With its foundations laid just over a decade ago, Bitcoin has taken the world by storm in its relatively nascent existence. What was once an idea has evolved into one of the most popular digital assets in the financial world today. Retail and institutional investors alike have been pouring in as the digital coin transcends to new horizons of success. Crypto supporters and enthusiasts view it as the future of money, unaffected by the manipulations of governments and central banks.
Early this summer, the world’s largest cryptocurrency conference took place in Miami, where El Salvador’s president launched his plan to become the first country to accept Bitcoins as legal tender. According to official statistics, the Bitcoin Law passed by a 62-22 margin or “supermajority” by the country’s congress. According to the bill, businesses and shops will be required to accept bitcoins.
With the adoption of bitcoin as legal tender, El Salvador becomes the world’s first. This means Salvadorans will be able to pay bills and taxes with bitcoin starting in September, and that all businesses in the country will have to accept the digital currency – from McDonald’s to the fruit stand next door.
It is estimated that nearly 70% of the country’s population does not have a bank account. According to El Salvador’s president, Nayib Bukele, his plans will assist Salvadorians who are abroad, especially in the United States to send money back home. Moreover, he explained that a new Bitcoin-mining facility will be built in the country that will harness volcanic energy generated by a manmade well.
Obstacles to Bitcoin’s Success
Bitcoin is being embraced by many at the moment. There is a stark difference in China, however, which has banned cryptocurrency services in banks and blocked accounts promoting digital money on microblogging site Weibo. Crypto mining and trading have also been restricted in the country.
One of the reasons may be the damage to the environment. At least seventy percent of the machines used to process cryptocurrency transactions are based in China. Their energy consumption is estimated to exceed that of Argentina each year. Another reason is speculated to be China setting the stage for its own cryptocurrency, the digital yuan, which was introduced earlier this year.
Satoshi Nakamoto, the anonymous creator of Bitcoin, originally envisioned it as an alternative currency to fiat money when he launched it in 2010. It has been unable to cement its position as a viable alternative to the dollar, however. Most investors regard Bitcoin as being more like gold; an asset in which they can store wealth.
Extreme Volatility in the Crypto Market
While its price may be on somewhat of a rollercoaster ride since the beginning of the year, Bitcoin’s popularity has seen tremendous growth. Despite the fact that it has not been categorized as a financial currency yet, it is becoming an increasingly popular investment instrument due to its highly volatile nature and, consequently, the potential for huge profits.
The coin’s value, which reached a high of $64,000 earlier this spring, has been known to rise and fall dramatically. Since its record high, the digital asset’s value has taken a hit. Currently, it is moving in a relatively stable range of $30,000 to $40,000 per unit.
Making big bets in this highly volatile crypto playground is, therefore, not for the faint of heart. Taking a gamble without caution could quickly result in huge losses. This is particularly true for beginners. However, the emergence of cryptocurrency trading platforms and tools has enabled several novice investors to enter the crypto market and trade without knowing the inner workings of the market.
These trading platforms, such as Quantum AI, employ advanced technologies like Artificial Intelligence (AI), Machine Learning (ML), along with powerful algorithms to help users make the best crypto trading decisions. The platforms also come with auto-trading capabilities that are accessible even to seasoned investors but are especially targeted at novice traders who find these platforms to be a safe haven for their investments. The advantage is because they make decisions on your behalf, so you won’t have to spend countless hours watching your computer monitor for even the smallest movements.
Conclusion
As Bitcoin is adopted nationwide, analysts will have a first look at the cryptocurrency’s impact on the economy with El Salvador’s experiment. There are concerns that the greater use of digital assets such as Bitcoin may reduce the effectiveness of the monetary policy. Others are alarmed that this move by El Salvador could stress the blockchain.
See Also:
