Cryptocurrency, BlockChain, Digital Currency; these are the most circulating words these days in the financial echelons. The talk of the town! Bitcoin, LiteCoin, and Ripple in other corners. With the introduction of e-wallets and online payment systems, BlockChain technology found a big market for its propagation and eventually, a practical solution for safe money keeping in digital form.
Quick History Recap For Cryptocurrency
To say that Cryptocurrency is a recent innovation would be far from the truth. Actually, this idea was coined as far back as the nineties, when even online payment was not even dreamed of. It was attempted to develop digital money but the project hit the snag and wasn’t realized at that time. (BlockGeeks) An interesting fact about Cryptocurrency that most people don’t know is that it is a side product of another invention and was not intended to exist in the first place. Satoshi Nakamoto is the founding father of Bitcoin while all he intended to develop was “A Peer-to-Peer Electronic Cash System”. Rest is history and now cryptocurrency has emerged as a global phenomenon. (BlockGeeks)
Rise and Fall of Cryptocurrency
Lately the trend has changed, however. There are plenty of companies who are using this digital currency to make novelty sales now and then and many businesses are built around this new sensation. (Valenzuela, 2017) A chaotic trend has taken over the crypto coin market. The coins known to be safer investment are taking blows from lesser known coins which have taken the top 10 spots in ranking overnight. (Valenzuela, 2017) For instance, due to some technical issues, average time taken by Bitcoin transactions has escalated in the last few months; taking 168 minutes to 145 minutes in March. While on the other hand, Ripple is just taking 3.7 seconds which is costing it just $0.00031 per transaction as compared to $0.48 for Bitcoin. (Bovaird, 2017)
Is It Speculation or New Coins Are Just Spectacular?
According to some market hawks, the rise of Ripple manifests speculative market activity. And according to Jacob Eliosoff, a Cryptocurrency fund trader, Ripple has benefited from speculation travelling in the market and sudden interest of some big wig to buy it and the rest followed suit.(Bovaird, 2017) This is just one instance of speculative trading that proves to be elixir for many dying projects. That’s the beauty of speculative market activity. Some speculators start throwing their money in some random coin that comes their way. Other investors follow this money trail and considering it a successful venture, start investing in a project which was abandoned and left for dead. The project comes alive and has a fairy-tale ending. (Valenzuela, 2017)
Is This Speculation Good or Will It to Be ‘Cryptonite’ For Your Business
Cryptocurrency market now is living example of speculative trading and an investment that can make you a billionaire or the other way round. And that’s what happens with investments for which, one should be mentally ready. Speculative market investment is done with the knowledge of the risks involved at the back of investor’s mind, at all times.(Staff, 2017)
In the long run, however, it is not considered beneficial for the business. Businesses flourish in stable and non-volatile environment and investments like these cannot guarantee your safe future. For the traders who are in it for fun, won’t be affected as compared to those who invested their whole life to take a shot at entrepreneurship.(Valenzuela, 2017)
The other side of the coin
Still, there are always two sides of a coin, and one must refer to both in order to have balance in one’s decisions. Although, this speculative trend in Cryptocurrency investment has created quite a buzz in commercial circles, having mixed reviews about its returns after major investment influx in it by serious as well as casual investors; it is the cause of major interest and excitement. This kind of excitement always proves healthy for businesses. Speculative market activity instils life in new ventures and provides opportunities to new developers and users. And as they say, you learn from your mistakes; so whenever there is a bad investment, the result gets you thinking about the real sound venues where you should have invested in the first place. So that, the next time you start a new venture or plan to invest in any project, you are better educated to know about its viability. (Valenzuela, 2017)
Bibliography
- Valenzuela, J. (2017, May 20). CRYPTOCURRENCY MUST ADVANCE PAST SPECULATION. Retrieved May 26, 2017, from Dash News: https://www.dashforcenews.com/cryptocurrency-must-advance-past-speculation/
- Bovaird, C. (2017, April 06). Use of Speculation: What’s Driving Ripple’s Price to All-Time Highs? Retrieved May 2017, 2017, from Coindesk: http://www.coindesk.com/use-or-speculation-whats-driving-ripples-price-to-all-time-highs/
- (n.d.). What is Cryptocurrency: Everything you need to know [Ultimate Guide. Retrieved May 26, 2017, from Blockgeeks: https://blockgeeks.com/guides/what-is-cryptocurrency/
- Staff, I. (2017). The Future of Cryptocurrency. Retrieved May 26, 2017, from INVESTOPEDIA: http://www.investopedia.com/articles/forex/091013/future-cryptocurrency.asp
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