Why Bitcoin has no value (Why Bitcoin prices have not skyrocketed)

08/17/2023 12:04 • Metaverse Matters • 69 views

Why does Bitcoin have no value? Why does Bitcoin have no value?

The core of blockchain technology is the use of cryptography and blockchain technology to record transactions and transfer assets in a distributed system. And this is exactly the flaw of Bitcoin.

If a project wants to fundamentally change the existing monetary system, it must consider its “fundamentals”. The reason Bitcoin has the above advantages is because it does not rely on a single central institution or entity to verify the authenticity of the account book (such as electronic cash).

However, this trust assumption has not been realized-because no one can know what these numbers look like; and because everyone is running their own nodes and owning their unique data, these cannot be confirmed. And such a mechanism will allow many malicious participants to use resources on the network to attack or deceive, making it difficult for people to control their own funds, so they are easily targeted by hackers.

This is the question we often hear: “Why did Bitcoin lose its value?” The answer is very simple.

For most investors, “price fluctuations are too great” and “market risks are extremely high” are the most common ideas, but the fact proves that these issues do not apply to ordinary consumers. “Cryptocurrency is a speculative tool”, because its design purpose is to avoid manipulation, not as a means of payment. Although there are many decentralized networks that can make Bitcoin more efficient and scalable, there are also some exceptions that may limit the development direction of BTC.

The price of Bitcoin is easily manipulated, just like other anonymous coins such as Monero. However, according to data from CoinMarketCap, the total market value of the global cryptocurrency market is currently about 2 trillion US dollars.

However, despite this, Bitcoin still has many flaws. First: Bitcoin cannot solve all problems; second: lack of consensus. Over time, the demand for blockchain protocols is increasing; third, the security of blockchain still needs improvement; fourth, Bitcoin is vulnerable to a 51% attack.

In order to ensure the security of Bitcoin and prevent potential economic losses, some exchanges have shifted a large amount of transaction costs to miners.

In fact, one of the biggest selling points of Bitcoin is its limited supply. In addition to mining Bitcoin, there are many factors that may affect the use of Bitcoin.

1. Mining difficulty is low, because it consumes a lot of energy; 2. The power consumption of mining machines is low, and the energy efficiency is higher; 3. There is an excess of mining farms, and electricity prices are cheap; 4. Network congestion.

In recent years, solutions such as the Lightning Network have appeared in the market, including Ethereum, Litecoin, etc.

Why Bitcoin prices have not skyrocketed

In the past two weeks, the price of Bitcoin has remained around $10,000 for several consecutive days. However, due to recent market selling pressure, many people believe that the price of Bitcoin will rebound significantly again (if it can break through 10,200), but this is not a good phenomenon.

According to data from Coinmarketcap, since February 19, the total market value of Bitcoin has dropped by nearly 10%, while Ethereum has fallen by about 20%. In addition, the last time Bitcoin fell by 7% was in March. Therefore, when investors buy Bitcoin, the price of Bitcoin will rise and start to rise-because Bitcoin traders usually use it as an investment target. However, for those who want to invest in Bitcoin, they actually have no opportunity to enter this industry. Because of this, the sentiment and liquidity of the cryptocurrency market seem to be becoming very bad. Although some analysts expect Bitcoin to skyrocket or further decline, there are also other factors that may drive Bitcoin prices back to their previous highs. (Bitcoinist)

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Why Bitcoin has no value (Why Bitcoin prices have not skyrocketed)

Why Bitcoin prices have not skyrocketed

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