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What's new with Bitcoin? For days, the largest digital currency has risen by $ 3,700. Shortly before Christmas last year, a Bitcoin was worth nearly $ 20,000 at most, as much as half a kilo of gold.
Kryptoland burned. At the height of speculative fever, the 2,000 digital currencies in circulation had a market value of $ 820 billion. Since then, Bitcoin has eliminated other digital currencies. Their total value dropped to $ 120 billion in eleven months – more than $ 700 billion has evaporated.
The usual explanations of why Bitcoin and other important digital currencies such as Ripple, Ether, Stellar, EOS or Monero do not work properly. Of course, the fact that the movement around Bitcoin has split four times since 2017 has upset fans. Similarly, the US Securities and Exchange Commission's tougher approach to digital IPOs – in ICO jargon – with ingenious crypto founders drawing billions of dollars from investors .
A transaction costs up to $ 35
The world of digital currencies suffers from a lack of realism. As Bitcoin skyrocketed, the exhibitors seriously announced that state coins with coins and paper money would soon become superfluous. Credit card companies are an outdated model, the future will be paid with digital parts.
"Rat poison high two": Investor legend, Warren Buffett, is not a fan of Bitcoin. Video: Fox News
Meanwhile, Visa and Mastercard are expected to dominate the money market business for a long time. According to Cointelegraph's industrial service, Bitcoin's computer network processes only seven transactions per second, while Visa generates 24,000 in normal operation and up to 50,000 transactions per second in commercial transactions. In full swing, an agreement with Bitcoin cost up to $ 35, today less than 40 cents – but only because the trade fell to a fraction. A large number of "miners" responsible for the maintenance of the Bitcoin platform have been demobilized because their compensation no longer covers their costs.
An additional solution called the Flash network must now allow Bitcoin to catch up in terms of speed and stability of transactions compared to Visa or Mastercard. Until Bitcoin is as convenient as a credit card, just like credit cards, developers of the solution would mitigate expectations, in months or even years.
The hard core of followers points out that Bitcoin is above all a way for them to preserve their values in times of crisis – as a digital substitute for gold. But the precious metal is currently also in low demand. The price of gold is $ 1,200 an ounce, more than a third less than the peak reached in 2011. Bitcoin has lost much more value – 75% since the beginning of the year.
The development of Bitcoin / US dollar since the launch of cryptocurrency shows one thing above all: huge fluctuations. Source: Business Insider
In short: Bitcoin will not be an inexpensive and convenient means of payment, nor digital gold in the foreseeable future, as fluctuations in the value of Bitcoin are even more brutal than those of the precious metal itself. , And now disappointed, as they suffered similar losses with their counterparts with Bitcoin.
Ethereum in Zug is far ahead of the competition
The main problem with cryptocurrencies, however, is that they do not have a viable business model. Credit card companies do not earn much money with transactions, but with debit rates. Facebook was a huge flop after the IPO of 2012. That's only when the platform made it clear to investors that they were making hay with ads that the stock has been bought. Today, Facebook represents nearly $ 390 billion in stock market, more than three times more than the combined 2,000 digital currencies.
Google's mother, Alphabet, is worth $ 730 billion, thanks to billions of ads. Where Google does not make money with users, but with companies that advertise. The search for such a sophisticated economic model will probably have more priority in digital currencies since the mass landing of speculators.
In this regard, Ethereum, the digital currency platform domiciled in Zug, far outstrips Ether, Bitcoin and other competitors. Its founder, Vitalik Buterin, has positioned Ethereum as an open solution from the start, where other suppliers can offer a variety of solutions. The lion's share of young cryptography companies, which have in part collected tens and hundreds of millions of people through a digital IPO, is using Ethereum as a platform.
Many of them are swimming in money but know little about it. Most of them have not gone beyond the cloud promise stage and pilot tests. Only a few are active in the market with a functional product. A murderous application for the mass market is far away. It still takes until the victory of "the Internet of money".
(Editors Tamedia)
Created on: 27.11.2018, 22:10
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