There is little argument that Bitcoin’s initial rally towards $20,000 was predicated on its growth as an investable asset. The major cryptocurrency came onto the mainstream radar as people realized that it was gaining huge amounts in very little time.
The coin went from being the currency of the dark web to being digital gold – only with gains that had scarcely been seen before. However, by becoming an asset, it drew in a lot of speculative investors, eventually leading to a bubble.
Now, with Bitcoin recovering and not swinging so violently in its volatility, there are debates as to what will be the next catalyst to send Bitcoin on a rally that has been predicted as big as $1 million per coin.
Some feel that Bitcoin will inherently start to grow – and probably at a more stable rate – based on the decreasing supply from the upcoming reward halving, and general principles of supply and demand. However, there are others that are looking to Bitocin to really embrace its utility and head back towards being a functional currency.
However, for Bitcoin to get back to being a digital currency – or a “peer-to-peer electronic cash system,” there needs to be a few changes in regards to the cryptocurrencies scalability. Bitcoin had experienced high network rates before, which slowed transactions right down and pumped their prices too – is ideal for something that wants to work as well – if not better – than Visa and Mastercard.
Time Draper is one such advocate for Bitcoin going back to being a functional digital currency. The Venture Capitalist, who has a soft spot for Bitcoin, said at a Q&A session at the Malta AI & Blockchain Summit last week that the Lightning Network could help Bitcoin’s utility and thus boost its price to $250,000.
“I think Bitcoin payment processors are really going to open the floodgates,” he summarized.
On the topic of why Bitcoin would reach new records within just the next three to four years, Draper continued:
“It’s because of Lightning Network and OpenNode and maybe others that are allowing us to spend Bitcoin very freely and quickly, so that it’s not just a store of value, but it can be used for micropayments; it can be used for retail, it can be used all over.”
There is certainly a sentimental change in the belief of what Bitcoin can be used for at the moment. This, coupled with the evolution of payments, could very well lead may traditional payment processors towards Bitcoin.