What the future holds for Bitcoin and digital assets

“Those who do not remember the past are doomed to live it again” 

                           George Santayana, American philosopher and writer 

An acquaintance of mine from St. Petersburg, Andrey, once decided to make money on BTC. He started buying Bitcoin back in 2013. Then the coin cost no more than $ 100. For several years, a friend of mine was able to buy four BTC. Then for Andrey it was just a hobby.

When Bitcoin climbed to the $ 4,000 mark, Andrey bought some more BTC. We managed to make money on this again, because bitcoin continued to grow! Against the background of such successes, Andrei could no longer restrain himself. He became obsessed with buying the first cryptocurrency..

An acquaintance of mine decided to sell his St. Petersburg apartment in order to buy even more bitcoins and definitely become a dollar millionaire. Andrey sold the apartment, and he began to rent a house.

And then 2018 came and a sharp drop in the BTC rate began. Andrei had to sell coins at a loss in order to pay off the accumulated debts. Now he still has bitcoins, but they certainly will not cover the losses associated with the sold apartment in St. Petersburg..

Unfortunately, there were a lot of stories like Andrei’s at that time. It is important for us to remember them so that this does not happen again in the future..

What issues will be covered in the article?

In this article, I will briefly touch on the history of bitcoin. I’ll tell you how the first cryptocurrency began to grow sharply in the second half of 2017. How then throughout 2018, BTC fell, and in 2019 it began to rise again. How it now revolves around the $ 9K mark.

I’ll tell you about the current situation and the problems of miners. About what cryptocurrency laws will be adopted in Russia and the world. I will analyze why bitcoin grew in 2019 and whether there will be a new takeoff. How Bitcoin returns to its former power. Finally, I will tell you what caused the current behavior of BTC, growth disease or speculations of large players..

The content of the article

  1. A few words about the past of cryptocurrencies
  2. Trade war as a driver of Bitcoin growth
  3. What’s in Russia?
  4. Russian cryptocurrency bills
  5. What’s in store for cryptocurrencies
  6. Digital currency is becoming commonplace
  7. Prospects for cryptocurrencies in Russia
  8. Should I go headlong into cryptocurrencies?
  9. Conclusion

A few words about the past of cryptocurrencies

After a sharp short rise in the second half of 2017, Bitcoin began to fall. In the second half of 2018, the owners of BTC were in a real panic. This is not a joke – people lost 70% of their savings (actually even more)! It was not only the owners of cryptocurrencies that suffered. Mining also became unprofitable.

Bitcoin mining with ASIC

On average, a miner who earned $ 1,000 a month in 2017 was only able to generate $ 200 at the end of 2018, or even less! It was not possible to beat off even the cost of electricity.

As a result of the fall of 2018, according to some estimates, almost 95% of investors in digital currencies remained in the red. Most likely, the funds were saved only by hedge funds, which are used to playing for a long time and the most desperate holders who began to buy Bitok at the dawn of the cryptocurrency boom..

However, since the second quarter of 2019, the situation has changed, the demand for mining devices – ASICs – has gone up the hill again and even a shortage of devices has appeared. In just three months, starting in June, there have been connected 600,000 new miners. 

Many again believed in the best, good news appears, the rate is growing. The news background changed a lot, and people began to discuss such large-scale projects as the launch of delivery futures for cryptocurrency on the Bakkt platform, the creation of Libra from Facebook and Gram from Telegram, the launch of the Chinese digital yuan. “.

However, everything turned out to be not as simple as we wanted..

Trade war as a driver of Bitcoin growth

The current reason for the rise in the price of bitcoin is related to China and the United States. If the trade war continues, then the price of bitcoin will rise. In that sure analyst and director of the private investors website ADVFN.com Clem Chambers.

The US-China trade war is undermining investor confidence in traditional financial instruments. Stocks, dollars, euros, yuan – all this looks somehow unreliable against the backdrop of US sanctions against China and complications between the US and Europe .

Of course, against this background, digital currencies are seen in a new light. They can even be called a “safe haven” for capital. Of course, Bitcoin is still a high-risk asset. But where is calm now?

Chinese Yuan to US Dollar rate

The chart above shows that since 2018, the Yuan has drawn about 14% against the Dollar! Therefore, for the Chinese, bitcoin has become a real defensive asset against the backdrop of such a fall..

The Americans, on the other hand, were able to go into the shares of their companies, into the dollar and other proven assets. So it’s not for nothing that China is called the engines of cryptocurrency progress..

Clem ChambersClem Chambers

Clem Chambers, a cryptocurrency market analyst and CEO of ADVFN, agrees with this opinion. He mentioned a similar position in forecast Bitcoin, made by Forbes. In the same place, he confirmed that his target benchmark for Bitcoin is around 50,000 USD..

What’s in Russia?

And in Russia, they are in no hurry to adopt legislation in the field of digital currencies. In 2017, against the background of the unprecedented growth of the crypto market, the government frantically began to develop new bills. Currently, cryptocurrencies are still prohibited from using for settlements in the country. So you can only dream of buying coffee for bitcoins..

In the summer, some State Duma deputies promised that parliament would consider cryptocurrency laws this fall, but things are still there..

Anatoly Aksakov

And recently the deputy Anatoly Aksakov stated, that the State Duma will not have time to pass the law on digital financial assets before November 1. At the same time, he promised that a compromise on the regulation of cryptocurrencies could be found..

In general, the Russian authorities have a poor understanding of what cryptocurrencies are and are not ready to rush to legalize them. Apparently, the authorities have not even decided yet whether it is worth accepting digital currencies at all, or it is better to simply ban them, as they did in China. For example, the Russian Central Bank a year ago considered cryptocurrencies as a harmful phenomenon, and now, on the contrary, expresses its loyalty.

Elvira NabiullinaElvira Nabiullina

Head of the bank Elvira Nabiullina now reasoning that the country can create its own national digital currency. It is supposed to be pegged to gold or the ruble. However, while the head of the Central Bank sees “many risks and few advantages” in the digital ruble.

Russian cryptocurrency bills

Digital rubleDigital ruble

It is worth mentioning what laws the cryptocurrency community of Russia will have in the future. This year, the State Duma decided to start legalizing digital currencies. The concept of “digital law” was introduced into the Civil Code. It is enshrined in the law No. 34-FZ. This means that the emergence of cryptocurrencies from the shadows has already begun. The law will come into force in December. It also defines important concepts such as smart contracts and blockchain..

As I said above, this year the MPs also plan to consider several more crypto-laws in the first reading. The rules for the circulation of cryptocurrencies, investment and ICO will be determined. Major innovations:

  • bill No. 419059-7, which describes digital financial assets, buying and selling cryptocurrencies,
  • bill of 11.07.2019, introducing experimental legal regimes for digital innovation.

All these laws will allow the Russian cryptocurrency sphere to develop more freely and will even contribute to the introduction of innovative financial technologies into the Russian economy..

What awaits cryptocurrencies in the near future?

Experts predict both a fall in bitcoin and its growth.

Trofim EremenkoTrofim Eremenko

For example, Trofim Eremenko, managing partner of VINT Consult, member of the Board of the Association “Support and Development of Cryptocurrency and Blockchain Technologies”, considers, that by the end of the year, bitcoin together with altcoins will show positive dynamics. May grow to $ 15k.

Omkar GodbowlOmkar Godbowl

In turn, CoinDesk Markets analyst Omkar Godbowl considers, that the market is now showing signs of a bearish reversal. So, for the first time since February 2019, the MACD indicator fixed on the weekly chart below zero is observed. This, according to the expert, means that Bitcoin may fall below the psychological mark of 9 thousand dollars..

It is worth noting that in early November 2019, China lifted the ban on mining as a business. It will also have a beneficial effect on the cryptocurrency space. Economic Planning Agency under the State Council of China National Development and Reform Commission (NDRC) presented the final version catalog “Guidelines for industrial restructuring.” According to the document, which will enter into force on January 1, 2020, the PRC refuses to prosecute miners and fight against crypto mining..

Digital currency is becoming commonplace

In Russia, new laws are being adopted that should bring cryptocurrency out of the gray zone. In other developed countries, digital currencies generally become a part of everyday life. Many people in the US and EU are already comfortable paying with bitcoins in cafes, museums and hotels. Ordinary Americans have wallets to pay their bills. Rednecks buy Ethereum and Bitcoins for their grandchildren for birthdays. Even seniors are starting to invest their savings in the cryptocurrency industry.

People just got used to the new digital reality. For their part, governments are trying to take control of cryptocurrencies. There is no need to prohibit, it is enough to create a clear legal framework and voice clear rules of the game in the industry, and it will start to be useful.

The majority of the state will follow this path. Experts are confident in this.

In general, digital currencies are becoming an important phenomenon from outsiders of economic development. True, it is still not clear what the potential of digital currencies is. Obviously, the situation with Libra, Gram and the “digital yuan” have become precedents. And how the story is resolved with each of these projects will show us the nearest prospects..

Should I go headlong into cryptocurrencies?

Investing in cryptocurrenciesInvesting in cryptocurrencies

Now many are trying to understand whether Bitcoin has really become a promising asset? Is it worth waiting for another fall like the one that happened in 2018?

Tom LeeTom Lee

Fundstrat analyst Tom Lee previously predicted a rise in the price of BTC in 2020 to $ 91 thousand. He has done a lot of analytical work and focused on the cryptocurrency chart over the past nine years. He recently stated on the appearance of “positive signals”:

“Over the past few days, there have been many positive signals:

– China’s friendly policy towards blockchain.

– New maximum of the S index&P 500.

– Bitcoin Misery Index is being restored.

The time for asset Risk-off (Gold, US Treasury bonds – author’s note) has passed, and the bull market has resumed. “.

John McAfeeJohn McAfee

John McAfee sure, that by the end of 2020, the price of bitcoin will rise to $ 1 million. He urged not to pay attention to weekly fluctuations in the first cryptocurrency rate.

Cryptocurrency expert and trader Roger Quantrillo considers, that by the end of this year, bitcoin will cost more than 17 thousand dollars.

Conclusion

Buy cryptocurrency or not? The final decision is made only by you.

You can focus on the opinion of experts, traders and analysts, but if something goes wrong, all the risks will be on your side, and the sad story with Andrey is a good example of this..

Of course, blockchain is a very promising technology that will become an important part of society. With the popularization and development of blockchain, almost every person on the planet will have an idea of ​​the cryptocurrency market. All experts unanimously agree on this opinion..

In general, John McCaffy, Roger Quantrillo, Tom Lee, Clem Chambers and many other experts are confident that Bitcoin will grow in the next year. This is indirectly confirmed by the processes of regulation of the cryptocurrency market around the world and the keen interest of large corporations in this technology, not to mention such projects as Libra and Gram..

Everything new causes rejection and resistance. This is a normal reaction of society, which is inherent in us by nature itself. Blockchain and cryptocurrency technologies are completely new phenomena, the mass distribution and adoption of which has yet to be.

Therefore, answering the question whether there are prospects for bitcoin and other cryptocurrency assets: The answer is unconditional – Yes!

Will cryptocurrency become a by-pass thing? The answer is also yes!

Should I go headlong into cryptocurrencies? Andrey’s example says – No!

Don’t forget about the risks and treat cryptocurrency as a long-term investment. Any expert will confirm these words..

“In life, you always gain something and lose something. Be happy and cheerful when you win. Don’t regret losing and don’t regret it. Never look back – you still cannot change the past. But I try to learn from his mistakes “.

                                                                             Richard Branson, founder of the Virgin Group.

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