Bitcoin is on Fire. The Unstoppable cryptocurrency has hit an all time high this morning topping the $4000 mark and reaching dizzying heights of $4158 before retracing slightly. What is the reason behind this 2017 phenomenal rise? Is Bitcoin real money? Can Bitcoin be considered to be a safe investment? Is Bitcoin here to stay?
These are all the questions that and plenty more that seem to be on everyone’s conversation. Bitcoin, blockchain and crypto currencies are the flavor of the day. What does the future of cyber money look like? The average price of Bitcoin across exchanges all over the world today exceeded $4000 on the Coindesk Index. This has marked a new all-time high.
In this article today, we go through the stellar history of Bitcoin, the challenges that this crypto currency faces, and the prospects for its future.
Bitcoin is on Fire – Why Does Bitcoin Keep Climbing?
August 2017 is certainly a very important in the ten-year life span of Bitcoin. Not only has the crypto currency survived a hard fork earlier this month, it saw the implementation of SegWitx2 – a new system by which the speed of transactions should improve substantially.
This month has been a real test for Bitcoin. A fraction of miners, developers, and investors drew the line on Bitcoin earlier this month. They took with them the historical information of Bitcoin and created a new block chain called B.Cash or Bitcoin Cash. The new currency is set to have the power of being ten times faster in recording transaction than the classical Bitcoin.
However ever since this split, Bitcoin is on fire. Bitcoin has seen a very strong growth of more than 30% until it literally went through the ceiling this morning at $4000 and more. Earlier in August 2017 Bitcoin was quoting at $2800. Bitcoin cash was quoting at $290. Bitcoin Cash has also been on the climb but at $340 it is just seeing a 17% increase as compared to the 30% increase of Bitcoin.
There is no question that Bitcoin is on Fire! But Why?
We will be watching the game between Bitcoin and Bitcoin cash with a lot of interest in the future. Anyone who held Bitcoin with a credible Exchange will have been immediately been awarded FREE Bitcoin Cash coins and will now be literally sitting on a gold mine with both currencies in their pockets.
Many Exchanges have promised to spruce up their systems in order to be able to award the free Bitcoin cash coins due to their clients. Some Exchanges have admitted this could take as far as early next year.
The reason for which Bitcoin is on Fire is not a coincidence. Bitcoin is the first ever crypto currency to be created. Despite its notorious past and connotations with the underworld, its name is being cleansed on a daily basis.
Bitcoin is seeing an improvement in the general sentiment of the public. There is more awareness about the advantages of using crypto currencies for peer-to-peer payments.
Moreover, governments are moving towards embracing crypto-currencies as a legitimate form of payment. April 2017 has seen Japan official recognize Bitcoin as a legitimate source of payment and Russia is making moves at moving in the same direction. Furthermore, Europe has been giving Bitcoin plenty of exposure in its media.
Reasons Why Bitcoin is On Fire Following The Lock In Period of SegWit
August 8th saw the official lock in period to set in for Segregated Witness (SegWit) on the Bitcoin network. The SegWit proposal dates as far back as 2015 and it is basically a system that upgrades the speed of recording transactions on the network.
Bitcoin is on fire for a few years now, and the sheer volume of added transactions have encumbered the system and made it heavier. SegWit and more recently SegWitx2 in simple language, are systems that will not only improve the speed of recording transactions, but SegWitx2 is supposed to double the present capacity of records.
Miners have been signaling their support for SegWit for two weeks prior to the lock in period. Whilst it is not impossible for miners to de-signal their support, it is quite unlikely that they would do so. This is because they stand to gain financially by supporting the system. Miners get paid token money for each and every transaction that they update on the blockchain.
Segwit has locked in. However, we are currently living the “grace period”. The change will activate on August 21. Segwit will officially become part of the network and activate on block 481,824. At this point, Bitcoin Exchanges and services need to upgrade their software systems. This is necessary to support this new and improved style of transactions.
The whole point of the grace period has been simply to give time to miners and exchange to upgrade their systems so that everyone can change in unison.
SegWit Has Reached The Levels of Support It Requires – Is This Why Bitcoin is On Fire?
There is no question, that the fact that SegWit has reached the level of support and is currently living through the lock-in period, that the confidence in Bitcoin has been on the rise.
It figures that the fact that SegWit has been embraced, the technological challenges of Bitcoin are being addressed. This again is instrumental in strengthening the confidence factor.
The fact that miners have signaled their support has been a turning point for Bitcoin.
Notwithstanding all this support and confidence, we are still to see the system kick in and work for real in the months to come.
21st August is the next Milestone – Will Bitcoin Be On Fire and Soar Higher?
The next milestone is around the corner. The grace period will be over and we will start seeing SegWit 2 work for real. We will also see the challenges that miners, Exchanges, and investors will be facing with the new system.
On the other hand, once the system is in place, and start working, we could really be seeing the new world of digital currencies taking over a larger chunk of trading and the economies. These are early days, but the future is very promising.
Questions like will Bitcoin die? do not seem to feature on anyone’s agendas any longer. There is a general acceptance that crypto currencies and especially blockchain technology are here to stay.
Note by author: Bitcoin hit $1000 on New Year’s day 2017 and hit $4000 on Saturday 13 August – if you had bought 1 bitcoin at the beginning of this year – you will have quadrupled your investment.
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