Will Bitcoin Continue to Go Up
Bitcoin has been on an incredible journey over the past decade or so. It started as just another meme-like cryptocurrency that wasn’t worth anything and now it’s one of the most dominant cryptocurrencies out there with a market cap exceeding $1 trillion dollars for several months running.
But what exactly makes this digital currency rise above all others? Why does everyone want their money invested in such a popular asset class like BTC? And more importantly, will its popularity last? Let’s take a look at everything you need to know about BTC and how it compares to other alternative coins. We’ll discuss some of the factors that will play a role into whether or not will Bitcoin continue to go up.
Here’s Why Bitcoin is the Best Cryptocurrency
Bitcoin Market Cap is Nearly 1 Trillion USD
First off, let’s get into the nitty gritty of which cryptocurrencies are currently dominating the industry. According to CoinMarketCap, the top five largest currencies by total value (market capitalization) include Bitcoin ($89 billion), Ethereum ($41 billion), Ripple ($17 billion), Litecoin ($8 billion), and Tether/USDT ($7 billion). This means that these companies make up roughly 90% of the entire crypto space right now.
While this may seem overwhelming, bear in mind that many people have no idea where any of these coins originate from nor do they understand how each coin works under the hood. As long as someone wants to buy them, then demand exists regardless of how useless they might be. However, if we break down those numbers even further, we can see that only two major competitors exist within the larger group. The competition emerging in the space plays a role in will Bitcoin continue to go up.
Ethereum and Ripple account for around 40 percent of the entire crypto market while BTC accounts for 50 percent. If we were to compare these figures against traditional markets, Apple would represent 30% of the smartphone market, Google represents 20%, Samsung 15%, Amazon 10%. In comparison, Bitcoin accounts for nearly half of all active addresses globally.
This level of adoption cannot be ignored when considering why BTC dominates almost every aspect of the cryptocurrency world today. While other coins certainly offer different use cases than Bitcoin, none have proven themselves capable of reaching anywhere near the same levels of success.
Another interesting point to note is that Bitcoin’s network hashrate recently surpassed 100 quintillion hashes per second (PHash/s)—that’s 100 million times faster than Visa!
According to BitInfoCharts, Bitcoin’s hash rate rose 3,000x since August 2020 alone—a staggering figure especially given that this metric hasn’t increased significantly since November 2015. What does this mean for us? Well, this shows us that the developers behind BTC aren’t slowing down anytime soon. They’re going full steam ahead with new features and improvements.
As far back as 2011, Bitcoin already had a 1 megabyte block limit—the current standard being 32 MB blocks (or approximately 4 terabytes). This size limitation restricts transactions to low amounts of data rather than limiting overall throughput across the network. So, why did they choose this number? A lot of thought went into this decision, but the main reason ended up being practicality. Since miners compete for rewards based on hashing power, having smaller blocks reduces wasted energy costs because small transactions don’t require as much electricity to verify.
In addition, BTC uses a Proof-of-Work mechanism instead of Proof-of-Stake consensus methods seen in newer projects. This allows users who contribute less computational effort to mine Bitcoins without receiving rewards. Instead, they must wait until someone else solves a hard problem before cashing out. Miners still receive transaction fees, however, depending on how quickly they confirm your payment.
One thing to remember is that mining difficulty adjusts itself automatically according to supply and demand. Therefore, the amount of work required to solve problems changes regularly. Difficulty increases whenever miners generate too many solutions, making it harder and costlier for newcomers to enter the game.
On average, solving a single block takes 2 minutes due to high CPU requirements. Once solved, though, the reward becomes 12.5 BTC—worth close to $50,000 USD at press time. Now, consider that fact that Bitcoin has produced billions of tokens during its lifetime thus far. All of which are completely worthless unless someone decides to hold onto them. But how could anyone ignore such a massive payout?
Finally, Bitcoin also offers something called “segwit,” short for Segregated Witness and abbreviating Bitcoin Improvement Proposal 144. SegWit is essentially a software update that enables better scalability through bigger blocks and eliminates signature malleability once again. Without segwit, Bitcoin would never reach maximum capacity, resulting in higher prices and longer confirmation times for transactions. Will Bitcoin continue to go up is something miners and investors alike are watching.
Why Is Bitcoin Dominance Important?
To put things simply, Bitcoin is king. Not only is it the biggest player in the cryptocurrency space, but it also commands the lion’s share of attention from investors and media outlets alike. Even mainstream services like Twitter and Reddit dedicate significant portions of content to discussing Bitcoin price movements, news, scams, etc.
When looking at other altcoins, it’s easy to assume that they should perform similarly to Bitcoin, but this isn’t necessarily true. For instance, Ethereum, despite holding the #2 spot on our list, doesn’t come close to matching Bitcoin’s daily trading volume. Furthermore, Ethereum’s growth potential seems limited compared to Bitcoin’s.
Notably, Ethereum aims to become a platform for decentralized apps (dApps) similar to Apples iOS vs Android model. In order to achieve this goal, Ethereum needs to grow exponentially, whereas Bitcoin is merely trying to maintain its position as the de facto leader. Although both Ethereum and Bitcoin aim to fulfill very distinct roles in the future, neither project appears interested in becoming a direct competitor.
Bitcoin Adoption by Institutions is Growing
With Bitcoin remaining unchallenged as the leading cryptocurrency, it’s difficult to imagine that its popularity won’t survive. After all, its creator Satoshi Nakamoto himself said he planned to create a worldwide monetary system that eventually replaces fiat currencies entirely.
However, plenty of obstacles lie between BTC and achieving this dream. One barrier standing in Bitcoin’s way is blockchain bloat. Currently, Bitcoin’s mempool contains hundreds of thousands of unprocessed transactions waiting to go through. Until this backlog clears, users will experience extremely slow speeds and potentially unreliable service.
Additionally, the Lightning Network concept (basically an overlay network built upon Bitcoin) suffers from scalability issues. This means that it can’t process payments fast enough for certain applications such as micropayments. Lastly, regulatory bodies haven’t yet embraced Bitcoin fully, meaning that businesses and individuals must jump through hoops to operate legally using this technology.
Despite these drawbacks, Bitcoin remains the gold standard among cryptocurrencies. Its underlying principles remain unchanged from year to year, allowing developers to focus on building innovative products instead of constantly changing codebase fundamentals. At least for now…
So, now you’ve got everything you need to know about Bitcoin and whether it deserves to rule the roost. Hopefully, after reading this article, you’ll feel confident enough to start investing and earning big bucks with BTC. Will bitcoin continue to go up is something to study and keep an eye on.
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