How Big Is Bitcoin? Is Bitcoin In A Bubble?
So Bitcoin huh the significance of Bitcoin and what it represents is different depending on who you ask some say it is a currency others say its an asset class to invest in and others still view it as a wealth transfer from old monetary system to new monetary system legally it’s not even clear to regulators what Bitcoin should be classed as despite this there’s been a huge mania around the cryptographic currency recently so what it is roughly speaking Bitcoin is a new form of secure currency that doesn’t need a bank government agency or any middle man to operate the people within the system just carry out transactions among themselves in what’s called a decentralized network.
Today’s I’ll blog write about size and rapid growth of bitcoin one of the fastest growing assets in all of assets history.
- HOW BIG IS BITCOIN?
Firstly how many bitcoins are there, there will only ever be 21 million bitcoins in existence currently 16 millions of those 21 million coins have been out in the circulation when bitcoins market crossed 100 billion dollars in October of 2017 it had a market value larger than GOLDMAN SACHS MORGAN STANLEY BHP AND NETFLIX.
Bitcoins market cap today is over 300 billion dollars at the time of writing it’s currently around 17 thousand dollars a coin there’s no way knowing where it’s gonna be by the type you read this but we’ll just go with those numbers for now-
Right now it’s about 40% size of APPLE and 72% the size of AMAZON but bitcoin doesn’t compare to cold at only about 3% of that assets or the value of the total US Dollars in circulations bitcoins current market cap is bigger than the GDP of Ireland and Pakistan and the energy consumption to mine bitcoins globally is more than all of these countries it takes a staggering 14,000 kilowatt hours to mine one Bitcoin since its start in 2009 Bitcoin is the 6TH most circulated currency in the world it’s estimated that about 14 million people around the world hold Bitcoin there are 13 million users on the coinbase the biggest Bitcoin exchange and they’ve tripled the users since the start of the year in fact at some points during December coinbase was signing up 20 thousand people per day.
The Winklevoss twins yes the very same one’s who claimed that Mark Zuckerberg stole their idea of facebook are now the first Bitcoin Billionaires they bought 11 millions dollars of coin in 2013 at around 260 dollars per coin in December 2017 bitcoin was launched in the futures market bursting it straight into the mainstream financial world.
I think banking institutions are going to take advantage of this they’re gonna try and smash Bitcoin in their favor I really wouldn’t be surprise get on the phone with their buddies push up the price and when they’re getting ready to dump they’ll let their friends know and make bets ahead of time to make a huge profit this is obviously just my opinion and just a hunch but I think it’s quite likely, central banks are also taking note the Federal Reserves just did a paper about Bitcoin and the blockchain and they’re researching into their own closed version the Reserve bank of Australia is also talking about their own form of cryptographic currency.
- IS BITCOIN IN A BUBBLE?
So it’s a Bitcoin a bubble I personally think most probably to see why it’s worth looking at how the bitcon user base has changed over time the early adopters came in four categories.
-The first group were just Geeks-
They thought the idea of using the computer to generate currency was a neat idea back in 2010 a home computer could make a decent amount of Bitcoin at 5 cents a coin.
-The second group for ANARCHO-CAPITALISTS-
Usually anti-government these guys love the idea of decentralized and pseudo anonymous currency that was completely outside the debt-based central banking system.
-Another group of Criminals:
These guys also like the anonymous nature and would spent Bitcoins on sites like Silk Road to obtain a illegal items like firearms and drugs.
-The final group of libertarians:
Who appreciated the idea of a limited amount of bitcoin as opposed to the central banking method which could print as much as they like when they felt like it the libertarians didn’t like central bank’s and looked at old fat fiat currency with a sense of suspicion these four groups were enough to get the ball rolling on Bitcoin and in those early years the price was more or less stable as time went on the price gradually began to increase for various reasons and people and the news media began to take notice then that brings us to today where a lot of the mainstream adopters don’t really understand what bitcoin is all about usually it goes that they’ve heard about it on the news and they just hear about people making money and see the price going up and they want it on the action.
It’s a natural human instinct but it also it can be classified as speculations and massive amounts of speculation are one of the hallmarks of a bubble but on the other hand Bitcoin is a little different currently Bitcoin is less than 0.1% the value invested in all other major assets this technically means that there’s a lot of room to grow it’s also a easier to get into the bitcoin than stock trading so this bubble could go for longer than most people might expect I ultimately think thank bitcoin is not going to be the cryptocurrency to lead them all another cryptocurrency is going to to come along that has a better technical performance that will probably knock Bitcoin off its throne in the years to come but anyway that’s just me thinking out loud and I think this whole thing is very interesting another worry is the deflationary spending problem because the price of bitcoin keep rising people are going to hoard it and treat it like a form of digital gold instead of currency this will cripple the means of aspect of bitcoins until the price stabilize all no it’s pretty insane how one Coin was just five cents in 2011 and that became worth $800 at the beginning of the 2017 and $17000 near the end of 2017 it is pretty remarkable so anyway that’s it so that’s a bit about the size of bitcoin and some other interesting aspects about it.
I hoped you learned something from this blog and thank for reading.
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