What’s happening with the Bitcoin price?
Bitcoin’s plunge is threatening mainstream adoption
Bitcoin, the Internet’s solution to an untouchable online currency, may have one flaw which can bring down its entire structure. According to researchers at Cornell University the flaw is so severe that it could wipe the entire currency off the web.
Business Insider states that the problem that threatens Bitcoin is how people «mine» this cryptocurrency. Mining is basically how Bitcoins are created and now most people don’t bother with that, they either buy them or take them as payment. Others, however, are in the Bitcoin Mining Business using special mining computers. Even so, with all this gear, it’s very difficult and time-consuming (even for a bunch of these special computers banded up together in pools) to create new Bitcoins. The fatal flaw of this mining system is that when too many miners join together, whereas a group, they can get more than their «fair share» of Bitcoins, essentially creating a monopoly over the entire Bitcoin system.
«The problem is intrinsic to the entire way Bitcoin works. A minority group of miners can obtain revenues in excess of their fair share, and grow in number until they reach a majority. When this point is reached, the Bitcoin…the currency…is no longer decentralized; the controlling entity can determine who participates in mining and which transactions are committed, and can even roll back transactions at will»
The solution is very simple. No single pool of Bitcoin miners can ever control more than 25% of the available mining power. Even though this flaw can potentially bring the whole system down in theory, the Bitcoin exchange rate doesn’t seem to be slowing down.
Concerning its price, it has significantly dropped these days as the virtual currency’s volatility threatens to undermine its ability to gain mainstream use. It is now successfully used in the minimum deposit casinos in Australia – https://www.onlinecasinotips.info/.
It’s known that Bitcoin once reached a very impressive peak but now, mainly because of its volatility, its price has started to decline, the lowest value since October 2013 was $181. 45, according to CoinDesk’s Bitcoin Price Index. Because of this unpredictable decline, Bitcoin was one of the biggest money-losing investments of 2014. «The price will continue to be volatile and driven by speculators in the short term» said Gil Luria, an analyst at Wedbush Securities Inc. «Nothing about the technology and its promise has changed, but in the short term that does not drive the price.»
Naysayers are worried that some governments will try to regulate or prohibit the currency (even though it’s technically impossible, Bitcoin has made gambling legal all over the world, even in the US) to crack down on criminals, and Russia is now moving closer to doing just that. A prolonged price drop can temporarily put the future of the currency in question. Mainly because the equipment and power needed to mine new Bitcoins are very expensive. On the bright side, many Bitcoin supporters appreciate its relative anonymity and transaction verification via a public ledger. And despite the recent drop, some of the biggest backers of Bitcoin are still standing their ground. «I am not going to comment on the recent price movement, other than saying I’m not concerned» Barry Silbert, chief executive officer of SecondMarket Holdings Inc., said in an e-mailed response to questions. Silbert’s company was part of a bidding group that won 48, 000 Bitcoins at a U. S. government auction in December.
«A Bitcoin can be worth $100 or $1 million, and its value will continue to fluctuate randomly as new uses for the currency’s underlying technology emerge,» Luria said. Venture capitalists, including Tom Draper, have invested millions of dollars into startups that are building new software on top of Bitcoin technology.
Bitcoin value is indestructible regardless of price
Bitcoin’s value as a speculative instrument will have a direct impact on its market price. There are many who, sour like a grape, will rejoice in its decline – calling it the «bursting of a bubble» and the eventual extinction of the «e-money» responsible for the greatest commodity rally in recent history. What these anti-Bitcoin enthusiasts need to take into account is that the movements in the Bitcoin chart are primarily the result of speculative trade.
The availability of leveraged Short Selling contracts (via exchanges and brokers) means that margin-based traders make equal earnings whether the Bitcoin price is going up or down. Meaning that this long decline mustn’t be interpreted as a Titanic-Esque loss on investment for most, but the coming of age of the derivatives component of this fledgling market instrument. Many Bitcoin critics were eager to use the phrase «Tulip Mania» and whined that «it has no inherent value!». Self-education is the only way to see what the blockchain is all about. The notion of Trustless transactions might not be that easy to comprehend but that the blockchain is decentralized and that its flagship, Bitcoin, is, therefore, censorship-resistant is perhaps too much tech jargon for most people’s ears. In layman’s terms, the blockchain is equally distributed amongst the users making Bitcoin impervious to all sorts of restrictions (it can’t be banned or made illegal).
Once the blockchain is understood, it soon becomes apparent that no other asset, whether a stock, a currency, or commodity, has or ever had, the «fundamentals» inherent in Bitcoin. The decentralization principle, the melting away of the need for trusted third parties, the inability of any government, central bank, or even the entire military-industrial complex to censor it – this is the disruptive value. Even though Bitcoin is a digital currency, the blockchain can store and account for more than just 21 million Bitcoins – documents, contracts, mathematically accurate and provable public consensus (such as votes), multinets (as opposed to the Internet) – everything can be stored in the blockchain.
Bitcoin value is underestimated by almost everyone. In bitcoin casino norge and others. It’s an innovative concept that some people have adopted and others are still trying to fight against it. The significant price drop was due to monopolization by miners trying to get a few extra bucks. This cryptocurrency is still in its infancy and needs to be regulated (for example, miners now can’t produce more than 25% of the total influx coming through). The biggest advantage of Bitcoin is its universality, it can’t be made illegal, and no corporation can control it mainly because of its ingenious decentralized system. To put it in other words, it won’t leave us as soon as some people think