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The figures come from the average forecast from 27 out of 42 experts surveyed by Finder. The UK comparison site polled 24 fintech specialists, including Coinmama CEO Sagi Bakshi, CoinFlip Founder and Chief Advisor Daniel Polotsky, and University of East London Senior Lecturer Dr Iwa Salami. 

CoinFlip’s Daniel Polotsky gave forecasts in line with the panel average and anticipates that Ethereum will be worth $4,000 by the end of 2021 and, by 2030, will have skyrocketed to $64,000. 

“Ethereum's price largely follows Bitcoin's halving cycles, although that relationship may begin to decouple as time goes on, and as Ethereum continues to develop use cases that Bitcoin cannot achieve. Then, its price may grow at a faster rate than Bitcoin's,” Polotsky said. 

However, both Martin Fröhler, CEO of Morpher, and Pedro Febrero, RealFevr’s head of blockchain, expect Ethereum to top $10,000 by December 2021. “Ethereum has the potential to power the future global financial infrastructure”, Fröhler commented.

93% of the panellists said they believe Ethereum will one day become more frequently transacted than Bitcoin. Nearly half of the panellists (48%) predicted that this shift would occur before the end of 2022.

Online financial services giant PayPal has increased the amount of cryptocurrency users can purchase by five times, and is scrapping its annual purchase limit of $50,000. PayPal’s vice president has said that the changes will allow users to have greater choice and flexibility when purchasing cryptocurrency on PayPal’s platforms. 

The financial services giant first began allowing users to purchase cryptocurrencies in October 2020, later adding the option to buy bitcoin via its mobile payment app, Venmo. There is a $1 dollar spending requirement on the product, which allows users to share crypto purchases via Venmo’s social feed. 

When the move by PayPal was first announced, it was considered a substantial step in bringing digital assets to mainstream buyers. However, since April, bitcoin has lost around half of its value when it reached an all-time high of around $60,000. Despite El Salvador becoming the first country to adopt bitcoin as a legal tender back in June, cryptocurrencies have recently faced substantial criticism and opposition, particularly from the Chinese government

 Given the mass amounts of information available and the complex nature of Bitcoin investment, it’s completely understandable that you’d be a little confused. However, now is the time to say goodbye to disorientation and hello to a diversified investment portfolio. Read on to discover your perfect introduction to investing in Bitcoin.

 What Is Bitcoin?

Bitcoin is a type of cryptocurrency that was created in January 2009. It promises investors and traders lower transaction fees than traditional online payment platforms. Additionally, it is operated by a decentralised authority, making it starkly different from government-issued currencies. Like all forms of cryptocurrency, Bitcoin is intangible, meaning there is no physical coin you can use; instead all of your Bitcoin funds are held in a digital wallet.

 Where And How Can You Use Bitcoin?

Despite the fact that it’s an intangible and largely unofficial form of currency, you can use Bitcoin to purchase goods and services from several companies. Some of them include:

Once you grow into a more confident investor and trader, you can also use Bitcoin in your Forex trading activities.

Risks Of Bitcoin

Like any form of investment, Bitcoin investment carries its fair share of risks, of which you need to be aware before spending your hard-earned cash. Some of the most prominent risks include:

How To Buy Bitcoin

You feel ready to invest in Bitcoin, and now all that’s left to do is figure out how to buy some. First, you’ll need to choose an exchange, such as Gemini, Coinbase, or Kraken. There are several exchange platforms on the market, so be sure to do your research and compare your options to find the best one for you.

Next, you’ll need to link a payment method to your exchange account. This payment method is what you’ll use to purchase your Bitcoin. From there, you can place your order for as much Bitcoin as you’d like. Once you have it, make sure to store it in a safe place, such as your digital wallet.

As a beginner, investing in Bitcoin can seem daunting, but it doesn’t have to be. By reading this guide, you’ve taken the first step in overcoming your investing fears and mastering Bitcoin. With this knowledge, you’ll be poised to reach new investing heights.

Satoshi Nakamoto's whitepaper from 2009 would forever alter the global financial sector, spawning an investment that would outperform anything else the market ever saw. Bitcoin's meteoric rise from a few pennies to about $34,000 has been nothing short of a wild ride, bringing riches to some and bankrupting others. Cryptocurrencies are not for the unprepared, so knowing when to purchase and sell is important. This article will cover the definitions of shorting and longing Bitcoin, followed by methods that will answer the questions: how can you short crypto?” and “how does longing work?"

What Is Bitcoin Shorting?

Bitcoin is a volatile asset, which means it may make enormous gains and means it can lose a lot of value. Traders borrow Bitcoin and sell it for cash when the value of BTC is expected to fall. They purchase the sold assets and give them to the lender when the price of Bitcoin declines, retaining the price difference as gain. Shorting is the term for this strategy, and it may be a very successful approach to expand your portfolio.

How to Short Bitcoin?

Below are some methods you can apply to short Bitcoin: 

Margin Trading

A cryptocurrency margin trading platform is permitted by many exchanges and brokerages, with margin trades enabling investors to "borrow" money from a broker to place a transaction. It's crucial to keep in mind that there might be a leverage element at play, which can raise your earnings or your losses.

Futures Market

A buyer agrees to acquire security with a deal that defines when and at what value the security will be traded in a futures trade. When you buy a futures contract, you're betting that the price of the asset will climb, ensuring that you'll be able to find a great deal on it afterwards. However, selling a futures contract indicates a defeatist mentality and predicts that Bitcoin's price would fall.

Call And Cut Options

If you want to short the currency, you will place a put order, most likely with the help of an escrow provider. This implies you want to sell the currency at the current rate, even if the rate lowers later.

Prediction Markets

These markets let investors construct an event and gamble on its outcome. As a result, you might forecast that Bitcoin would drop by a particular amount or percentage. If another trader accepts your bet, you'll benefit.

Bitcoin Assets That Have Been Short-Sold

While this may not be appealing to all investors, individuals who want to acquire and sell Bitcoin directly might short-sell Bitcoin. Sell tokens at a price you're comfortable with, wait for the price to decrease, and then repurchase tokens. If the value does not move as you anticipate, you may lose revenue or Bitcoin assets in the procedure.

What Is Bitcoin Longing?

Longing Bitcoin is essentially banking on its long-term appreciation. This is an easier approach compared to shorting, and every broker allows you the ability to go bullish on an asset.There is some evidence to indicate that Bitcoin is a good long-term investment, but conduct your research before making any choices like with any investment. Some investors make big annual investments, while others only buy when the price falls.

How To Long Bitcoin?

Longing Bitcoin is as straightforward as purchasing it on one of the exchanges, keeping it till the price increases, and then selling it. More experienced traders utilize margin (or leverage) trading exchanges, where they deposit collateral (typically their Bitcoins) to borrow money to acquire Bitcoins. Margin trading platforms may be very rewarding while also being quite dangerous since you risk losing all of your collateral.

Stacking sats is one approach to reduce risk while wishing for Bitcoin. This refers to buying tiny quantities of Bitcoin (satoshis or "sats") regularly. This dollar-cost averaging approach reduces losses caused by Bitcoin's volatility and results in more consistent portfolio growth over time. 

When investing for the long term, it's equally critical to keep your digital assets safe. Although online exchange wallets are typically insured, offline or "cold storage" wallets provide greater security by keeping your assets unavailable to the network.

Conclusion

Trading Bitcoin short and long may have a variety of objectives, which can vary over time. Even if you're solely interested in Bitcoin, expanding your cryptocurrency portfolio can help you decrease your risk. Bitcoin has an impact on the cryptocurrency market in the same way that the market impacts Bitcoin. 

Shane Neagle explains how trading forex with bitcoin works.

Bitcoin has evolved to be an outstanding speculative investment, capable of delivering lavish returns. It is the most widely traded cryptocurrency, and given its volatility, one of the most attractive options for day traders. All around, Bitcoin has managed to draw the attention of numerous forex brokers, and is widely available to be traded as part of the BTC/USD currency pair.

Bitcoin Legality by Jurisdiction

Bitcoin is a decentralised peer-to-peer digital currency, implying that it is not issued, regulated, or backed by any central bank—which is a stark contrast compared to the world’s leading fiat currencies. Despite its broad use-case, Bitcoin is still largely unregulated internationally. 

However, certain countries have enacted a variable amount of regulatory oversight regarding Bitcoin, while some have even proceeded to grant it legal status. In some parts of the world, Bitcoin is becoming more accessible, with certain small business payments software facilitating payments in Bitcoin. In other areas of the globe, Bitcoin faces an outright ban. In this sense, the extent to which one can use Bitcoin when trading forex will largely depend on the applicable regulatory jurisdiction.

The United States

In the United States, there are two bodies most concerned with Bitcoin: the US Securities and Exchange Commission (SEC), and the Commodity Futures Trading Commission (CFTC). The SEC Chair has asserted that Bitcoin is not a security, while the CFTC, back in 2015, had classified it as a commodity

However, it is worth mentioning that due to the fragmented legal system in the US, there is both a federal law and a state law. While federal law generally supersedes state law, the latter can still vary drastically from state to state. For instance, back in 2014, Hawaii released a Bitcoin Warning, banning all Bitcoin transactions in the state. The state has since lifted the ban, yet continues to endure a more restrictive stance

On the flip side, states like Texas, California, Colorado, Ohio, and Wyoming have progressed to be exceptionally crypto-friendly. Just recently, Texas allowed banks in the state to store their clients' crypto assets. Likewise, in 2019, Colorado passed legislation to exempt cryptocurrencies from state securities laws under certain circumstances.

Other Countries

Canada, similar to the US, considers Bitcoin a commodity, viewing Bitcoin transactions as barter transactions. Russia, on the other hand, regards digital financial assets, which include Bitcoin, as property. In 2020, Russia had banned crypto from being used as a payment method. Earlier this year however, the country partially lifted this ban and allowed for crypto to be used as a “contractual” payment. The United Kingdom also considers cryptocurrencies as property.

China started an aggressive crackdown on cryptocurrencies and Bitcoin this year. Consequently, the country has banned its citizens from trading virtual currencies. Moreover, China has also banned financial institutions and payment firms from providing services to crypto-related companies.

Iran, just recently, drafted a law that prohibits crypto to be used as a means of payment. However, the country aims to support crypto mining and bring regulations to its domestic exchange market. 

El Salvador is the only country that considers Bitcoin as a currency. In June 2021, the country's Congress voted Bitcoin as legal tender. As a consequence, El Salvador became the first country in the world to adopt Bitcoin as a national form of payment. 

Trading Bitcoin in the Forex Market

In general, a trader can use Bitcoin to participate in the forex market in two ways:

Trading Bitcoin as part of a currency pair like BTC/USD is hypothetically similar to trading conventional forex currency pairs. In like manner, deals for buying and selling, stop loss, and take profit orders are placed.

However, due to Bitcoin's intrinsic features and the fact that it has been around for a considerably short time, in certain areas, Bitcoin emerges to be different from traditional currencies. 

For one, Bitcoins are created through mining and have a controlled supply which cannot be altered. This eliminates the possibility of a sudden increase in supply, which would decrease the value of a Bitcoin. On the contrary, fiat currencies are subject to the supply uncertainty originating from central banks.

Moreover, Bitcoin’s total supply is limited to 21 million, and its value is associated with the fundamentals of the crypto market — not a specific country, economy, or central bank. On the other hand, currencies are largely reliant on central banks. Thus, a shift in monetary policy can cause notable swings in currency prices.

Nonetheless, there are limited derivatives and other paper contracts around Bitcoin. A number of brokers are creating new contracts to allow investors to buy Bitcoin on margin, still, such contracts are very bounded. In contrast, currency traders can benefit from the abundance of over-the-counter (OTC) contracts and boost their leverage using the extensive list of contracts. 

Finally, another major contrast between Bitcoin and Forex is the subject of liquidity. Bitcoin’s market cap is currently estimated at $650 billion, while forex is a $6 trillion market. Naturally, this implies that there is substantially more liquidity in the forex market and that Bitcoin is subject to a volatile trading atmosphere.

Forex Brokers vs. Cryptocurrency Exchanges

Numerous forex brokers including AvaTrade, eToro, and LiteForex do offer Bitcoin trading. However, many brokers are limited to offer contracts for difference (CFDs). Considering CFDs are not allowed in the US, Americans should be heedful of the possible legal implications. 

Moreover, given that the world’s trusted forex trading platforms are not Bitcoin-based, they are most likely to go through a traditional cryptocurrency exchange. Subsequently, this raises the question of whether these brokers do anything other than allow users to trade Bitcoin through existing crypto exchanges.

Bearing these points in mind, it would be more beneficial for investors to trade Bitcoin using a traditional cryptocurrency exchange — at least until forex brokers grow more prosperous in their Bitcoin offerings. Still, it is worth mentioning that not all crypto exchanges offer cheap trades. 

For instance, Coinbase, which is the most recognized cryptocurrency exchange across the US, happens to be among the most expensive exchanges. Coinbase can charge a trader up to 3 distinct fees in a single trade. When comparing Coinbase with eToro in terms of fees, eToro turns out to be cheaper. 

However, another crypto exchange, Binance.US, can be cheaper than almost all brokers. Binance.US charges a flat 0.1% spot trading fee. In comparison, eToro charges about 0.75% for Bitcoin trades, and Coinbase charges 0.5% for trading fees plus a flat fee of up to $2.99 per trade. Further, Binance.US charges no fee for cash deposits or withdrawals by ACH bank transfers.

Most people are now confused about this rollercoaster relationship between China and cryptocurrency. Is mining cryptocurrencies illegal in China? Is Bitcoin banned in China? Let's take a look at some of the issues that can help us put this matter into perspective.

Is Cryptocurrency Illegal In China?

Recently, China gave prohibitory orders to financial institutions that were partnering companies, making it impossible for cryptocurrencies to continue operations in the country. As a matter of fact, trading platforms and exchanges have ceased operations in China. However, this is not the first time that the Chinese government has made such a move. In 2017, the ban was initiated when the ICO boom happened. In the last few weeks, the crackdown on crypto operations has intensified, and this intensification can be considered a reinstatement of the ban. Here is a summary of what has transpired in China in 2021:

There have been challenges with crypto mining in China and this has had some impact on the industry. You can read more on the different measures that different countries are taking in attempts to regulate the crypto markets.

BTC Mining In China

Most mining operations in China take place in Inner Mongolia, Yunnan, Xinjiang, and Sichuan. These are regions that have both renewable and non-renewable sources. With the government imposing bans and restrictions on mining Bitcoin in these regions, there are serious repercussions to crypto miners and investors. While it is not clear if BTC is banned in China, the ban on mining has created fear, uncertainty, and doubt in the global markets. This has been one of the contributing factors to the drastic decline in Bitcoin prices.

The Chinese government has not restricted owning and holding Bitcoin but has banned mining processes. One of the key concerns for prohibiting crypto mining in China is the fact that the industry is volatile and this can have adverse effects on the economy. In addition, China has been making every effort to become the leader in green energy. Bitcoin mining uses a lot of energy and this seems to be counterproductive. However, the government supports blockchain technology as it has intentions of introducing a central bank digital currency.

China has banned crypto mining, which seems to have impacted the market in a significant manner. On a positive note, miners will relocate to other parts of the work and this could neutralise China’s dominance in the crypto industry. Most experts are optimistic that, in the near future, this ban will be a blessing as Bitcoin's value will improve.

Not only has the Bitcoin bull cycle affected the bullish run of other cryptocurrencies, but it has also managed to completely alter the perception of institutional as well as retail investors regarding BTC.  Today there are hundreds of new businesses and investors that support BTC, and by doing so, they have triggered Bitcoin's success. However, other important components prompted the rise of Bitcoin. So, without further ado, let's take a look at some of the most important components of Bitcoin's success.  

Innovative Nature Of The Blockchain Network  

The blockchain network is the foundation that made Bitcoin the first digital currency that operates without any third party. Otherwise, as this is a peer-to-peer-based electronic cash system, it allows the transactions to be processed quickly without any high fees. Moreover, it offers total transparency about the data of the transactions and processes, while the identity of the users stays anonymous. This triggered the success of Bitcoin. It had a good head start and was supported by the early adopters of the cryptocurrency. It also had the first-mover advantage in the market. It is worth noting that the above-mentioned advantages always put Bitcoin in an envious position in the crypto market.  

Digital Scarcity  

Another component that is crucial for Bitcoin's profitability is the digital scarcity of this virtual currency. Because Bitcoin has 21 million Bitcoin tokens in total, the supply is capped without the possibility of creating another Bitcoin token, which puts Bitcoin in a space with rare and valuable assets. This also positioned Bitcoin as a safe-haven asset because there are only about 3 million BTC left to be mined. It is powered by decentralised blockchain technology, it is not influenced by economic factors like monetary policies, recession, financial crisis, and even political instability.  

Availability On Online Trading Platforms   

Because Bitcoin is one of the first cryptocurrencies to ever be created, it is widely accessible on most online trading platforms. For example, Bitcoin Fortress is a recognised automated trading platform that is driven by Artificial Intelligence Technology and it can generate top tradable insights for its members. Plus, the complex trading processes are fully automated, which means you can start trading even as a complete crypto newbie. You only need to deposit a minimum of $250. Another important feature of this trading platform is they don't charge any fees to their users except for a 2% commission on profitable accounts. So if you want to invest in Bitcoin today, you can choose from many online trading platforms as well as automated trading platforms, which are great for any inexperienced investor. Because most platforms are compatible with mobile devices, you can even trade on the go.  

Support From The Business Sector  

It's worth mentioning that businesses have continued to support Bitcoin even when it was considered a volatile investment. Naturally, in the beginning, there weren't many businesses that supported BTC. However, when reliable brands like Overstock accepted BTC payments, this positively impacted the value of Bitcoin. Over the years, the number of famous companies that accept BTC payments would grow significantly. You can even recognise big brands like Microsoft, Etsy, OkCupid, Home Depot, PayPal, and many others that now accept BTC transactions. However, the success of Bitcoin was also supported by brick-and-mortar businesses that decided to accept BTC payments, and along with online businesses, they made Bitcoin an accessible currency and drove the demand for BTC. Today businesses like Tesla have invested over $1 billion in BTC — a move completely unheard of until 2021.   

“They have no intrinsic value. That doesn’t mean to say people don’t put value on them, because they can have extrinsic value. But they have no intrinsic value,” he said during a press conference in London earlier this month. “I’m going to say this very bluntly again. Buy them only if you’re prepared to lose all your money.”

There’s no denying that cryptocurrency is a very divisive subject, inspiring fans and critics alike to voice their opinions on its worth. Would investors be sensible to take heed of Bailey’s advice and steer clear of crypto, or would it be very naive to write it off just like that?

The ‘value’ of cryptocurrency is unclear

Firstly, Bailey is correct in saying cryptocurrencies have no intrinsic value. However, neither does the pound sterling or other fiat currencies, which only hold value due to the trust people place in the respective governments, and the fact that the relevant parties maintain or agree on their value. And although the value of cryptocurrencies can be manipulated, fiat currencies can be devalued overnight if central banks decide to print more money, for example.

That said, Bailey’s comment on extrinsic value is significant. For example, unlike fiat currencies, the fact that there is only a limited number of bitcoins means people undoubtedly place extrinsic value on the cryptocurrency. Yet the fact of the matter is that, at present, cryptocurrencies only exist to be bought and sold rather than be used in any practical capacity. As such, market value doesn’t reflect the ‘true’ value. Just look at the unbelievable rise of Dogecoin in the last few months. Although it was initially set up as a joke, it reached a market cap of over $80 billion in May (it dropped off after Elon Musk joked about it during his Saturday Night Live appearance).

Essentially, investors are speculating on coins that offer nothing in material terms, and many are doing so due to ‘Fear of Missing Out’. FOMO can trigger irrational behaviour when money is involved, and many people are seduced by stories of those who made fortunes out of cryptocurrency. We know these gambles can result in impressive profits, but the very nature of cryptocurrency makes it an especially risky asset.

Cryptocurrency volatility can be dangerous

Cryptocurrency is one of the most volatile assets around, and this is precisely why so many people are drawn to it. Huge price swings mean that investors could make hefty profits in a short space of time, but it also means that losses can accumulate just as fast. So, Bailey has a point when he says “prepare to lose all your money” — if the value of a cryptocurrency suddenly drops by hundreds or thousands of pounds, investors could be very badly burned. Only in February did Bitcoin experience its highest ever daily price drop, losing $10,000 in the space of 19 hours. There was another sharp decline in May when Bitcoin halved in just 9 days.

On the other hand, investing always comes with risk, no matter what assets are involved. Companies and even countries can go bust and cost people their investments for a number of reasons, whether that’s a poor business model or too much debt. Cryptocurrency is arguably more high-risk simply because it is an incredibly complex technology that is difficult to fully understand. Nevertheless, the rules for investors speculating on cryptocurrencies are the same as they are for other financial instruments: conduct thorough research, exercise due diligence, and never risk money they can’t afford to lose.

Regulating cryptocurrency is a serious challenge

Regulation is a big concern when it comes to cryptocurrency given the fact it can be exploited for criminal purposes like money laundering and fraud. One of the most famous examples of this is OneCoin, a Ponzi scheme promoted as a cryptocurrency that brought in approximately $4 billion worldwide according to US prosecutors. Unfortunately, cryptocurrency is very difficult to regulate, though certain countries such as China have launched measures in an attempt to crack down on crypto activities. Ultimately, governments need to strike a balance between protecting investors and consumers without hampering innovations that could have overwhelmingly positive impacts on our financial systems.

Bailey isn’t the only regulator to recently issue a warning about cryptocurrency. Gary Gensler, the newly appointed head of the US Securities and Exchange Commission (SEC), has suggested the need for greater regulatory oversight of exchanges trading crypto assets to instil more confidence. He added that he had asked Congress to consider this issue.

In the meantime, there is a lot of uncertainty surrounding cryptocurrency exchanges that investors must be aware of (this is why we do not currently offer cryptos to our customers at Trade Nation). That said, if the regulatory environment was to change, the outlook could look quite different. The best advice for anyone interested in cryptocurrency is to tread carefully, prepare for risk, and only invest within their means.

On Tuesday, bitcoin plunged to around $28,890, losing 50% of its value since its all-time $63,729.5 high in April. The drop comes as China told banks and payment platforms to stop supporting digital currency transactions. On Friday, bitcoin mining in the Sichuan province was brought to a halt by government orders. Last month, the State Council pledged to clamp down on the mining and trading of cryptocurrencies as part of its campaign to control financial risks. On Monday, China’s central bank said it had newly called for several major banks and payment companies to take tougher action against the trading of digital currencies. Banks in China were ordered to stop providing products and services, including trading, clearing, and settlement, for cryptocurrency transactions.

According to research by the University of Cambridge, China accounted for approximately 65% of global Bitcoin production in 2020. The Sichuan province was the country’s second largest producer of digital currency.

If you want to take full advantage of these innovations, it is critical to identify and understand the many drawbacks and obstacles that may prevent their widespread adoption.

Scalability

One of the biggest concerns you’ll find with cryptocurrencies is the scaling issues. Despite the rapid increase in digital coins and adoption, many more transactions are processed daily by the payment giant VISA than by digital coins. In addition, the speed of a transaction is another critical point at which cryptocurrencies cannot compete with players like Mastercard and VISA unless the infrastructure providing these technologies gets massively scaled. Such a transition is complex, difficult, and definitely not seamless. The good news is many have proposed diverse solutions (such as lighting networks, starking, and sharding), and these are likely to deal with scalability issues over time.

Cyber Security Issues

Cryptocurrencies are digital technologies, which means they are prone to hacker attacks. According to Bitcoin Rush, Several ICOs have been hacked this summer, causing investors to lose many dollars. (One attack led to the loss of $473 million.) Managing this threat will require constant maintenance of security infrastructure. Still, we're already seeing players deal with it directly and use enhanced cybersecurity measures beyond what is used in traditional banking.

The Volatility Of Prices And Lack Of Inherent Value

Price volatility is a significant issue, and Buffet specifically alluded to it a few weeks ago when he described the cryptocurrency ecosystem as a bubble. There is a concern here, but you can overcome it by linking cryptocurrency values directly to tangible and intangible assets (as some new players are doing with energy derivatives or diamonds). Consumer confidence should also rise as adoption increases.

Correlations

From 2010 to 2021, the S&P 500 has fallen 17 times, while bitcoin has risen seven times. In other words, bitcoin also declined in 10 of the 17 months the S&P 500 declined. There were four months in which bitcoin's price declined when the S&P 500 suffered a decline - this indicates that bitcoin has not been able to provide diversification benefits when needed most. A positive correlation exists between bitcoin returns and S&P500 returns, which is stronger than the correlation between gold and S&P500 returns.

Regulations

Speaking on the issue of regulations, Buffet has said: “It doesn’t make sense. This thing is not regulated. It’s not under control. It’s not under the supervision [of] any…United States Federal Reserve or any other central bank. I don’t believe in this whole thing at all. I think it’s going to implode.” Although we can perfect the technology and solve all the problems mentioned above, investment in this technology will be riskier until federal governments regulate the technology. A further concern with the technology relates to logistics. Changes in protocols, for example, that are required when technology is being improved, can take so long a time and disrupt normal operations.

With all the obstacles to mass adoption, it's only logical that experienced investors such as Warren Buffet would take a cautious approach to this technology. The fact remains that cryptocurrencies (as well as blockchain technology) will thrive in the future. They offer several advantages consumers desire from a currency; transparency, decentralisation, and flexibility being among the most popular. Extending the discussion to all the things blockchain can make possible throughout all industries further reinforces this point.

 

Last year, the London-based fintech firm made £39 million on its cryptocurrency investments. The company, which allows its users to trade in anything from silver to bitcoin, saw its revenues jump by 34%, reaching £266 million. Revolut said it turned a profit in the final two months of 2020, a period which coincided with the start of a big rally in cryptocurrency prices. 

However, the company’s continued expansion across the globe resulted in increased admin and employee costs, pushing up losses. In 2019, pre-tax losses sat at £107.7 million, but in 2020 that figure reached £207.8 million. The fintech firm had employee costs of £170 million, close to a triple-increase on the employee costs it incurred the previous year. 

Despite 2020’s losses, Revolut has become one of the most valuable fintech companies in the United Kingdom. In its last private fundraising round, the firm was valued at around $5.5 billion, despite still not holding a full UK banking licence.

Mikko Salovaara, the new chief financial officer of the firm, has said that 2021 started positively. By the end of last year, Revolut had 14.5 million retail customers, while commercial customers reached 500,000. 

Bitcoin saw an 11% price increase after Tesla CEO Elon Musk stated that his company will start accepting bitcoin once miners begin to use cleaner energy. Turning to Twitter, Musk said: “When there’s confirmation of reasonable (~50%) clean energy usage by miners with a positive future trend, Tesla will resume allowing Bitcoin transactions.”

Back in February, Tesla revealed that it had bought $1.5 billion of bitcoin and stated that it would accept the cryptocurrency on its cars. But, by last month, Tesla did a U-turn, announcing that its vehicles could no longer be purchased using the digital currency. Tesla said this was due to bitcoin’s increasing use of fossil fuels for its mining. The announcement resulted in the cryptocurrency crashing. 

Analysis by Cambridge University suggests bitcoin currently uses more electricity annually than the whole of Argentina. The mining process to create new units of bitcoin involves solving complex mathematical equations, which is reliant on high levels of computer processing power. Many critics believe that there is no such thing as “green bitcoin” as miners will always opt for the cheapest option to maximise their returns. However, others believe that institutional investors can lead bitcoin down a more environmentally sustainable path. Yves Bennaïm, the founder of non-profit Swiss think tank 2B4CH, has argued that as big investors like Tesla boost digital currency prices, there’ll be a greater incentive for investments in renewable energy sources. 

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