Skyfall: Why this isn’t the end of Bitcoin
By Nikita Kosmin
The December events have raised a question that has been on everyone’s lips for a while? How volatile is cryptocurrency? What happens when the existing infrastructure that deals with cryptocurrency starts showing signs of weakness?
The question of Bitcoin’s volatility has been subject to speculation pretty much since its stellar rise to unseen heights which allowed people in the know to get 15 times richer in a relatively short space of time.
It took a lot of processing power and resources to handle Bitcoins as well as some expensive tech. That you will know very well if you’ve had your sights set on the GeForce GTX1080 NVidia video card for ages and someone swiped the last one off the shelf right in front of you in a shop so they can mine Bitcoins.
There were also questions of what would happen when inflow and outflow of cryptocurrency would increase and the Bitcoin-based economy starts to pick up speed exponentially so that the best HDDs start to feel like floppy drives when more and more sophisticated machinery is needed. Is the humankind ready for cryptocurrency? Can we really predict its rise and fall or even control it in any way? Is Bitcoin a virus or a cure?
· We’ve seen scientists claim Bitcoin will never rise again over the $1000 mark (if only they saw the charts in December when it cost beyond $16 000).
· In May 2017 it has lost over $4 000 000 000 in value after a 20% drop from $2,791 to $2,179 .
· With predictions of it reaching the $60 000 the Bitcoin suffers a spectacular dive in December, sending the cryptocurrency world on fire.
Now the genie is out of the bottle, it can’t be stopped, predicted, or controlled, but what will it do to the economy? Cryptocurrency with its anonymity is a perfect tool for criminals and money launderers. Its decentralization, on the other hand, can help anyone who wishes to alter the open code and build the world’s first 100% see-through and legitimate vote — or better yet, the world’s first fair democracy.
With a decentralized system, there would be no changing the data without other users’ knowing and agreement, guaranteeing incorrigibility and immutability of actions. Blockchain would allow users to build a system with 100% integrity, which would mean a political system that by definition could not be corrupt.
In a sense, the cryptocurrency technology could alter the very way the society operates — from a smart house that fills up on milk when it runs out without asking the owner, to creating a brave new world. No wonder the recent events with Bitcoin crashing and losing a large part of its value have attracted so much interest from the community.
Saxo Bank claims Bitcoins will reach a peak of $60 000 and then suddenly crash back to $1000.
“The Danish investment bank foresees that Bitcoin mania will find “the rug was torn out from under it” as Russia and China move to the sideline and even prohibit non-sanctioned cryptocurrencies domestically” — Says The Telegraph.
George Soros, one of the most famous macro traders in the world, states that the Bitcoin will have a “flat top” rather than breaking sharply.
“Normally when you have a parabolic curve, eventually it has a very sharp break,” Soros said Thursday. “But in this case, as long as you have dictatorships on the rise you will have a different ending because the rulers in those countries will turn to Bitcoin to build a nest egg abroad.” (from Moneyweb). And neither of those scenarios seems very likely at the moment. So what is happening with cryptocurrency? Is this the beginning the biggest crash in the history of humankind? Will the cost of Bitcoin come down the “production cost” of $1000 as Saxo Bank claims?
The Bitcoin market is subject to may fluctuations, all or most of which can be calculated to a reasonable degree. There are patterns that you will see if you’re in the know, and on the whole, the market is largely influenced by certain events which you can track if you’re aware of what is happening in the world (likу some countries making cryptocurrency legal, thus providing more demand). It is also true that the recent Bitcoin dive has a lot to do with the current capacity of Bitcoin exchanges to process transactions. Some of them have closed down, creating understandable consequences. The famous UK-based CEX.io stopped new user registration just before the collapse, using the statement:
“Every day, an enormous number of users registers on our exchange, which we are extremely excited about,” the company wrote in a blog post dated December 21. “At the same time, this has been putting additional pressure on our support and verification teams.” (from Business Insider UK who also states that “global cryptocurrency markets are now seeing daily trading volumes similar to the New York Stock Exchange.”).
Now, handling volumes of information this great is bound to get some companies cracking at the seams. “Currently, we’ve come to a point when the number of tickets submitted to our support team became critical.” — Pointed out CEX.io in December.
There is no doubt the workload is becoming difficult for the infrastructure on the whole. Kraken has issued a statement saying: “Performance is extremely degraded and unreliable. Clients can expect severe latency and difficulty interacting with all web and API services. Requests will frequently timeout and fail. At the moment, the only solution is to wait and try again later.”. MT Gox experienced the same problem with new users overload a few years ago.
Now, when we said that the question of having the resources and infrastructure to handle Bitcoins has been relevant from the beginning, we meant it was just a matter of time until a critical mass was reached. The question now is whether the market will bounce back, ready for even larger volumes of clients and more transactions.
So what happens now as the Bitcoin falls in price and many people are selling and even more people are trying to consider the aspect that we for one have been pointing out for a while: vertical scalability?
The fall in price was subject to discussion long before the recent fall in price took place: since its conception, Bitcoin presumed huge resources required to handle it and interest by investors that would increase dramatically and exponentially, making system overload pretty much inevitable. Geektimes discussed the critical mass issue back in 2016.
The Guardian’s Will Hutton believes “Bitcoin’s technology could transform the world”:
“In the way that Facebook, Amazon, Netflix, and Google (the “Fangs”) replaced conventional media and communication companies, that prospect faces banks, insurance companies and many public services…Just as the web once promised freedom, so does blockchain. The chain is self-policing. Anyone who attempts to launch an exchange of data outside the protocols of the chain will immediately be spotted by the other blocks — and the exchange will be aborted. Suddenly, the world has acquired a system for the fast, trusted exchange of vast amounts of data.”
As we see, this is in part a problem of technology. It is clear that the blockchain network has staggering amounts of potential with its fast and trusted technology that knows no geographical or in some countries legal boundaries. To say that cryptocurrency is a powerful weapon would be to say nothing. And just like any weapon, if it ends up in the wrong hands, it can do a lot of damage.
We’re sure that the key to controlling the technology wisely is selecting the right company that will be able to vouch for the integrity of service. As we have already said, the business in many markets who are still struggling with the concept of regulation has shady future prospects, to say the least. You want to know who you’re doing business with and whether the goods and services have any value and what the experience of other clients has been so far.
In that way, the only and best way we’ve seen of making sure the standard of quality is on the right level is cross-referencing customer reviews.
Revain in this sense can be the best possible intermediary between parties that may or may not trust each other because they provide exactly what this unsteady market needs right now, which is integrity, trustworthiness and quality checks.
This platform, which is solely based on maximizing the see-through-ness and reliability of companies and services, has a fantastic future in countries in the world all over — from investors who don’t know whether the companies they are dealing with can be trusted to large corporations who want to start using a new service and aren’t sure how valuable users will find it.
When it comes to investing large funds, the topmost priority is knowing who you do business with — and who better to verify the integrity than a platform that has been built with that exact purpose in mind?
Revain with its token built specifically to stabilize the current transactions could not only benefit largely in this rapidly evolving but still morally quite an ambiguous market, but make the world much more stable, honest, and see-through. It has been sticking firmly with its roadmap so far and providing fantastical real-life results. And if we are to see a real democracy finally taking place, Revain has the technology and the resources to make that happen.
As The New Scientist describes the world where honesty is immutable and incorrigible thanks to the blockchain tech — “this is the beginning of a democratic system that transcends national borders”.