Cryptocurrency has been one of the most exciting and unpredictable markets to invest in ever since the beginning. The whole crypto frenzy started with Bitcoin being created a decade ago by an anonymous creator who went by the name Satoshi Nakamoto. The increase in the value of Bitcoin since its inscription is what draws many investors towards this digital asset.
Over the years, Bitcoin has seen several phases of developments and just when we think that it is nearly perfect, the developers add some new feature which further increases its usability. The freedom to use one’s own money without being chained by the rules set by the centralized governments makes Bitcoin a very unique asset in existence.
Bitcoin’s unregulated nature is also the main reason for the high volatility that it experiences. This is also one of the reasons why many people don’t favor this new technology. Additionally, the price of Bitcoin is highly speculative and the media can have a major impact on its price trends. However, just like any other asset that you can invest in, Bitcoin also tends to mimic its past price trends.
Over the years Bitcoin has experienced many bear markets and each time it has recovered and has gone on to set a new all-time high. While this has been highly rewardable to the true believers of the technology, it has not favored the faint-hearted highly influenced by the volatility of Bitcoin.
Last year was not very friendly to Bitcoin investors, as the year started with Bitcoin already dropping in valuation. Things went from bad to worse towards the end of 2018 as we saw losses as high as 80% of Bitcoins highest recorded price.
This was the news highlighted throughout the year. However, there was a lot happening behind the scenes for Bitcoin. Let us now have a look at all the major developments that were made to the Bitcoin platform in 2018 and how this is going to affect its value in 2019.
Rebuild Bitcoin- 2018, The year of developments:
All cryptocurrencies experienced the biggest bull run in 2017. This attracted many new investors on to the platform. Bitcoin especially saw a rapid increase in its price. The growing user-base for cryptocurrencies and Bitcoin, in particular, was extremely helpful and the move in the right direction towards financial freedom.
However, the cryptocurrency platforms in existence were never designed to handle such a large number of users. This made it nearly impossible to use Bitcoin on a daily basis.
The slow transaction time and the high fee that one had to pay was the reason for the initial drop in the price of Bitcoin. Even though SegWit was activated in 2017, its effects could hardly be seen in 2018. This led to people believing that Bitcoin cannot achieve mass adoption.
However, no one realized that even though SegWit was active, hardly any crypto wallets were configured to handle the new feature and hence were using the old addresses. As the number of Bitcoin users decreased, the developers joined forces in order to implement SegWit on all wallets on the Bitcoin platform. Thus, we can currently experience extremely fast transaction speeds and at a lower fee.
Another groundbreaking feature that was added to the Bitcoin network is the lightning network technology. Using this feature, Bitcoin can be transferred to another wallet without having to burden the main chain repeatedly.
The lightning network is just under a year old, yet it already has over 5,000 active nodes that you can use to send Bitcoins. The lightning network is a great addition to the bitcoin network as it will let us use Bitcoin on a daily basis. Thus, attracting new people on to the platform.
The massive loss in the value of Bitcoin definitely stole all the attention of the mainstream media in 2018. However, it was also during the same period that we saw a 50% increase in the number of active Bitcoin wallets. This just goes on to show that even though the prices have taken a hit, Bitcoin still attracts many new investors onto the platform.
2018 was a very important year for Bitcoin. As the price of Bitcoin went on decreasing, some of the altcoins tried to question the position of Bitcoin. Two of the most notable ones were Bitcoin Cash and Ripple. The Bitcoin Cash community even started to claim Bitcoin cash to be the real Bitcoin.
However, no matter how hard these altcoins tried, they could never replace Bitcoin at the top. These attempts to dethrone Bitcoin at the top only served to solidify its position. The failure of both Ripple and Bitcoin Cash saw both of them return to their former value. Currently, no other cryptocurrency even comes anywhere close to the position of Bitcoin.
Bitcoin also made its way into mainstream investment platforms.
Many popular exchanges such as CBoE started to design Bitcoin futures. Being available on a mainstream investment platform greatly helped Bitcoin as this helped to bring in all the institutional investors. While we cannot see immediate results for this, the long-term impact that it is going to have is truly magnificent.
Throughout the years, the primary purpose of Bitcoin was to replace Fiat currencies. All governments say this move by Bitcoin as a threat. Many countries even went as far as to ban the usage of Bitcoin in their country.
However, looking at the benefits that Bitcoin has to offer in Zimbabwe, some governments are planning to reconsider their initial decision to ban Bitcoin. Many countries, including the USA, have started to recognize Bitcoin as a legal form of currency; thus, facilitating the mainstream usage of Bitcoin.
The most unnoticeable change that has happened to the Bitcoin network is the reinforcement of the Bitcoin infrastructure. This truly brings out the maturity of the Bitcoin network. Mining is what makes transactions on the Bitcoin network possible.
Mining Bitcoin is very computationally intensive and also requires a lot of electricity. With the decline in the price of Bitcoin, mining is also not very profitable. So, one might expect the total mining power to go down.
However, the total hash power on the Bitcoin network has increased throughout 2018 regardless of the decline in its profitability. This increase in the hash power of the Bitcoin network further increases its security.
Bitcoin was and still is the most secure cryptocurrency network in existence with a hacker requiring an insane amount of hashpower or a quantum computer to launch a 51% attack on the network.
With the added hash power, anyone looking to attack the network would further need more hash power on top of the insanely high amount that he would already need; thus, making the Bitcoin network virtually impossible to hack into. This just goes on to show the maturity that the Bitcoin network has attained
All these events took place over a span of one year. While 2018 can be seen as the year where many changes were implemented, one could expect 2019 to be the year when we see the results of a year-long worth of hard work.
This might turn out to be true as well. However, there is already a bunch of new features that is being developed and slated to be implemented in 2019. Let us have a look at the planned implementations of 2019.
Changes to be Made to Bitcoin in 2019:
2018 has been a very important year for Bitcoin. It was the year when we saw many developments for the platform. It won’t be long before we get to see the result of all this hard work. However, we are also set to see some more features to be added to the Bitcoin network during the course of 2019 as well.
One of the biggest bottlenecks when it comes to decentralized services is the exchanges that we need to use in order to buy some cryptocurrency. However, as these exchanges are all centralized, it defeats the main motive of Bitcoin which is to achieve complete decentralization.
Just like any other centralized organization taking advantage of the current situation, the centralized exchanges do the exact same thing. The trading fee that one has to pay the exchanges is simply too high. With such high fee being collected from the users, centralized exchanges are stripping us off our own money.
There are many decentralized cryptocurrency exchanges that one can use. However, even those exchanges are not free of all the flaws. One of the biggest flaws when it comes to decentralized exchanges is the non-availability of many trading pairs.
As not many traders use such exchanges, the availability of trading pairs is extremely low on the existing decentralized exchanges. Additionally, the fee changed is usually fixed and the user cannot set his own fee on this exchange.
One of the new features that being tested is the atomic swap transaction on the Bitcoin network. With this new feature, users will be able to send Bitcoin to an Ethereum address as well. In such a case, the receiver would receive an equivalent amount of Ethereum in his wallet. Atomic swaps would potentially make all crypto exchanges obsolete and promote a more decentralized way of exchanging cryptocurrency.
With no middleman involved during the conversion process, one would need to pay only the miner-fee for the Bitcoin transaction. Thus, eliminating the unnecessary conversion fee that we end up paying while using the centralized exchanges.
Additionally, atomic swaps will also solve the problem of unavailability of trading pairs as there is no need to have one in this case.
Atomic swaps are by far the biggest and a game-changing feature that is currently being tested on the Bitcoin Testnet. Apart from that, there are also numerous bug fixes that are set to come for the lightning network.
Additionally, many ways to decrease the energy being used during the process of Bitcoin mining are also being researched. We can also see Bitcoin being accepted my more merchants around the world. Especially after the implementation of SegWit that has resulted in the drastic increase in speeds and decrease in fee for Bitcoin transactions.
With the prices stabilized at around $3,800, we can be sure that there is a lot of support from the true believers of Bitcoin, at this level. Thus, all this sets a great platform for the price of Bitcoin to go back up.
The Million Dollar question - Will the price of Bitcoin rise in 2019?
Bitcoin and all the other cryptocurrencies lost a huge chunk of their peak value. This decrease in value certainly tested the nerves of every investor. After shaking off all the people who bought into the network due to the hype, we are currently left with mostly the true believers of Bitcoin’s cause. This is the reason for the support that Bitcoin is getting to the $3,800 mark.
As the price of Bitcoin has stabilized to a large extent, the new features that were added to the network are going to play a major in the future price movement of Bitcoin. With good transaction speeds and lower-miner fee, more people will begin using Bitcoin again. This will certainly help increase the price of Bitcoin in 2019.
That being said, it is still very soon for Bitcoin to return to its former value of $20,000. We will definitely witness a steady increase in the price of Bitcoin throughout 2019. However, we will not be able to see a breakout like the one we experienced in 2017.
The next biggest Bitcoin breakthrough is most probably going to return in the year 2020. With the miner reward halving to 2 BTC per block in 2020, the increase in demand for Bitcoin is going to drive its price to great heights in the near future.
As seen in the past, Bitcoin tends to mimic its past trends. Looking back, Bitcoin did experience a major bear market in 2014 and the prices recovered only in 2016 when the previous miner reward halving took place. With the next halving set to take place in 2020, we will most likely see the price of Bitcoin increase at that time.
So, what’s next?
Bitcoin has been a technology that has seen many developments over the years. As each new feature increases the usability of Bitcoin further, it is also going to attract more users on to the platform.
With extensive developments throughout 2018 and a few game-changing features planned for 2019, the Bitcoin network is surely going to attract more users to the platform. As each year passes by, we are one step closer to the mass adoption of Bitcoin and in turn - a better future for ourselves.