Don’t Get Your Hopes Up About Bitcoin Just Yet

Over the past few weeks the markets have started to look very positive. Bitcoin itself is starting to perform in a positive way, miles better than the dismal performance Bitcoin did show us through 2018 and the start of 2019. Forbes have recently published an article that warns investors not to get their hopes up just yet. Yes, things are looking good and some of the indicators are there, but Bitcoin probably hasn’t matured to a level that could inspire another bull run, just yet at least.

Remember, cryptocurrency is risky. When Bitcoin looks positive there are profits to be made, however as investors we must be careful and prepare for the worst, therefore if you do decide to invest, make sure you do your own research first and be sure to only invest what you can afford to lose. Trade safely and Bitcoin could work out for you.

Forbes suggest that there are three main points that we need to consider in order to justify not getting too excited just yet, these are; Anonymity, Mining Centralisation and Exchange Centralisation. In short, Forbes believe Bitcoin isn’t yet what it promises to be, a fully decentralised currency, one that protects users and their data. Because of this, Forbes believes Bitcoin still has time to grow. Let’s take a look at some of their key points then:

“A decent chunk of bitcoin’s potential value and usefulness comes as a hedge against a dystopian cashless society where governments and large financial institutions are tracking everyone’s financial activities, so improvements in privacy should be seen as a priority for developers and users.”

This is correct, Bitcoin is not yet fully anonymous and therefore, developers are currently working on ways to make Bitcoin more private. When this happens, investment is likely to shoot up and hopefully, so will the price of Bitcoin.

“The current state of mining involves large pools that are easily identifiable. While recent reports of cryptocurrency exchange Binance potentially colluding with these mining pools to push for a reorganization of the blockchain in the aftermath of a hack were somewhat overblown, the fact that coordination between mining pools is possible should be viewed as less than ideal.”

Likewise, the way mining works means that Bitcoin can’t be fully decentralised, the same goes for the use of cryptocurrency exchanges also. These are creases that also need to be ironed out of Bitcoin promises to truly reach its full potential. If developers and designers can help make Bitcoin as decentralised as it promises to be, again, we can assume that a huge wave of investment will flood in, pumping the price.

The take home message here is this - whilst things look positive at the moment, Bitcoin still has a long way to go, so hold on, keep investing and let’s wait for the real bull run, that’s when things will get exciting.