Bitcoin saw a severe drop in value of over 8.5 percent on Wednesday. This was followed by a slight bounce back and is now valued at 5,410 USD. These fluctuations were caused by statements made by the US Commodity Futures Trading Commission in a report called "CFTC Primer on Virtual Currencies." The report stated that they have jurisdiction over virtual currencies including Bitcoin. This is causing fear amongst owners that regulation will make Bitcoin more difficult to use and may loose value. That being said, it is still valued extremely high and reached a record point last Friday.
Bitcoin allows for fast transactions without the use of a broker or bank. This could save people a significant amount of time and money and could benefit the economy greatly. This would allow for increased national saving and allow for increased large transactions and business investment. If Bitcoin can avoid serious issues it could play a huge role in the future of U.S currency. It will be interesting to see what kind of regulations the U.S government will place on this currency and to see just how popular it becomes.
https://www.cnbc.com/2017/10/18/bitcoin-plunges-nearly-9-percent-on-fears-of-greater-oversight-from-us-regulators.html
I think that additional future regulation of Bitcoin is inevitable. From what I understand Bitcoin is largely used on the dark web. The asssociation with the illegal activity taking place on the dark web and bitcoin being used to finance it anonymously is not going to fly for much longer. I would imagine that bitcoin will take a hit when additional regulation happens. Hopefully it will find a way to recover and be applicable in other markets because i think it is an interesting concept.
ReplyDeleteIt is going to be interesting to see how bitcoin will deal with all the future regulations that they will face in the future. The biggest issue it faces is the amount it is used on the black market/dark web is enormous and I don't know how they are going to decrease that.
ReplyDeleteIt's already possible to use Bitcoin to buy certain goods and services (if you're wealthy enough to hold some). But the question is whether it meets the criteria for the functions of money--especially as a stable store of value and unit of account. Bitcoin can be subject to volatile swings.
ReplyDeleteThis should be seen strictly as a buying opportunity. Bitcoin tonight is at 6,000 dollars. With price support around 5,800 and a psychological resistance line just at 6,000 we should see another increase in the near future until we test resistance at 6,200. Once we get past this we should see more resistance at 7,000. However, this is purely speculative. We could see fluctuations for a period of time until bitcoin gets more press.
ReplyDeleteI feel like owners of this currency are always fearful and if they are not, they probably should be. Without government insurance of your funds, Bitcoin will always be volatile. Centralized banking has worked pretty well so far.
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