To be able to understand where could be the scope of Bitcoin in the future, the criptomoneda leader, you need to take hold even more in their bases, to then grow exponentially in every sense. Personally, when someone argues that “Bitcoin can’t be money because nothing supports it”, I replied with another question: can you tell Me which supports the money that we currently use? Usually after several hesitation, I explain to them that we have spent almost half a century using money without any support. Clarified that the Fiat money has no backing of any value, but trust us on to continue using it, I explain to them that the real backing of Bitcoin is the technology, the blockchain. And I’ll explain that when we buy satoshis in reality we are buying technology. A young technology, which allows you to transfer value in the network and that its support is in the solutions of complex mathematical operations that allow its functioning. Although, the majority continues not to understand me; I know that the problem lies mainly in that ignorance of collective swarming through the air, not knowing what the hell is the money. But that is another very broad issue that we leave aside. For this reason, in this article I want to share briefly what I consider are the essential points to the fundamental strength of Bitcoin.
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It is about the third reduction of Bitcoin, which could spur more demand
Without a doubt, one of the main determinants of demand that affect the price of Bitcoin is its limited supply. Bitcoin is designed to be a currency deflationary with a total supply that will never exceed 21 million. To achieve this, the reward in the block for the miners of Bitcoin decreases by half every 210,000 blocks or approximately four years, is what is known in the slang crypto as halving. Until now there have been two reductions and after each event of reduction, the price of Bitcoin sees a substantial increase with the staying power and the strong lines underlying resistance. It will probably be more dramatic this time, as there are many more eyes on Bitcoin that when they occurred the other halving. It is estimated that the next will occur between April and may of 2020.
The hodlers of Bitcoin increased at a record number
Record number of outputs of transactions that are not spent on the chain of blocks. That means that more people than ever are buying Bitcoin to hodl. As we have discussed on several occasions, the political predators in the that moves the global economy, such as interest rates, even under zeros, the quantitative easing of the FED, the trade wars, the debt and voracious economic sanctions to different nations, have been the bitter taste, which has motivated many people decide to “try Bitcoin”. And this can be seen, since the accumulation of Bitcoin has been strong in this 2019. Even by the expectation of the entry of the institutional investors, each and every day there are more people who save or invest their money in Bitcoin. Since then, also in developing economies with currencies are very unstable. But even as more people buy Bitcoin, each time less people selling Bitcoin for a profit. With transactions that are not spent reaching new records, the number of hodlers of bitcoin is at its highest point.
The Blockchain of Bitcoin
Of computing power. Bitcoin hashrate of The Network Bitcoin is, in my opinion, the main source of data for fundamental analysis. Because it gives us a visual idea of the strength of the network by means of its Hash Rate. The rate of hash is the number of calculations that a particular hardware or network can perform each second. Therefore, a higher hash rate in the network indicates an increase in the amount of resources required to perform an attack of 51%, which makes the network more secure. In the same way, it is a very important parameter for the miners, because the more hash rate will increase your chances of solving the mathematical problem, and to seal up the block and collect your reward. Currently, your hash rate, has exceeded its historical records, which makes the network more robust and allows more confidence to investors which will drive the demand for Bitcoin; as stated by Max Keiser on Twitter some weeks ago. “Price follows hashrate and the graph of the hashrate continues in its bull market, 9 years.”
Active developers per month has remained stable
Ecosystem of developers of Bitcoin I have to say, despite the fact that Bitcoin does not have the promotion, and even the sponsorship of a company to cover the costs of the new projects implemented by the developers, the ecosystem has retained the interest and support from different groups for their growth. According to a report from Electric Capital, revealed that the number of active developers of Bitcoin per month has increased from 106 in January of 2014 to 314 in January 2019. Developers are responsible for the networking enhancements that help to maintain security, reduce transaction fees and increase the capacity of Bitcoin. In conclusion, we can say that the research that is now taking place and the developments being implemented to the network, will have a positive impact of long-range, but it is possible that we don’t understand the implications complete this work for some time. It is noteworthy that the software engineers, academics, technology companies and users are being caught up in the ecosystem of Bitcoin and each time will be more. The fact that we have seen a growth even in times when the price crossed the “crypto winter” seems to suggest that there is much more interest in the technology of Bitcoin that simply an exaggeration of prices. The following two tabs change content below. Engineer, lover of economics and technology; Convinced that Blockchain will empower them to future generations, giving them freedom and sovereignty to each individual.