After a nasty correction, Bitcoin is back big time. The “people’s currency” has gained close to 1.54% in the last seven days alone, stabilizing around the $9,000 mark.
That’s close to 50% up from its recent lows, an encouraging sign for Bitcoin bulls.
7d Performance of Major Cryptocurrencies
Source: Coinmarketcap.com 5/2/18 at 12.30 p.m.
[Ed. note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment. Disclosure: I don’t own any Bitcoin.]
Will the digital currency ever reach and beat the old high? Some experts think so, provided that three things go in Bitcoin’s way.
The first thing is higher Bitcoin adoption rates as a store of value and as a medium of exchange, two functions common among conventional currencies.
That, in turn, will take a better security infrastructure. “Assuming Bitcoin will be used as store of value going forward (e.g. digital gold), a better security infrastructure overarching the entire crypto ecosystem will be needed for people to place trust in this new financial medium and start using it,” says Christian Ferri, President and CEO of BlockStar. “Once this happens, more people will jump in, so a scalable infrastructure will be crucial. “
While a better security infrastructure will help Bitcoin improve its function as a store of value, it won’t improve its function as a medium of exchange. What will? Protocol enhancements that will stabilize Bitcoin’s everyday value. “If new enhancements aredone to the protocol to allow Bitcoin (or a fork of thereof) to become a medium for everyday transactions (e.g. buy your Latte with Bitcoin), we’ll need a stability mechanism in place, on top of security and scalability mentioned above. This way that Latte won’t cost you $5 today and $50 tomorrow,” adds Ferri.