People have seen enough debates about Bitcoin, Ethereum, regulations on the cryptocurrency markets, etc. After going through nearly a decade of uncertainties pertaining to the cryptocurrency market, people want to know where the digital coins are heading. The problem is that predicting the future is still, at the end of the day, a prediction. You can never be sure about anything but you can definitely have an opinion about things. Better yet, you can talk about all the factors that will affect the presence or non-existence of something in the future, so people can build their own opinions based on those.
So, what’s the future of cryptocurrencies? Well, we can delay the thought of the future of cryptocurrencies for a moment and focus more on the present value of it. Have you seen XTRgate.com? Well, give this broker a shot and you will realize how much money you can make from cryptocurrencies today. So, even if the future, for the sake of argument, is dark for cryptocurrencies, you can make some money from them today. At least, fiat currencies are not going anywhere in the near future. That applies even if cryptocurrencies do get a breakthrough.
Here are some factors that will decide the future of cryptocurrencies.
The Efficiency of the Technology
The first thing you have to look at is the efficiency of the technology that is at the core of cryptocurrencies. The blockchain is usually explained with easy examples and simplified illustrations. That’s a proof that the technology is complex, and not to easily understood by everyone. The first thing you can keep in mind is that every cryptocurrency needs to be “produced”. The production of a cryptocurrency is called mining. Mining is a process that involves the use of heavy-duty computers with monstrous graphics cards trying to solve difficult cryptographic puzzles to make cryptocurrencies work.
This concept is labeled as “proof of work”. In short, the more work a computer does, the higher its chances of confirming a certain number of transactions and earning some digital coins in return are. However, the blockchain is getting more and more complex with time. As time passes, you will need heavier computers and more processing power to solve the riddles and keep the cryptocurrencies going. That’s a lot of heat you are talking about if you think about a world where cryptocurrencies are a standard. Bitcoin is perhaps the most resource-consuming of all cryptocurrencies out there.
It is for this particular reason, many experts believe that Bitcoin will not survive in the future. Different ways have been invented to make the mining process in cryptocurrencies more efficient, but the results have not been very welcoming. For example, even the efficient mining processes have not been able to achieve fast transaction speeds. This has caused people to believe that the blockchain transactions can never be fast.
The Legitimacy of the Concept
Another important factor on which the future of cryptocurrencies rests is the legitimacy of the concept. You must have heard by now how many countries of the world have already banned the use of bitcoin or any other cryptocurrency. At the same time, financial authorities like the SEC are constantly after cryptocurrencies and other associated blockchain technologies to verify their validity. As it turns out, many cryptocurrencies are not what they pretend to be. As a result, they face the hammer from financial institutions like the SEC.
The Adoption Rate of Cryptocurrencies
You have to look at the pace at which people are adopting cryptocurrencies. When internet was invented, it exploded in the world and spread faster than anything in the past had. That’s because it was a service and something that people only found benefits in. That’s not the case with cryptocurrencies. With whatever has happened in the past e.g. exchanges running away with millions and billions of dollars of investors’ money, people do not always think positively about trading cryptocurrencies. They want assurance of some kind and for some reason, they have not been able to get it to this day.
Not to mention, some cryptocurrencies, such as bitcoin, are so highly priced that an ordinary person cannot even think about owning this coin. As of now, people have used cryptocurrencies for ordering things online. The real adoption rate is when people will be eating pizzas at restaurants and drinking coffees at cafes and paying with their digital coins. It is not enough for you to be ready to pay in digital coins. In fact, adoption rate is when the shop owners will be equally willing to accept digital coins from you as a payment for their services and products.
The Removal of Negativity
Believe it or not, people do not associate the use of cryptocurrencies with proper methods of transactions to this day. They think that cryptocurrencies are only for rich people who want to hide their identity while storing their money in easy to access wallets. The blockchain technology requires everything to be decentralized i.e. no government or bank can intervene in your transactions or even know how much money you own. In fact, when you conduct cryptocurrency transactions, the banks are not even there in the entire loop.
In addition to decentralization, the other big concept associated with cryptocurrencies is anonymity. When you conduct transactions on the blockchain, you are always anonymous. No one can trace you based on your transactions. This is what makes cryptocurrencies “shady” for many. However, people who think skeptically do not realize the main purpose of decentralization and anonymity associated with cryptocurrencies. At the same time, they do not look into the benefits of using cryptocurrencies at all.
There is a whole world of cryptocurrencies going on in the world today. There are millions of people who own digital coins and thousands of transactions are taking place on various online crypto exchanges every minute. Institutions and big names of the world have also started backing cryptocurrencies. With those things in mind, you can safely say that cryptocurrencies are not going anywhere. The only thing you should be talking about now is the value of cryptocurrencies in the coming times.