The story of humanity is a story of development, advancement, and adaptation. From being naked, according to the biblical account of creation, to wearing clothes made of grass, to the clothes we wear now made of cotton, linen, nylon, etc. From hunter gatherer societies where man gathered and hunted what he needed (food and clothing), to commercial societies that advanced through trade by barter, to trading with currency, where we are now. Silver, bronze, gold, paper money, and now digital currency. Humanity and human society is constantly changing. Is cryptocurrency here to stay?
A hundred years ago, humanity’s technology was very crude in comparison to the technology available now. Take it back a further 100 years, and the fact is the technology that was available in the 19th century was way behind what was available in the 20th century. Now take it further, 100 years from now, can you imagine the change and advancement? The point of this, is to not rule out the permanency of cryptocurrency. 30 years ago, the internet was still a new and not very popular technology. Fast forward to the final years of the 20th century, and there was literally a gold rush for internet companies – what is known today as the dotcom boom. There were many internet companies listing on stock exchanges, and people buying into the hype of the internet. At the end most of these internet companies failed. They failed because at that point in time, internet had not been widely accepted or adopted yet. But a number of the few that survived, are giants today. Amazon is an example.
New inventions or creations naturally take time for society’s adoption and acceptance, if ever that will happen. Overtime people got used to the internet. To shop online and get the package delivered to their door (or pickup). To meet new people (I can guess you met many of your current friends online). To play games. To stream movies and songs. To make payments. To do a lot, basically. It has now become a way of life. Living, working, and recreation are heavily reliant on the internet.
Will the same happen to cryptocurrency? A certain answer cannot be given, as no one knows the future and what it will bring. What will be important though, is what cryptocurrency will be used for. An asset class? An exchange tool like paper money? Or both? For now, the rave about cryptocurrency is it being an asset class, to make investments in and/or trade with, and make gains. Will you take a bet on cryptocurrency as an investor/trader, or will you not?
Personally we at Smart Assets believe that cryptocurrency is here to stay. Why? Because the blockchain technology most cryptocurrencies are made of is definitely here to stay. Blockchain had made the transfer of money very easy. Yes, the transfer of money today with the internet is not difficult. You can use your bank’s mobile app, or financial technology platforms like PayPal. However these systems are closed systems, coming with fees that are often high, control that could get you banned, and slow (sometimes the money is sent to the recipient in days). In contrast, blockchain is an open, decentralized system. With cryptocurrency, it is now possible to pay anyone anywhere in the world instantly (literally in seconds), no questions asked. It is unstoppable, and any attempt to take it down would require taking down the whole internet!
Blockchain allows you to send cryptocurrency to your friend in Australia, in only seconds, from your personal computer in Texas. You can send any amount of money you want to across borders, no questions asked. It is not a problem to send $1,000,000 using cryptocurrency. With cryptocurrency, you are your own bank. Back to this question; will you take a bet on cryptocurrency as an investor/trader, or will you not? The most important thing is to do your research and let it guide your decision making. An advice is not to rush into it for the sake of it, or to hit gold in a gold rush. Crypto has also gone through a bubble, reaching an all-time high of $19891.00 for a bitcoin in December 2017. It crashed below $4000 for a bitcoin in November, 2018, almost a year after. Taking a bet on cryptocurrency means taking a bet that cryptocurrency will be widely accepted and adopted years from now, both as a currency and an asset class. That people would use it to buy and sell, and invest and trade in/with. Should you decide to dare, and invest in bitcoin (after doing your study and deciding bitcoin is here to stay), give us at Smart Assets a chance to help you manage your cryptocurrency investments.