Everyone has heard of Bitcoin by now. But, nobody is sure of what it is and how it works. When you talk about Bitcoin, you are talking about is a digital value. In other words, it is digital cash. This digital cash is not tied to a bank or regulated by the government and lets users spend money anonymously.
The digital currency has taken the world by storm, particularly in the last few months. On account of owning around a million Bitcoins, the inventor of the crypto has reportedly become the 44th wealthiest person in the world. Many others have made good fortunes from the ballistic Bitcoin.
However, speculations around the digital currency have mirrored its value. It has been called “bubble” many a time. Is it one?
The astronomic rise in the value of Bitcoin has surprised one and all. From less than a $1000 per coin at the start of the year, it almost touched $20,000 a few days back. The price of one Bitcoin surged as high as $19,535 – an equivalent of 12 lakh INR. In December month alone, the digital currency’s value has appreciated 10x. You never know the frenzy might start again.
Since reaching the record high of nearly $20,000 on December 16, Bitcoin has tumbled losing almost the quarter of its value. According to CoinDesk’s Bitcoin Price Index (BPI), the Bitcoin value fell as low as $13,528 before picking up again.
It made people wary, to believe crypto currencies are not a reliable way of storing value. With its price going down as much as 25 percent in a week, can it be considered a key function of money?
One Bitcoin is currently trading around $15,000, according to the Coinmarketcap website. However, the value of Bitcoin is highly volatile to swing either way. According to the coinmarketcap.com website, the digital currency contributes 44.3% to the $583 billion crypto market.
By all the measures, the crypto has not reached the point, not yet, where it can be considered a medium of exchange, like cash, to facilitate transactions.
The big question remains – Is it a bubble about to pop or will it be the face of future transactions?