Bitcoin Is (Almost) Dead: Why You Should Feel Good About It

Yes, we said it: Bitcoin is (almost) dead.

After prices coming close to $20,000 before Christmas, the cryptocurrency has crashed into 2018 with prices dropping below $6,000 earlier this month – not great news for everyone invested in Bitcoin, but it is for anyone looking to get into the game now.

Sorry, what’s that? Are you trying to tell us Bitcoin’s demise is a good thing?

Correct. According to 99bitcoins.com, this is the 253rd time the world’s favourite cryptocurrency has perished (as of February 2018).

We’re not sure how credible that figure is, but we do know Bitcoin has bounced back from its deathbed every time another obituary gets written – and it comes back stronger than ever.

Looking at Bitcoin prices right now, it’s worth ten times what it was this time last year. Yep, Bitcoin is (almost) dead and here’s why you should feel good about it.

Bandwagon Investors Are Pulling Out

China banned cryptocurrency exchanges

The Bitcoin discussion was largely divided in 2017. One camp said things could only keep going up while the other insisted the “Bitcoin bubble” was about to burst at any moment.

What’s actually happening is something between the two: a market correction after artificial inflation due to the excessive hype surrounding Bitcoin investment.

With thousands of would-be investors jumping on the Bitcoin bandwagon, inflation was the only possible outcome. Each new landmark in Bitcoin value wrote more headlines, prompting even more people to jump on board and hike up the going rate even more.

The problem is, many of these “investors” are only getting involved because there’s quick, any sudden drop in value quickly rocks easy money and their faith in the technology. This is why Bitcoin has become so volatile.

These buyers can cause more harm than good, artificially pushing up the price of cryptocurrencies and panic selling as soon as there’s a price drop or a negative story in the news.

In many cases, these aren’t people who have watched Bitcoin grow for almost a decade and see value in it beyond the going market rate.

To new buyers, a price drop of $1,000 in one day can seem disastrous.

To long-term holders of Bitcoin, a market correction is the best thing that could happen to the cryptocurrency at this time.

Now people will start to see that cryptocurrencies are here to stay, as a long-term investment, rather than some insider bet.

Bitcoin Prices Are Stabilising

For those of you who only started paying attention to Bitcoin last year, the notion that it should be worth $15,000-$20,000 might seem reasonable.

But those of us who have been in this game since the early days remember how big a deal it was when Bitcoin matched the value of 1USD in 2011. Let’s not forget how significant that is.

Bitcoin has been around since 2009 and, besides briefly breaking the $1,000 value mark in December 2013, the cryptocurrency spent the first six years of its life significantly under the $1k region.

For a digital currency that can barely even be used in store to buy anything to be valued anywhere near $1,000 is pretty incredible.

Now we’re looking at prices around the $10,000 region with signs that the market could already be stabilising after the early 2018 crash.

The lowest it has dropped during this decline was just under $6,000 on February 6, which put it back on par with Bitcoin prices before the mad rush began in November last year.

Last year’s Bitcoin boom and the bust in 2018 only distract from the bigger picture with cryptocurrencies.

Despite governments, banks and other financial institutions piling every bit of pressure they can against cryptocurrencies, prices are now settling at an impressive return from this time last year.

Last Year Wasn’t Only a Bitcoin Boom

Bitcoin boom

One of the most important side-effects of last year’s Bitcoin boom was the impact it had on other cryptocurrencies.

In fact, Bitcoin’s growth rate last year was dwarfed by more than a dozen altcoins, which transformed the industry from a one-horse race into something far more diverse and robust.

Ripple, Dash Ethereum and Litecoin are among the other most prominent names in cryptocurrencies right now, and they all bring something different to the table.

For example, Ethereum is designed to create smart contracts for businesses negotiations while Ripple positions itself as a payment network for financial institutions to transfer payments overseas.

Meanwhile, Bitcoin was designed purely as a digital currency.

The point is, different cryptocurrencies have different things to offer, and investors don’t necessarily back a particular currency because they think its value will increase the most.

Many of us invest in cryptocurrencies based on the technology behind them and its application.

With Ripple, for example, you’ve got the market value of its coins to consider but also the fact it provides a single platform to send payments in real-time for much less than any other platform.

Cryptocurrencies Are Standing Up To The Pressure

Blockchain was created under the premise that governments and financial institutions can’t be trusted. That there should be some decentralised alternative that can’t be corrupted or manipulated.

Funnily enough, the technology was created roughly a year after banks brought the global economy to a halt and governments decided taxpayers should cough up to pay for their corrupt expenses.

Now, the same financial experts that failed to predict (caused) the 2008 global recession are the loudest voices screaming out against blockchain technology.

You know, like Jamie Dimon of the famously-corrupt JP Morgan calling Bitcoin a fraud last year while the company was busy buying up the cryptocurrency.

“It’s a fraud. It’s making stupid people, such as my daughter, feel like they’re geniuses. It’s going to get somebody killed. I’ll fire anyone who touches it.”

– Jamie Dimon

This isn’t the first time Bitcoin has had to stand up to resistance from financial powers, though.

In December 2013, the Chinese government banned financial institutions from using the cryptocurrency, and several Chinese Bitcoin exchanges had their bank accounts shut down in April 2014.

The clampdown caused a downturn in Bitcoin value, putting a stop to significant growth for some years.

Meanwhile, the US has been working hard to regulate the use of cryptocurrencies for many years. Various countries have already restricted or banned Bitcoin to some extent, and each new announcement dents the currency’s value – at least temporarily.

The common argument is that cryptocurrencies are used by criminals and pose a risk to investors, unlike the money banks use to fund wars and crash economies, of course.

Either way, cryptocurrencies are standing up to governments and global financial institutions.

Bitcoin’s value has massively increased since 2009, and more people are buying into cryptocurrencies as they realise there’s an alternative to centralised financing.

Cryptocurrencies Are Proving Their Worth In 2018cryptocurrencies are recovering

Last year’s Bitcoin boom did wonders for the wider cryptocurrency industry, but it also generated a lot of hype and misinformation.

An early crash in 2018 has killed a lot of this hyperbole, and we’re now left with a bunch of much stronger coins that can prove their real worth this year.

As we said earlier, cryptocurrencies like Bitcoin and Ripple bring different kinds of innovation to the finance industry.

These aren’t merely digital currencies; they’re solutions to genuine problems that banks and other institutions have either failed to address or specifically created.

Ripple uses XRP currency to instantly send finances to anywhere in the world, at a fraction of the price currently possible. It’s faster, more secure and it protects parties from the risk of unaffiliated banks closing. The thing is Ripple works with banks, mainly using the same SWIFT method of payments.

More than 100 banks are already signed up to Ripple, including ATB Financial, Santander, BMO Financial Group and Standard Chartered.

Ripple is changing the way banking works form the inside out by making it cheaper and faster for them to send and receive money.

Etheruem isn’t just a cryptocurrency; it’s a blockchain platform that allows parties to create smart contracts where terms, conditions and financial obligations are coded in the contract itself.

There’s no outside interference and contracts can be developed without third-party coders. The result is contracts that are more secure, easier to enforce and make it difficult for acting parties to commit fraud.

There are various other ways you can use Ethereum, too.

Obviously, there’s the cryptocurrency element, but you can also use it to raise funds for business ventures (without the usual Kickstarter costs) and use the community to source partners.

Storj is another cryptocurrency provider that aims to decentralise cloud storage. The blockchain-powered platform allows people to make money by renting out hard drive space, which could take the monopolisation of data storage away from the likes of IBM and HP.

Then you have Maidsafe, which wants to decentralise the entire web as we know it. Much like Storj, Maidsafe also allows you to rent out hard drive space but with the crucial difference that you can rent data connection to people.

This removes the need for Internet Service providers that dictate how much we pay to access and use the internet.

While cryptocurrencies have gained fame as digital currencies and investment opportunities, few people fully understand the kind of innovations that are taking place thanks to blockchain technology.

As we’ve said before, this is a technology that’s changing the way people vote, travel and protect themselves from fraud.

It’s changing the way governments, banks, hospitals and businesses operate. And it’s threatening to shake up monopolised industries like internet services, advertising, gambling and insurance.

This is the real value of cryptocurrencies and the blockchain technology that makes them possible.

Now that much of the hype around Bitcoin has died down, people will start to see this throughout the rest of 2018.

Here’s What You Need To Look Out For In 2018

Cryptocurrencies trending for 2018

Bitcoin and other cryptocurrencies have come out of the “crash” in a powerful position.

Bitcoin prices were around the $1,000 mark this time last year. Now they’re sitting around the $10,000 region.

However, the real success stories of 2017 were the dozens of altcoins that achieved insane growth rates, reinforcing the industry and strengthening its innovation.

The crucial next step for cryptocurrencies is to make themselves more usable in a broader scale. Bitcoin remains little more than an investment opportunity as long as it can’t be used in stores or more widely online to buy things – and the same thing goes for other cryptocurrencies.

This is already starting to change, though, and it will be interesting to see how far adoption has spread by this time next year.

Every time Bitcoin or any other currency is accepted in a genuine transaction it’s real-world value increases as a tool that can be used to buy and sell.

The more this happens, the more prices will increase – but more stably and sustainably than we’ve seen over the past twelve months.

Don’t forget about the other cryptocurrencies, either, because this is where some of the most innovative uses of blockchain technology is emerging from.

Platforms that allow business to operate in new ways, change the power dynamics of major industries or solve smaller, everyday problems have far more to offer than the value of their coins.

Keep an eye out for new, emerging cryptocurrencies that make technological breakthroughs.

Something else we’ll see in 2018 is governments, financial institutions and the other crypto-critics make their move on the industry.

Ignore the warnings about investing in Bitcoin or the criminal use of cryptocurrencies; these guys want to corner this technology, regulate it and take their cut from everything.

The US, China, Japan, Canada, Venezuela, Estonia, Sweden and Uruguay are already known to be working on digital currencies and are trialling blockchain technology. It’s going to be a busy year for the cryptocurrency industry.

So is Bitcoin (almost) dead? Not at all. It’s just taking a breather.

Read more on the Bitcoin Price Prediction For 2018.

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Megan is a self-taught blockchain enthusiast. She enjoys combining finance with technology, from a less-techy perspective. BiteMyCoin is her most recent project underneath the umbrella of an international digital marketing agency ANCHOVY.