The Growth of Bitcoin

The advance of technology has left room for all kinds of innovations in the cyber community. One important phenomenon that stands out is the appearance of cryptocurrencies. These are currencies which solely exist in their digital form, and bitcoin is definitely taking the lead in this regard.

Nowadays, it is quite easy to sell and buy anything using bitcoin, or even exchange it for a real-life, fiat currency. Its secure transfer system and unique technology allow people to play blackjack or roulette at online casinos, order a gadget from an online store or simply send money to a loved one. The reasons behind the rise of all these opportunities are just as varied.

During the past month, bitcoin has witnessed its greatest rise in value as it went slightly over $2,900. Moreover, the currency is also experiencing its longest run with a four-digit value. One of the major factors which brought about such exponential growth in bitcoin’s value is the fact that the Japanese government officially recognized the cryptocurrency in April. This prompted the two major uses of bitcoin – as a means of transferring money and as a means of extortion for ransomware.

Several local money transfer services have recently started processing greater volume of transactions. The main surge is due to people going abroad to make a living for themselves and their families. They find this transfer service much cheaper and faster than standard companies like Western Union or MoneyGram. Migrant workers from China and the Philippines located in Japan have made great use of this system.

Still, this is only a minor fraction of the global money transfer traffic or the bitcoin transaction variety. An even greater influence on bitcoin’s rise in popularity and thus in value is its use in ransomware. This is specific software used to hack into people’s computers and practically encrypt all their data, demanding a bitcoin payment in order to reverse the process. Criminals worldwide are using it to hold people’s computers hostage, which resulted in an even greater number of bitcoin transactions. Another illegal use for this cryptocurrency which can severely damage its reputation is noted on underground websites and services which sell illicit substances – drugs, weapons etc.

The major reason why bitcoin has managed to get involved with such a bad crowd is its decentralized nature. Its transactions are encrypted with high-end technology and processed through its system known as blockchain, leaving no tangible traces behind. However, with the legalization in Japan, bitcoin is bound to undergo major security measures in order to ensure greater supervision of all transactions.

All that is left to wonder is whether the price will continue to rise or plummet. The two previous booms in 2011 and 2013 were much smaller in magnitude and primarily prompted by USA markets, which makes the current situation that much more certain. In the words of Isaac Newton, “What goes up, must come down”, and everyone’s excited to see bitcoin’s trajectory.