As the price of Bitcoin (BTC) continues to rise, it is easy to get caught up in the hype surrounding cryptocurrencies and blockchain technology. The reason behind this excitement is the idea that given the potential it has to revolutionize the way we handle money, the value of cryptocurrencies can grow exponentially.
The hype may well be justified, and it would be unwise at this point to bet against these assets rising in value. Yet it is worth noting that Bitcoin, the first cryptocurrency, has now existed for well over a decade. Its original premise, as outlined by Satoshi in the original white paper was to create a “peer to peer electronic cash system” based on a digital currency with limited supply. This, in turn, could liberate individuals economies from the harmful influence of government and central banks, who continue to print money on demand.
The economic impact of the Chinese coronavirus pandemic will likely be devastating. Most economists are forecasting rampant inflation, conditions that will likely be favorable to the success of crypto and other alternative assets such as gold. This has already played out in recent months with many currencies, most notably Bitcoin, more than quadrupling in price.
Although prices may continue to rise, the other real challenge for mainstream cryptocurrencies is that they can be used as a form of electronic cash. Yet the crypto community is rife with internal divisions. Many of Bitcoin’s proponents now argue it should be the equivalent of digital gold. Other currencies, such as Bitcoin Cash (BCH) and Etheruem (ETC), provide faster on chain transactions that proponents say are cheaper and more reliable, thus making them more attractive to businesses and ultimately more valuable as a day to day currency.
The man dubbed “Bitcoin Jesus” and the CEO of Bitcoin.com, Roger Ver, said that whatever the circumstances, he expects 2021 to make previous bull-runs look insignificant. “2021 seems to be on track to make the 2017, 2013, and 2011 bull runs look like minor blips,” Ver told El American. “Bitcoin Cash is on track to be cash for the world. Etheruem is on track to become the computing platform for the world.”
At a time when many governments, particularly those of socialist ideology, are imposing greater control over people’s lives, crypto provides a method for individuals to seize back control from the state. In Venezuela, for example, cryptocurrency has already become a widespread payment method as merchants ditch the bolivar currency altogether. There have also been surges of use in Argentina, Zimbabwe, and Sudan, all of which are experiencing hyperinflation crises.
With the global economy heading for disaster, this year is the time for crypto to truly take over and revolutionize the way we deal with money. If it fails to do so under these conditions, one must question whether it ever will. It should therefore be incumbent upon all those concerned about the widening size of the state to embrace the benefits of crypto and join the revolution.
Disclaimer: The author maintains holdings in various cryptocurrencies, including those mentioned within the article.