As the current world leader in the Cryptocurrency market, Bitcoin has made some serious headlines and some major fluctuations over the past 6 months. Almost everyone has heard of them, and almost everyone has an opinion. Some people cannot fathom the idea that a currency of any value can be created out of nothing, while others like the idea that something without government control can be traded as an entity of value.
Where do you sit on the Should I Buy Bitcoin? The fence probably comes down to one question in the end. Can I make money from Bitcoin?
Can you make money from bitcoin?
In just the last 6 months, we have seen the price go from $20 a coin in February, to $260 a coin in April, to $60 a coin in March, and to $130 a coin in May. The price has now reached around $100 per bitcoin, but what happens next is anyone’s guess.
Bitcoin’s future ultimately rests on two key variables: its acceptance as a currency by a wide audience and the lack of prohibitive government intervention.
The Bitcoin community is growing rapidly, interest in the Crypto currency has exploded online, and new services are increasingly accepting Bitcoin payments. Blogging giant WordPress accepts Bitcoin payments, and African mobile app provider Kipochi has developed a Bitcoin wallet to allow Bitcoin payments on mobile phones in developing countries.
We have already seen people make millions with the currency. We’re seeing a growing number of people experimenting with living on Bitcoin alone for months at a time while documenting the experience for documentary viewing.
You can buy food in Boston, coffee in London, and even a few cars on Craigslist using Bitcoin. Bitcoin searches increased in 2013 with the April spike and the subsequent fall in the price of Bitcoin. Last week, the first major purchase of a bitcoin company was for online gambling site SatoshiDice for 126,315 BTC (about $11.47 million), from an undisclosed buyer.
This rapid increase in awareness and adoption looks set to continue if confidence in the currency remains strong. Which leads to the second addiction. Government regulation.
Although specifically designed to operate independently of government oversight, Bitcoin will inevitably be affected by governments in some way. It should be for two reasons.
First, to achieve a high level of adoption, Bitcoin must be accessible to a large number of people, and that means expanding beyond hidden transactions to the normal day-to-day transactions of individuals and businesses. Second, these Bitcoin transactions can become a traceable part of people’s taxable wealth, to be declared and regulated along with any other type of wealth.
The European Union has already stated that Bitcoin is not classified as fiat currency or as money, and as such will not be regulated on its own. In the United States, the 50-state system and the number of bureaucracies involved have inevitably made decisions more complex, with no consensus yet being reached. Bitcoin is not considered money as such, but it is treated like money.
The thriving Bitcoin market in the US has a more uncertain future for now, and any eventual legislation in the US could have either a very positive or a very negative impact on the future of Bitcoin.
So Should You Buy Bitcoin?
The answer largely depends on how risk averse you are. Bitcoin will certainly not be a smooth investment, but the potential of this currency is huge.