their savings in gold than in paper money.
While it seems impossible that governments and monetary authorities of countries can change their current policies, the truth is that anything is possible in the long run. Therefore, we should not completely rule out such a scenario.
- Complete ban
Finally, the fifth scenario of the future is the most negative for both the cryptocurrency and the whole world. We are talking about the fact that almost all governments prohibit the use or possession of Bitcoins and begin to persecute the owners of the cryptocurrency. If the government declares bans and imprisonment as a punishment for violating it, then people and businesses will comply.
Calculating the future fate of Bitcoin is a very difficult task. One might even say that this is impossible. The socio-economic situation is constantly changing under the influence of many factors. We can try to predict the price of an asset in each of the six future scenarios just discussed, and then calculate the probability for each of them, but this only sounds simple. In fact, this is not the case.