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Is This the End of Bitcoin?

by Kylie Nebeker 4 years ago in bitcoin
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Some Thoughts on the Cryptocurrency

I woke up Thursday morning with several articles of interest to read, all about Bitcoin and the impending doom on the finicky cryptocurrency. How it went from $10,000 to $9,450 all in a matter of hours.

In fact, Google reports that BTC right now is worth a surprisingly low $9,385. Failing to keep it's value at $10,000. The market last year had surprisingly grown from $800 per coin in value, to a near whopping $20,000 this last December, making a few new wealthy hobbyists.

The market has had a incredibly rough start this new year as it has lost around $133 billion in the markets. The media points out many reasons for this, from the lack of effective leadership in the market, to the bias and confusion it holds for new investors, and even pressure from the U.S. government.

In the article by Omkar Godbole on the site "CoinDesk" it is estimated that the value of the coin will be around 8,900 by the end of today. What does all that mean for the little guy?

Bitcoin is what experts like to call an economic bubble. Just like Beanie Babies - it's a fad, a hobby. Just that this hobby includes complex mathematical formulations instead of cute physical objects. Though many supporters of the cryptocurrency would say that it is more than just a hobby. In the words of Mike Hern, one of Bitcoin's leading developers; "Bitcoin is an experiment."

The Bitcoin experiment introduced the world to a new technology, blockchain. Which was a faster, more secure, way of sending money. But as it is said, the winners of the game are not always "first," especially when it comes to economics. New coins, like Ethereum or Ripple have improved upon the original concept and are now making their way onto the market - Ether coins now just under $1000.

It is more than likely that Bitcoin will continue to spiral downward for a while. But just like many things on the internet Bitcoin is fickle, and it may just surprise us.

Seeing that the cap for mining is close at hand, it is hard to predict what will happen, there could be a huge spike in value as the only way to get bitcoin - will be to trade for it. Seeing as the mysterious founder has a stash of a million or so coins, there could be a inflation. For me, this is unlikely as it would most likely go the opposite way and fizzle out. People tend to hoard value rather then sell and trade as illustrated in Paul Krugman's 1998 Column of the Babysitting co-op. Much of the same is likely to happen when the last 20 percent of the currency is mined. Which would cause a liquidity trap.

Because of the cap, it is proving to be less effective to mine for the coins, unless you are a corporation. For the little guy, I caution to avoid mining. It is faster and eventually, with luck, a lot more cost effective to buy coins at low cost rather than using this high-cost mining services, especially with the price dropping so quickly.

It is possible that new investors may want to consider investing what they can afford to lose on these low-priced coins, while diversifying their portfolios to new coins and other assets to prevent fallout. Waiting for the short lived spike of value once the cap is reached, or the slow fizzle that will undoubtedly happen. Optimistically, but carefully looking forward to the future of this economic bubble.


Godbole, Omkar (2018, Febuary 1). "Bitcoin Sinks Below $10k Following $133 Billion January Loss." URL:

Hearn, Mike (2016, Jan 14) "The resolution of the Bitcoin experiment" URL:

Reiff, Nathan (2017, June 8) "What Happens to Bitcoin After All 21 Million are Mined?" URL:

Stark, Elena (2017, Novemeber 23) "10 Reasons Why Bitcoin Will Fail" URL:

Gobry, Pascal-Emmanuel (2013, April 5) "This 1998 Paul Krugman Column Perfectly Explains The Design Flaw At The Heart Of Bitcoin" URL:


About the author

Kylie Nebeker

A young writer who is just a bit obsessed with her pet Betta Fish, Kaen. Who loves to swim, and illustrate novels.

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