When bitcoin was first created in 2009 nobody anticipated how powerful it would become. Most analysts predicted that it would collapse, and not even the optimists expected it to grow at such a rapid pace. Those who were “foolish” enough to invest early are now reaping the rewards.

But even though bitcoin has defied the critics many times over, the future of the cryptocurrency is still hotly debated. While many analysts still believe that it will one day fail, the majority have changed their tone and are either predicting continued growth, or at the very least, sustained value.

Bitcoin has been hitting milestone after milestone, and is now peaking at around $6500 per bitcoin (November 2017). However, according to CNBC presenter, Jim Cramer, the market cap is still yet to come and could exceed one million dollars within the next decade.

Why Bitcoin Is So Powerful

Bitcoin is a universal currency that’s owned and controlled by the people. Therefore, there is no financial organisation or central government calling the shots. People and businesses benefit by being able to transfer money anywhere in the world without being subjected to poor transfer rates. But there could also be humanitarian benefits as well. John Smith, senior analyst at online financial service Elogbookloan.uk has even stated that bitcoin could help the two billion unbanked people of the world by enabling them to acquire finance and capital.

There are also many other reasons why the world needs to embrace a user-controlled, universal currency, such as the ability to place merchants in control or the ability to bypass excessive bank charges. The rapidly increasing value of bitcoin could also create an additional back-end income stream that could become extremely lucrative.

Bitcoin Valuation Is Problematic

The problem with bitcoin valuation is that we’ve never seen anything like it before. With stocks you consider potential future earnings; with bonds it’s the ability to pay back investors; and with currencies, it’s the relative value to other currencies. With bitcoin, however, there is no benchmark or regulated market to compare it to. Therefore, when analysts draw valuations and potential valuations based on other models, they will always be wrong.

According to The Street, bitcoin’s value is linked to the perception of value. While it’s a strange concept, providing people continue to believe in bitcoin, its value will increase. While it’s not quite there yet, it could eventually become the universal currency (as in a currency that’s in daily circulation) that the world so desperately needs.

The Future Of Bitcoin

There are now 5.8 million bitcoin users out there, and the numbers are increasing daily. In addition, many of the world’s most successful businesses are starting to take it seriously. Microsoft, Overstock and PayPal already accept it; AirBnB are expected to add a “bitcoin accepted here” logo to their header in the comping months; and even Uber has expressed interest. When retailers, such as Amazon, start adding it to checkouts you can be sure that the other smaller players will follow in their footsteps. And when/if that happens, the whole industry will undoubtedly explode.