Food for thought…
Thinking aloud again and could be totally wrong about this – but common sense plus monetary policy history tells us that in order to create and build on something like a currency you need a solid foundation. Bitcoin is here to stay and every day, financial institutions, celebrities, and artists are endorsing it. It also has intrinsic value otherwise companies (incl. Microsoft) accepting it as payment for goods and services are either ballsy or just plain stupid!
More and more financial institutions are accepting and legitimizing it and with the news that Polish authorities funded anti-crypto campaigns coming to light, it is evident there is a noticeable fear of its potential to put an end to bank monopolies.
And as much as monetary authorities make it sound as though they are out to protect the public’s interests, this is probably unlikely the genuine cause of their concerns.
Ethereum founder, Vitalik Buterin, played the safe card by recently warning that Cryptocurrencies can drop to a zero value and must not be used as an investment vehicle – and rightfully so! Each Crypto has a distinguishing function other than a being a commodity on an exchange.
And though it is too volatile and way too expensive to be used as a global legal tendency it can still be broken down into increments and used to purchase other cryptocurrencies such as one called Ripple (which is bank-backed and likely to become widely accepted).
In the world of cryptocurrencies, Bitcoin would then be the standard – like gold.
Bitcoin can, therefore, be considered as the grandfather of cryptos, and the base of all cryptos rather than one that will be made readily available as standard payment instruments. Its ‘base’ and ‘foundation-like’ presence is felt by the gravitational pull (dominance) and influence it has on the movements of most other altcoins on the blockchain.
Bitcoin will probably have another rampant rally and then settle eventually at a price just around or under $10 000 (or even much higher due to the forces of demand and supply) It will nevertheless eventually settle at a price that would make it stable enough to be considered a standard after all 21 million of it has been mined.
This was probably the vision that ‘Satoshi‘ had: to create it and own most it as with the institutions that hold gold reserves. The blockchain technology will improve (and is already doing so exponentially) with many other Altcoins offering quicker money transfer capability and thus rendering Bitcoin even more redundant in its purpose of offering quick transactions unless it undergoes a rampant upgrade. It will, however, still remain a tradable commodity – like gold, an old painting or collectible antique.