Bitcoin Will End Up in One of Three Ways, Predicts Expert
Still only nine years old, Bitcoin continues to be a major topic of discussion within the global business industry. Bloomberg’s Noah Smith believes that the future of the top-ranked cryptocurrency has three possible outcomes.
Three Possible Future Scenarios for Bitcoin
Smith’s first scenario sees Bitcoin replacing fiat currencies all over the world. In this construct, BTC becomes the de facto payment means for all types of transactions like mortgage payments, import duties, etc. Notable “techpreneurs” like Jack Dorsey (Twitter and Square) as well as Steve Wozniak (Apple) believe that Bitcoin will become the single global currency within the next decade.
The second path has Bitcoin becoming the new gold. In this scenario, BTC doesn’t replace fiat except in failed economies like present-day Venezuela. Instead, it becomes a highly valuable commodity that investors can use to hedge against stock market crashes.
The final forecast for Bitcoin is that its value plummets dramatically, becoming worthless in the process. Consequently, the popular cryptocurrency is abandoned to the junkyard of failed digital revolutions.
The Path of Least Resistance for Bitcoin
Smith believes that the second scenario is the path of least resistance for the digital currency. While his analysis is compelling, to say the least, there are some flaws in the logic behind the choice. For one, Smith uses only two parameters – the BTC/USD exchange rate and the USD inflation rate – as the basis for his analysis.
Based on the likely behavior of those two parameters, Smith thinks that Bitcoin is destined to become like gold. He brings up the finite supply argument but ignores the fact that BTC is divisible up to eight decimal places.
There is as much data to prove Bitcoin’s suitability as currency as there is to establish its suitability as a high-value commodity. Smith is correct to say that interest in Bitcoin is unlikely ever to die out. Instead, it appears to be maturing with volatility currently at its lowest value.
Bitcoin Will Die Out at $43
Not everyone is so optimistic about the future of Bitcoin, however. The chief security scientist at Thycotic, Joseph Carson, believes that the Bitcoin death scenario is the most likely of the trio. According to Carson:
The most likely scenario is that bitcoin will die; my current valuation of bitcoin is approximately US $43 as opposed to the hyped and manipulated valuation. Unless Bitcoin is able to become more efficient at mining, and more stable overall, it is likely to die. These higher mining costs and the fact that more retailers are failing to accept bitcoin as payment – as they are unable to convert it as it is too expensive – will mean the end of it.
Like most BTC doomsday prophets, Carson shows a lack of understanding of how Bitcoin works, throwing up unsubstantiated “facts” to back up his claims. Even his analysis lacks substance, as he fails to explain how he arrived at his $43 Bitcoin valuation.
Which scenario do you think is most likely for Bitcoin? Keep the conversation going in the comment section below.
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