Bitcoin has been in the news lately, thanks to the recent market highs it attained in the last few weeks. The cryptocurrency has been on an astonishing trajectory that has outpaced other investments, including stocks, property, and commodities.
Although the world’s central banks and institutional investors may not be huge fans of Bitcoin, the digital currency has continued to enjoy widespread adoption by organizations including Tesla, PayPal, MicroStrategy, MasterCard, and more. With the flood of investments and adoption, is Bitcoin really going mainstream?
History of Bitcoin and the assertions of skeptics
If you’re reading this article, there’s a good chance that you know what Bitcoin is, but knowing how the cryptocurrency’s phenomenon started can help you understand whether or not Bitcoin is going mainstream.
The idea behind Bitcoin was unveiled in October 2018, during which the world was grappling with an economic crisis. The white paper was presented by a person or a group of persons with the pseudonym Satoshi Nakomoto.
Designed for use as a medium of exchange and bypassing the traditional banking infrastructure, Bitcoin was launched in 2009. At the time of launch, the value of one Bitcoin was $0, but it started trading from around $0.0008 to $0.08 per coin in July 2010.
The value of Bitcoin gradually increased due to a number of factors, including the establishment of exchanges in 2010, making it easier to sell, buy, trade, and store the digital currency.
12 years later after its launch, Bitcoin is currently valued at $59,065. Bitcoin’s history can be summarized as an astronomical growth punctuated by a few severe price retrenchments.
Although Bitcoin has been around since 2008, it started garnering acceptance only a few years ago, and it makes sense to agree that it has a lot of potentials. However, before Bitcoin started going mainstream, many people dismissed the cryptocurrency and warned others to stay away from it.
Early Bitcoin skeptics
There are tons of assertions by skeptics and naysayers, but it might interest you to know what people had to say about Bitcoin in its early years. Here are a few:
- In June 2011, Peter Schiff, the CEO of Euro Pacific Capital Inc. said. "You can’t do anything with a Bitcoin other than trade it for something you want. So, intrinsically, the Bitcoin itself has no value." - Source (YouTube)
- Around the same period, Tim Worstall, who was a journalist, wrote about Bitcoin in an article entitled, ‘So, That’s the End of Bitcoin Then.’ "It’s difficult to see what the currency has going for it," he remarked. - Source (Forbes)
- Ian Bremer, founder, and president of Eurasia Group, which was the world’s largest risk consulting firm at that time. He predicted the end of Bitcoin on May 14, 2013, when he said, "I would be very surprised if Bitcoin is still around in 10 years." - Source (CNN Money)
- On January 23, 2014, the president and CEO of JPMorgan Chase, Jamie Dimon, dismissed Bitcoin and was quoted during an interview with CNBC saying, "It is a terrible store of value," and that "It could be replicated over and over." - Source (WSJ MoneyBeat)
- Lending his voice to the wave of discussions against Bitcoin, Warren Buffet in March 2014 advised people to stay away from Bitcoin. "Stay away from it… It’s a mirage basically." - Source (WSJ MoneyBeat)
- A contributor to Washington Post, Vivek Wadhwa, on January 19, 2016, wrote, "Bitcoin did have great potential, but it is damaged beyond repair. A replacement is badly needed." - Source (The Washington Post)
These are just a few of the harsh remarks skeptics made about Bitcoin in its earlier years, but Bitcoin hasn’t just survived the negative predictions but has risen dramatically in value, with analysts predicting that it could hit $100,000 before the end of the year.
Thanks to Satoshi Nakamoto Institute for compiling the list, which can be seen in full here - https://nakamotoinstitute.org/the-skeptics/
What are the signs that Bitcoin is getting more and more mainstream?
There are many reasons Bitcoin is increasing in popularity and winning over many of its skeptics.
Celebrities and entrepreneurs such as Elon Musk keeps tweeting about Bitcoin & other cryptocurrencies (such as Dogecoin)
Actress & Artist Lindsay Lohan
Besides the latest Twitter hype, here are some signs that digital currency will only get more and more mainstream in the coming days and years.
A rise in consumer adoption
One of the biggest reasons Bitcoin will continue to soar is that it is accepted as a payment method among younger consumers. Consumers trust Bitcoin for a variety of reasons, including the privacy it offers, independence from the government and central banks, low fees, security, and more.
Adoption by many companies
If you’ve been following the news lately, you’ve probably heard or read the report of electric carmaker Tesla investing $1.5 billion into Bitcoin and announcing that the organization is planning to begin accepting it as a means of payment.
In a similar vein, many other global companies (like Microstrategy, Square Inc., and Galaxy Digital Holdings) are embracing Bitcoin and are holding portions of their cash reserves in the digital currency.
Long-term investors reduce the Bitcoin ‘float.’
Although only 21 million Bitcoins can be mined, a little more than 18.5 million Bitcoins have already been mined in the last decade. This might seem like a lot, but only 8 million are available for use as payments on any given day, while long-term investors hold the rest.
As the number of long-term investors rises, there will be a corresponding decrease in the number available for payments. The consequence is that the smaller float of Bitcoins will drive up the price of each coin.
Perhaps, the biggest sign that Bitcoin is going more and more mainstream is trust – trust in the concept, trust in the underlying technology, trust in the adoption by some of the biggest players in the investment community, trust in the recommendation of influencers like Elon Musk and Lindsay Lohan, etc.
The growing level of confidence is contagious and encourages the use of Bitcoin both as a payment option and as a lucrative investment opportunity.
Discussions about Bitcoin can be quite polarized, especially due to its meteoric rises and falls. However, with celebrities, public companies, and governments embracing Bitcoin, the future looks much brighter for both Bitcoin and the digital asset market as a whole.