Bitcoin: All You Need to Know

LARASATI OETOMO on BUSINESS

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Everyone is going crazy for Bitcoin—one of the most popular cryptocurrency out there. Will cryptocurrency be a revolutionary public transaction method, or will it be the 21st century version of “tulip bulb mania?” Here's what we need to know.


What is it?

Despite its popularity, the number of people who understand how cryptocurrency works is only 24 percent in USA, according to Statista. Unlike regular currency, cryptocurrency relies on the digital encryption of the money for security reasons. The cryptography system theoretically disallows any intervention, manipulation, and centralized regulation.

Is it better than gold?

Bloomberg reported that this year only, more people are Googling “buy Bitcoin” instead of “buy gold.”  As the latter surges their investment by 11 percent, the criptocurrency business has risen as far as 600 percent. It is also known that at least 91 percent of Bitcoin value depends on Google SEO, where people commonly look for the price of Bitcoin.

Bitcoin exchange value in past month (Coindesk)

Is it really secured?

Not really. As the backlash of this security system and anonymousness, cryptocurrency is typically vulnerable to money laundering and tax evasion practice.

Have they fixed that problem?

Following the possibility of threats, big cryptocurrency providers like Bitcoin improved their transaction mechanism with “block chain.” In the system, every billing copy is stored and copied in a ledger to get verified by Bitcoin miners across the networks. This method also enhances the transparency of Bitcoin distribution across users.

Bitcoin value chart 2015-2017 (Statista)

How worthy it is?

Bitcoin reached its all-time peak value with $8,000 few days ago, sevenfold more than the previous year. The number is expected to raise above $11,000 in 2018, according to Galaxy Investment Partners’ Chief, Mike Novogratz.

Okay, but there should be a setback, right?

Despite the impressive growth speed, market strategist Nick Colas states that cryptocurrency still does not have regulatory framework that meets the criteria as traditional asset. To become so, they need regulation. Novogratz at Reuters Global 2018 Investment Outlook Summit predicts that the institutionalization of digital currency is coming in next 6-8 months, including regulation from many countries.

PHOTOS Freemaxpixel, Statista, Coindesk


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