Every time Bitcoin makes a huge jump in value, it makes the news headlines. But in case you are dabbling in cryptocurrency investing or are planning to jump into it any time soon, whatever events have already occurred tend to matter little to you – they are in the past. Although past events are a good indicator of what is to come in the future, they are but one of the many; hence, these alone are not enough to make the right calls.
The nature of investing requires adapting your mindset. Instead of thinking in terms of ‘guaranteed’, you should be looking for what is ‘likely to happen’. Below, we will discuss 3 important aspects of cryptocurrency that are likely to impact its outlook and future value:
Lawmakers around the world have entered a heated debate on whether cryptocurrencies should be regulated, and if the answer is yes, how they should approach it to begin with. The goal of regulation, of course, is to make cryptocurrency less appealing for nefarious purposes such as extortion, money laundering, tax evasion, etc.
At the same time, following the model of China that simply declared it as illegal one day is probably not the most desirable path to take. In the US, nothing indicates that a ban is coming any time soon, although the move is not completely off the table. What is clear, however, is that laying out the proper foundation for cryptocurrency taxation would create another way to fill the government coffers.
- Crypto ETF
The New York Stack Exchange has already welcomed the first Bitcoin ETF, thus attracting a new wave of cryptocurrency investors who are looking for a more traditional way to make their investment. Since many of them already have an account with highly-regarded brokerages like Fidelity or Vanguard, this allows them to bridge the gap with ease.
Traditionally, to make any significant profits with crypto, investors had to fork over a significant amount of capital and keep it tangled inside for a prolonged period of time, a practice otherwise known as ‘HODLing’ (a play on the word ‘holding’). But thanks to services like SmartCredit.io, they can broaden their crypto portfolio by taking out crypto loans and use their existing assets, including cryptocurrencies, as collateral.
- Broader adoption
Years ago, the idea of paying for your gas or groceries with cryptocurrencies seemed laughable at best. But now, an increasing number of companies like AMC are warming up to the concept of accepting cryptocurrency payments. Another example is PayPal, a well known payment processor. Through its platform, the users can easily convert their funds into Bitcoin.
Given how both acquiring and spending cryptocurrency seems to be getting easier year by year, this is projected to have a positive impact on its overall value. If at any point a big-name retailer such as Amazon were to accept it, this would likely set off a chain reaction of other smaller retailers following suit.
Is Bitcoin headed towards global adoption?
Although cryptocurrencies have a bright future ahead of them, the general rule of thumb is to stick to established crypto coins such as Bitcoin and Ethereum. Although there is money to be made in the so-called alt coins too, many view such investments as much riskier in comparison.