Companies rely on networks of factories and customers worldwide, including third-party service providers, to help satisfy demand. In addition, Bitcoin has been lauded as an integral part of blockchain technology that will disrupt these supply chains.
But what are bitcoins? They are digital tokens with no monetary value, they can be transferred person-to-person with low transaction fees, and they have become more stable since the financial crisis in 2008 due to bitcoin’s underlying deflationary design. The popular sentiment is that bitcoin will become a leading source of funds for international trade transactions due to its cost benefits and also to trade bitcoin is traceable and secure.
The cost of bitcoin transactions may be low, but merchants, transportation agents, and service providers worldwide are still hesitant to accept bitcoin. Due to the complicated infrastructure involved in a transaction, supply chain transactions take place over long periods of time. The need for archival records and regulatory compliance further complicates the matter.
Bitcoin Blockchain: The futuristic technology:
At first glance, the transfer of funds appears to be very secure, with a remittance network that is much more robust than legacy systems. But it also implies that an intermediary must verify both ends of a transaction before it is considered secure. Finally, but perhaps most importantly, the blockchain is an incredibly reliable transaction record.
In fact, “blockchain” is a misnomer; in reality, it is not merely a ledger – and numerous parties maintain that record. Moreover, this bitcoin ledger’s validity depends entirely on miners’ actions, who may choose to exclude certain transactions from the blockchain. Still, to get incentives, each miner has to put in their computing processor.
There’s no way for a party to disrupt the blockchain because each miner acts as the central ledger. The benefits of having a distributed ledger that’s immutable and can be used across multiple participants are considerable; however, given the current state of technology and small player base within bitcoin’s remittance network, the network will gain momentum in the future and will disrupt many industries including the traditional financial segment.
Bright future of bitcoin:
It’s very safe to say that bitcoin will gain momentum in the future and will disrupt some industries, including real estate, banks, financial institutions, and other sectors still using the traditional payment system. Bitcoin has set out to undermine the modern banking industry by creating a decentralized global currency that people can own and spend without needing central authorities or intermediaries. What was once an experiment is now a fully functional currency that has gained significant traction in the last few years. Many government agencies, including the Federal Reserve, have studied bitcoin and blockchain technology for several years. Although the currency is not yet widely accepted, it has gained a significant following among the young, tech-savvy generation.
Bitcoin’s gradual adoption by large companies like Microsoft, Dell, Virgin Galactic, and Expedia may help convince more people that mainstream users can adopt a decentralized global currency. However, while some of bitcoin’s features are better than traditional currencies in critical areas such as cross-border transaction fees and security, bitcoin still faces a long road ahead before it can be considered safe as a payment system.
How is bitcoin ruling the financial segment as an investment vehicle?
Bitcoin’s use as an investment vehicle is increasing as more companies adopt cryptocurrency. Many experts believe that bitcoin will soon overtake gold as a haven, and many people, including Charlie Munger (Warren Buffet’s friend), have spoken about the potential of bitcoin to increase in value by 2,000% over the next five years or even more.
Early adopters of bitcoin were mainly technophiles attracted by its innovative technology; this group of early adopters is likely to remain bullish, partly because they already hold a significant portion of the available supply.
How will bitcoin gain momentum in the future?
The best way to increase the value of bitcoin is to continue its recent traction and gain more recognition from other big companies. In addition, government agencies in many countries, including the US, Japan, China, and Russia, have a high interest in this new-age technology; governments were encouraged by bitcoin’s decentralized nature and its privacy features.
Today’s transaction is secure and a long-term solution to eliminate the problems associated with traditional transaction methods. Furthermore, blockchain technology is a safe concept for online transactions and has been endorsed by many government agencies worldwide; therefore, it will gain more traction in the future.
How will bitcoin become the future money?
The bitcoin technology is a great concept, but its low scalability and long-term volatility impede its adoption. Nevertheless, blockchain technology will make the world a better place, so many government agencies and large companies have studied it for years to see where they can adopt it into their systems. The future of bitcoin is bright, and bitcoins may become one of the most accepted currencies in the future.
