New Era For Bitoin

New era for Bitcoin, transition of Bitcoin from payment system to the internet of money

The price of Bitcoin is going through the roof. Some sources are speaking of a bubble and others forecast way higher prices. Nobody can see into the future, but a rise in the value of the Bitcoin network increases the likelihood of a rise in price. We think Bitcoin is entering a new era and we see a huge gain in value of the Bitcoin network. We think the price will go even higher, but in this proces there will probably be some corrections of 10 to 30%. This is totally normal for cryptocurrencies.

Segwit will transform Bitcoin to the internet of money
Investors are turning to Bitcoin
Different countries are legalizing Bitcoin and Russia starts mining
Scaling issue is partly solved after years
Bitcoin network is more secure than ever
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Segwit will transform Bitcoin to the internet of money

Next week Segwit, an important update will be implemented. This means that the Bitcoin network can handle two times more transactions using the same amount of data. More important is the fact that Segwit will enable so called 2nd layers.

This creates the possibility to implement all features done by altcoins to be implemented in Bitcoin using side chains. Rootstock (RSK) and Lightning Network (LN) are almost ready to be launched and will bring smart contracts, micro payments and privacy to the Bitcoin network.

In the months and years to come all available blockchain applications will be enabled on the Bitcoin network. This will transform Bitcoin from a payment system to the internet of money. Furthermore it will scale the network exponentially.

Investors are turning to Bitcoin

After years the bad reputation of Bitcoin is finally slowly fading away. Mainstream media like CNBC and Bloomberg are mentioning it in a positive way and famous investors are starting to add bitcoin to their portfolio. GBTC, the only Bitcoin security available on Wallstreet is valued at 7500 USD per bitcoin at the time of writing. This means the demand under investors is huge, they are willing to pay about 90% premium!

Different countries are legalizing Bitcoin and Russia starts mining

In Japan they announced bitcoin to become a legal currency and it is expected that 200.000 stores will start to accept it this year. Also Australia, South Korea, India and Russia are in the proces of legalization. Russia is even planning to start mining on big scale. This could signal that Russia is planning to hold bitcoin in their treasury!

Scaling issue is partly solved after years

The rise of Bitcoin is delayed for years by the ongoing scaling debate about how to upgrade the capacity of the network. One side of the debate saw Segwit as the solution, but the others wanted a block size increase. Next week Segwit will finally been implemented and the recent hard fork created another coin for the other part of the community. Now both sides can go on working on their own vision.

Bitcoin network is more secure than ever

The security of the Bitcoin network will follow the price. The recent rise in price will increase the security level of the Bitcoin network (miners ensure the security of the network and after a price increase more people will start mining). One of the most important factors for Bitcoin to get value is the fact that it is the most secured network on earth.

At the moment the security risks are among the users. Online wallets and exchanges get hacked regularly. Happily a hardware wallet can almost fully eliminate the risk.

Conclusion

The bitcoin price has risen enormously, but the fundamentals are supporting it. In our view there is no bubble yet, but a serious correction in the short term can be considered as normal (happened a few time already this year).

When investors and nation states turn to bitcoin, not billions but trillions can flow into the tiny market capitalization of bitcoin (70,7 billion) and will multiple the price many times. In long term a bitcoin price of tens or hundreds of thousand USD is realistic in our view.