The primary players will determine how quickly the Bitcoin sector develops, and legitimacy growth surges will likely occur.
To support the secrecy of the currency, Satoshi Nakamoto, a Software Developer with the pseudonym Satoshi Nakamoto, had to design something new, which is when Blockchain, the digital record of Bitcoin transactions, was developed.
Cryptocurrencies initially appeared in 2009 with the creation of the world’s first decentralized money, Bitcoin. The original concept of cryptocurrency was to establish a safe and anonymous mechanism to move money from one person to another. Since then, its value has surged, and it has been dubbed “digital gold” by its users.
Shortly after, Ripple, a real-time gross settlement mechanism, was developed. The currency itself is designed to allow for near-instant and direct money transfers between two parties. Any cash, from fiat money to gold to airline miles, may be traded. They promise to avoid the costs and wait periods associated with regular banking and Bitcoin transfers via exchanges. It has grown so popular in the industry that banks worldwide are now utilizing it.
Introducing something new to the market takes a little while until it’s replicated, and Bitcoin was no exception. Rival cryptocurrencies first appeared on the market in 2011, with Litecoin, Namecoin, and Swiftcoin, to name a few. This is hardly unexpected given that the Bitcoin currency now has a market value of US$44 billion. As a result, new cryptocurrencies are created daily by Software Developers worldwide, all aspiring to become the next Bitcoin star. While 2017 witnessed the most significant increases in value across the hundreds of active Cryptocurrencies, they have yet to infiltrate our daily life. Most people who possess substantial quantities of Bitcoin do so as an investment rather than to use the money as a new method to buy stuff online.
After an incredible surge in 2017, 2018 witnessed a different tale. The market imploded and plunged by 65%, leaving newbies to the market unsure whether it could ever recover.
In addition to the existing payment system, the blockchain public ledger technology (which underpins cryptocurrencies) can disrupt a wide range of transactions. These include stocks, bonds, and other financial assets for which records are held digitally, and a trusted third party is now required to verify transactions.
The bitcoin market will evolve at the rate dictated by the main participants, with expected growth spurts of legitimacy from one or more participants in “credentialing moments.” Each of the five primary market participants—merchants and consumers, tech developers, investors, financial institutions, and regulators—will advance the industry to the next stage of development toward general acceptance and sustained expansion.
According to the analysis, the emergence of cryptocurrencies heralds the start of a new era of technologically driven markets that could upend traditional business models, regulatory paradigms, and market strategies, all to the advantage of consumers and greater macroeconomic efficiency. Cryptocurrencies have the revolutionary potential to open up a worldwide payment system to consumers, one in which participation is only limited by access to technology rather than by things like having a bank account or a credit history.
