As the world of digital currency enters its eighth year since being regulated as a commodity by U.S. futures and swaps regulator the CFTC, Bitcoin remains at the forefront of cryptocurrency. From its inception in 2009, Bitcoin has paved the way for cryptocurrency to become part of our lives and has led the way to the world of decentralized finance. As Bitcoin looks ahead to a future of greater adoption and better technology, let’s take a look back at how it has grown and changed since becoming a recognized commodity.
1. The Rise of Bitcoin: Commodity Status in the US 8 Years On
In the short 8 year span since it’s launch, Bitcoin has experienced massive volatility in its value, yet value is not the only thing it has achieved. In the US, Bitcoin has officially achieved the status of a commodity. This has major implications in the worldwide economy that already did the same, including Japan and Australia.
The sheer scale of the cryptocurrency market was impossible to ignore. After a period of wild speculation and unmitigated growth, Bitcoin has been granted a critical measure of respectability in the eyes of many. It’s now seen as a tradable asset; one that can be used to facilitate transactions across borders and multiply investment quickly.
- The respectability of Bitcoin has encouraged more mainstream investors. It’s now being seen as a legitimate way to diversify an otherwise solid portfolio.
- Full regulation of cryptocurrencies is much closer. As Bitcoin’s status within the US has been dictated by the Commodity Futures Trading Commission, we may now expect a great deal of expansion with regards to the enforcement of guidelines.
2. Increased Trust: Why Bitcoin Proved Its Staying Power
When Bitcoin first appeared on the scene, it was widely scoffed at and few analysts gave it much long-term staying power. Fast-forward to today, and it is now a trusted asset class with a market capitalization worth hundreds of billions of dollars. So, how did Bitcoin prove its critics wrong and solidify its standing as a trusted asset?
One way is through its immutability. All Bitcoin transactions are recorded on a distributed ledger and kept in multiple locations – making them close to impossible to tamper with or hack. This high level of security has led to increased trust amongst Bitcoin investors and users, making them comfortable investing their money over the long term.
- High Degree of Security – Users enjoy trust in the Bitcoin network due to its extremely secure network of cryptography.
- Immutable Records – Bitcoin transactions are recorded on a distributed ledger and kept in multiple locations, making it almost impossible to tamper with.
- Wide Acceptance – With its high level of security, Bitcoin has gained wide acceptance from investors and users, making it a trusted asset class.
3. Bitcoin’s Journey: Moving Beyond Monetary Insecurity
The journey of Bitcoin has been one of constant progress, reshaping the world of finance and giving individuals an unprecedented level of security when it comes to their money. From its humble beginnings as a way to circumvent traditional financial institutions, Bitcoin has become a truly revolutionary force in the world.
Today, Bitcoin is advancing into exciting new territory, offering much more than just protection against monetary insecurity. The coins’ decentralized nature and its open source code free from government interference allow for the development of a variety of features:
- Real-time value transfers – coins can be sent around the world with little to no delay and at very little cost.
- Rapid transactions – transactions can be completed with an almost instant speed.
- Privacy and anonymity – transactions remain private and untraceable.
Ultimately, Bitcoin’s journey has enabled users to take control of their financial future and make financial security accessible to everyone. All of these features are part of Bitcoin’s groundbreaking journey, opening up new pathways for financial privacy and security.
4. Increased Legitimacy: How Bitcoin Earned Its Spot on the Commodities List
Establishment of Legitimacy
Despite initially being labelled a fad and a risk, Bitcoin has transitioned into a system of credibility and trust. Numerous organisations and institutions have been established to monitor and regulate Bitcoin, which has exponentially increased its popularity and established legitimacy. Unprecedented levels of transparency and open-source accessibility allows users to interact directly with the network. This has increased the trust and acceptance of Bitcoin greatly.
Bitcoin’s legitimacy was cemented further when it made its debut on the commodities list in 2017. This was due to the key events that had happened in the preceding years:
- Investment by banks and corporations
- Drive towards compliance and regulation
- Increased focus on security
- New financial services and products
- Acquisition of Bitcoin-based companies
The addition of Bitcoin to the Commodities list created stability, and further legitimised the cryptocurrency and the underlying technology. It has been a key step in the journey of cryptocurrency, and it will continue to be a key component if it is to be seen as a legitimate financial instrument across the globe.
5. The Bitcoin Boom: What the Future Holds for the Cryptocurrency
The bitcoin boom which emerged in 2017 and has continued into this year is truly remarkable. Despite its critics, the cryptocurrency is gaining traction all over the world and poses as an exciting prospect. But what does the future hold for bitcoin and other digital currencies? Let’s take a look.
One of the main elements that has seen bitcoin soar in popularity has been its use as an investment tool. Many avid Bitcoin advocates swear by it, while traditional investors view it as an interesting experiment. It is fair to expect that bitcoin will remain a viable option for investors for the foreseeable future, and it will likely become even more accepted by leading financial institutions.
- Feasibility: Bitcoin could become a regular part of payment processing systems, breaking away from the ‘buy low-sell high’ mode.
- Adoption: Other cryptocurrencies will come into play and accepted more widely. A broader range of digital coins may emerge.
- Regulation: Government regulations will become more sophisticated, helping to protect consumers from fraudulent activities.
Although the cryptocurrency market can be volatile, particularly when compared to stocks and other investments, it is an interesting prospect largely thanks to its accessibility, speed of transactions and decentralization. With the right mix of regulation, technology, and education, the bitcoin boom could continue for a long time to come.
The bitcoin revolution continues as the 8th year of its commodity status in the US comes to a close. As digital currencies become more and more commonplace, the future of digital banking and the phenomena of cryptocurrency is still yet to be seen. But its current success and staying power in the market heralds a hopeful and exciting new direction for the future of money.