Why Bitcoin Bull market is Expected Soon. (Feb 2019)

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  • Published At: 08.02.19 07:06
  • Last Updated At: 10.12.19 02:51
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Bitcoin Bull market is Expected Soon

    Bitcoin seems to be gaining momentum again. In December 2017, the world’s biggest cryptocurrency hit all-time high levels, just shy of the US$20,000 mark before crashing all the way down to US$3,500 levels.

    Many reasons including regulatory crackdowns and a clogged network with high transaction fees led to the negative price sentiment. However, despite all these hurdles, bitcoin seems to be on its way towards the psychological benchmark of US$10,000, albeit at a much slower pace than last time around. The global sentiment for bitcoin seems to have taken a positive turn, slowly & steadily forming a very strong base before its launch to new highers.

Btc Value

Let us look at some of the reasons why bitcoin will rise again:

#1 Lightning Network

  Lighting network, which is seen as a solution to bitcoin’s scaling problem was implemented earlier 2018 and has seen positive implementation. The lightning network is basically a network which sits on top of the bitcoin blockchain and can be used to effect transactions through ‘channels’ and eventually make settlements on the blockchain.
These user-generated ‘channels’, are basically smart contracts on the blockchain that can send payments back and forth between users, in a “trust-less” manner. As the transactions on the channel are between two users, they need not broadcast it to the whole network, until the channel is closed. This makes transactions almost instantaneous and as no miners are involved, transaction fees are extremely low, if not zero.
This arguably helps create a much better user experience, along with lower transaction fees. However, the lightning network is still not fully implemented. On top of that, it faces some teething issues such as cumbersomeness in opening new channels, among others. Despite this, complete implementation of the lightning network promises decreased network congestion, and low
fees, eventually helping bitcoin’s use and adoption as an actual currency.

 

#2 SegWit Upgrade

        SegWit is one more technical implementation which has helped improve sentiments. The SegWit (segregated witnesses) implementation was an upgrade to the bitcoin network, first implemented in August 2017. This upgrade meant that more transactions could be carried out on the bitcoin blockchain, without affecting the block size, adding to efficiency without compromising on stability. This also means up to 80% lower fees, along with other security and stability upgrades to the network. While the SegWit implementation started way back in August 2017, its effects are visible only now as it took a while for the majority of the network to adopt the changes.

 

#3 Regulation and Taxation

      A regulatory crackdown on cryptos around the world seems to have taken a backseat for now. The year of 2018 saw countries like China, South Korea, and India clamps down on cryptos leading to a lot of panic selling. However, these fears seem to have receded, at least in the short term. G20 nations led by France and Germany have taken upon themselves to come up with a unified crypto regulation by July 2018 which could stand to legitimize the crypto space in the biggest crypto markets in the world today. In India, while the RBI cracked down by barring banks from dealing with crypto related businesses, it had nothing new to say regarding the legitimacy or legality of cryptos. Despite initial hiccups and panic selling all markets, bitcoin showed remarkable resilience. Remember regulation – of the right kind – which does not stifle innovation but protects user interests could stand to legitimize the crypto space. This is already happening worldwide...

 

#4 Institutional Money Incoming

      The crypto world which was more or less restricted to retail investors and small crypto funds seems to be opening up for the financial giants. A clearer regulatory environment is proving to be inviting to institutional investors. A Thompson Reuters survey says that one in five institutional financial firms have plans to start buying and selling digital tokens within the next 12 months. These are positive triggers, at least for the short term. But the road towards bitcoin at ATH and beyond will be longer and bumpier than it was earlier. Bitcoin and cryptos are far away from regulatory clearance. The crypto space still has a lot of bad actors and fake coins and Ponzi schemes which need to be weeded out. Technological and scaling improvements such as lightning and the like are yet to be fully implemented across the network.

 

Concluding 

So. All in all, there are a lot of positive triggers for the crypto space going forward. However, the journey will not be without its fair share of bumps and hiccups. But rest assured it will be interesting and rewarding to those paying attention.

"Stay tuned and HODL away!"

 

 

 

 

 

Contributors

EDITOR TIME OF EDIT VIEW
Sahay (30) 9 months ago

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