Despite being just a decade old, bitcoin is making serious grounds in the financial world. The digital asset’s ecosystem has crossed over $3 billion in daily transaction handling. This mammoth number shows how the digital asset has been making progress despite the criticism and immaturity it faces.
$BTC sees over $3 billion dollars in daily transactions.
— Dave Craige⚡️ (@davecraige) July 20, 2019
Bitcoin’s adoption across the globe has been hindered by a number of factors. Firstly, the official acceptance of bitcoin is relatively low. Since it is a technological innovation, there are not many concrete regulatory frameworks available regarding the workflow of this digital asset. Still, this space is harboring billions of dollars in itself.
In order to stop illegal activities and malicious factors to leverage from this space, governments remain skeptic of letting this burgeoning space free. In fact, the initial use-case of bitcoin was strongly driven by its usage in illegal activities such as money laundering and in illegal marketplaces such as the dark web. Due to the negative aspects, even U.S. president Donald Trump is “not a fan” of cryptocurrencies.
Secondly, the asset has largely stayed away from the reach of the poor, a faction that makes up the majority of the world population. Bitcoin emerged as an electronic peer-to-peer cash system but it has failed to become an easily usable global currency. Since there is no physical backing of the crypto, extreme fluctuation in bitcoin price based on speculation, makes it a lucrative asset for investors to gain a quick benefit.
Most people in the crypto space are here to utilize the price spikes of bitcoin. They are holding on, or HODLing, to their respective shares of bitcoin with hopes that its price will go up in the future, giving them profits in return since the asset is treated more as a store of value.
Thirdly, there aren’t many bitcoin-usage outlets available in the real world to treat this asset as a currency. Price volatility makes it a store of value more than a source of conducting payments. Besides, there are many technological bottlenecks associated with bitcoin as well.
Despite all the troubles, crossing the daily transaction handling mark of $3 billion signifies that the global bitcoin adoption is on the rise. Increased adoption also signifies that more people now value of the digital asset and it is likely to lead towards an increased price, based on the simple supply-and-demand principle.
It has just been over 10 years since bitcoin emerged. With such huge money floating around in this space without concrete regulatory clarity, the question arises whether it is a good sign for the financial world or a bad one. On one end, bitcoin provides an alternative to the banking system which is ridden with centralized policy-making having issues like inflation, debt-based working, etc.
Bitcoin also provides a network that is decentralized, immutable, transparent and trustless, transcending all borders across the globe being purely internet-based. Transactions are made instantly with nominal fees as compared to the slow and dreaded bank-to-bank transfers.
Over the past 10 years, the asset has made serious progress establishing its image as a store of value, or “the digital gold“. On the other end, it can be used by illegal entities and is burdened with problems like price manipulation by big whales, lack of regulation and erratic price movements.
Since banks have now got competition, it may force them to make their systems better and adopt the revolutionary technology lying underneath bitcoin, blockchain, in building an overall healthy financial ecosystem. It is also possible that over the next few years bitcoin might improve on both of its technological and legislative fronts, giving the world a better financial system.
This week in crypto:
1. Bitcoin defended by Congressmen
2. Bitcoin network settling $3B daily
3. Grin executed first hard fork
4. ZCash conducts”friendly fork”
5. Bitcoin now over 65% dominance
6. Bitcoin still not dead 🙂
Another week of progress towards the ultimate goal ?
— Pomp ? (@APompliano) July 20, 2019
Overall, the ‘bitcoin vs banks’ debate will give a largely positive outcome for the financial world. A symbiosis between the two might also find its way to the surface. While banks have been able to consolidate their position over centuries, the road for bitcoin is long and tough.