Why Cryptocurrencies Like Bitcoin Are Trending In 2017 Into Year 2018

Unless you’ve been living under a rock, you’re aware that cryptocurrencies such as Bitcoin, Litecoin, Dash, Ethereum, and more are taking over financial headlines across the globe. These digital currencies boast price graphs with sharp increases (and sharp decreases) and accompany tales of people becoming literal millionaires overnight. Is all of this founded? Is it a sign of a new financial reality, or is it more akin to the dot com boom (and burst)?

Why Cryptocurrencies Like Bitcoin Are Trending In 2017 Into Year 2018

Here are some quick reasons why these trends are occurring and what questions you should be asking yourself.

1. Transfer Wealth Anonymously and Instantly

The primary benefit of using cryptocurrencies for wealth transfer is the anonymous nature of your transfers. If you have a banking, credit, checking, or retirement account, your net worth is associated with your value. If you make a transaction, it’s pretty much made public as far as you are concerned to the people who watch out to make sure nobody’s doing anything funny. This possesses some liability, no matter how innocent your transactions.

Consider those with favorable life insurance policies. They get the highest return on their policy because they underwent a strict evaluation process. Let’s say you are such an insured, and you’re hanging out with friends. One of those friends left his or her card at home and asks if they can pay you cash for some cigarettes. You know they are of the smoking age, and because they are your friend, it seems very innocent, right? After you purchase them some cigarettes, you get a very interrogative phone call from your life insurance company. They are downgrading your account because they see financial signs of a new smoking habit.

Your transfer of wealth came back and turned on you, even though you personally were in the clear with no wrongful intentions. As obscure as this story sounds, it happens every day around the world. People’s identity associated with their spending becomes a liability.

Cryptocurrency does not possess such risk. As long as you play it safe, your transactions won’t be observable by the government. The more that technology evolves, the more that Big Brother is able to keep an eye on your spending habits. A fully anonymous currency is necessary for the privacy of the general public.

2. Transfer Wealth Instantly

While there have been some speed bumps on the road of cryptocurrency’s progress, currencies such as Bitcoin are fairly instant in transfer in comparison to traditional wealth transfer methods such as money wiring (Western Union). Some situations necessitate an instant transfer to close friends or family members.

As soon as you submit a transfer of cryptocurrency, it’s immediately entered into the transaction queue for verification. Some cryptocurrencies transfer (verify) a lot faster than others. For example, Litecoin was created because Bitcoin’s limited block size of 1MB prevented sufficient verifications. Therefore, Litecoin possesses about a 400% faster transaction time in comparison to Bitcoin.

Also, because Litecoin transactions verify more often, the transfer fees necessary for exchanges are significantly less. Simply put, there’s less supply and demand when it comes to transaction times. That does not mean that Litecoin is a better cryptocurrency than Bitcoin. All this means is that it was created with the idea of transfer time in mind.

3. Price Over Time

Bitcoin was created by Satoshi Nakamoto to solve many problems that traditional paper (fiat) currencies have today. Fiat currencies are highly inflationary. Consider the Zimbabwean Dollar which, back in 2008, traded at 1000 per United States Dollar. In 2017, the Zimbabwean dollar traded at about 300 Billion per USD. While this is an exceptionally extreme example of inflation, it tells a good story how governments printing money is very harmful to the economy over time.

It is impossible for Bitcoin and other limited-supply cryptocurrencies to be subject to such inflation. For example, there will only ever be 21 million Bitcoin (in the year 2140) and there will only ever be 84 million Litecoin. No controlling power has the ability to add more coins to the market to meet demands.

No government can twist and change the value; its value is determined solely on what the general population consider it worth. This alone is a huge benefit for cryptocurrency investments. It’s very unlikely that the coin you invest in will become more available over the years.

The price of cryptocurrency is not only founded on functionality and usage; it’s founded on hype as well. As more and more of the population takes notice of these sharp price increases, more people become eager and willing to make their own investment. People invest because they expect their initial funds to increase over time. Many people invest simply for profits and return on investments rather than for supporting the values and reasons that cryptocurrency stands for.

Some consider this hype to be unfounded, which creates a “bubble” – that is, it creates a hyper-inflated value based on what people desire a cryptocurrency to be worthier. Regardless of this, the price growth of the past few years certainly implies that there is a great deal of potential with cryptocurrencies, even if its current values are higher than they deserve.

As the years pass, we’ll continue to see this hype – as well as expressions of cryptocurrency’s original purpose—to play out in real time. We’ll observe the price rising, dropping, and settling right where people deem it worthy. Create your own opinion regarding whether or not you see this price trend as being legitimate or fueled by hype. Consider for yourself whether or not you feel that certain cryptocurrencies are worth their investment.

Finally, do some very basic research on each of the most trending cryptocurrencies to decide for yourself which one you see benefiting the general population the most.