Yesterday, (16 December 2020), Bitcoin finally crossed the $20,000 threshold for the first time ever, not only that, but the cryptocurrency also managed to reach a new high of $23,587. Bitcoin in recent months has solidified itself as a serious investment class with more influential financial institutions and endorsing the crypto-currency as store value or as digital gold.
Bitcoin reached a new high as a result of high demand and it has become attractive to investors due to the potential returns. Its resistance to inflation, as well as ease of mobility or transfer and the expectation that this may still be the very beginning for bitcoin, has also contributed to its attractiveness. Recently major institutions like SGX, MassMutual, PayPal and Square’s CashApp have all promoted bitcoin and even started selling coins to their clients.
Now that bitcoin has surpassed the $20,000 mark, it has validated itself as a real player in the investment markets and is projected to reach even higher valuations in the coming years. Bitcoin is now projected to reach $36,602 by 2021 according to Kraken Crypto Sentiment Survey for the second half of 2020 (Kraken is one of the world’s largest crypto exchanges). Other Cryptocurrencies like Ethereum and Ripple are also expected to make future gains right along with bitcoin.
From a South African standpoint, bitcoin is currently valued at R347,163 according to South Africa’s prominent crypto-wallet and exchange platform Luno. What bitcoin’s rise means to South Africa and the World is a strong indication of the future of money. As the world moves more toward the digital realm so will money, assets and anything of value that can be digitized.
Bitcoin also has a strong role to play in forming a global cashless society, and blockchain will be the framework from which the internet, finance, investment and banking and any service that requires verification and recording. Bitcoin still has its detractors but as its value continues to increase and it manages to overcome its challenges its detractors look more uninformed and afraid of change.