Bitcoin has had a triumphant year this 2016 reaching a milestone market capitalization of over $15 billion during the end of December. It’s nice to mention that the digital asset has been one of the top performing currencies worldwide, beating many commodities as well. But what’s really worth pointing out is this phenomenon has happened without governments, corporations, or any central authority.
Also read: Remittance-Demanding Countries Dominate Bitcoin Searches in 2016
The Black Swan Event
Bitcoin came along shortly after the global economy crashed in 2008, with central banks printing vast amounts of fiat reserves and bank bailouts becoming a common sight. It’s been over eight years since the genesis block was released into the wild and bitcoin has come a long way. At first, the digital currency wasn’t taken very seriously but over time people curated the cryptocurrency’s value by using it as a medium of exchange. In the early days, one notable transaction was the purchase of two pizzas for 10,000 BTC.
As bitcoin continued to gain value over the years there have been many ups and downs. Mainstream media continuously portrayed the digital asset in a negative way and exchange losses like the Mt. Gox bankruptcy didn’t help much. But bitcoin shook off all the bad press and showed that it just didn’t care. Over the course of a few more years, bitcoin’s underlying technology, the blockchain, became the focus of traditional market incumbents.
While Central Planners Fail, Bitcoin Shines
However, while “blockchain” was hyped by the current banking cartel, bitcoin’s public block chain [Satoshi’s original spelling, Editor’s Note] continued to shine as an investment vehicle and economic safe haven. Many countries worldwide have been suffering from capital controls directed by authorities, and hyperinflation spurred by central planners. Bitcoin has helped many around the globe circumvent these economic problems by letting people utilize it as a peer-to-peer digital asset. Towards the end of 2016, bitcoin’s popularity and price value had increased significantly, becoming one of the best investments of the year.
There are many reasons to why bitcoin has done so well. But the foundations of the digital asset’s value can be found in the fact that it is decentralized, peer-to-peer and open source by its very nature. This is why demand is so strong when countries like China tighten capital controls because citizens find a way out with bitcoin. When India demonetized certain rupee denominations, residents have flocked to bitcoin to battle the cash crisis within the region. Furthermore, in countries like Venezuela suffering from hyperinflation, residents have found solace in bitcoin’s current store of value.
Besides economies worldwide dealing with hardships, the cryptocurrency has brought forth vast amounts of innovation. Concepts like smart contracts from the likes of Rootstock are being built, and social media applications such as the Yours network promise new applications for Bitcoin. Alongside this, there are now many reputable exchanges and wallet providers creating different ways to trade and store bitcoins more safely. Bitcoin’s innovative technology has given new meaning to decentralized governance, voting, and a great variety of subjects that affect our lives. Bitcoin has produced the means to accomplish these ideas in a whole new way.
Don’t Worry, You Can Still Participate, Bitcoin Is Just Getting Started
The digital token has come a long way since gaining parity with the dollar, silver, and once again approaching the value of one ounce of gold. There have been many times bitcoin’s price has corrected where many considered it a crash. But stability has gotten considerably better over time and the cryptocurrency suffers way less from volatility. No one is quite sure how governments and central banks will deal with bitcoin in the future. We know that authorities are trying their best to craft regulations and enforce rules against certain use cases. However, the community is creating various ways for bitcoin to be more fungible and less trackable by state and non-state actors.
The milestone of bitcoin’s $15 billion dollar economy is great because there is no technological innovation quite like bitcoin. It’s the first medium of exchange of its kind to reach this feat and will continue to test society by changing the financial precedent worldwide. The rise of bitcoin is more evolutionary than we can imagine and it’s just getting started.
What do you think of Bitcoin’s phenomenal rise over the past eight years? Let us know in the comments below.
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