So, what is the future of Bitcoin? This is definitely a hard question. If anyone knew the answer, they would be extremely rich. All predictions below are based on one assumption – that Bitcoin will still be around in 50 years. For the purposes of this article, let’s assume that Bitcoin does still exist and take it from there.
The future of Bitcoin
Firstly, it will be an unrecognizable currency in terms of how it operates. It didn’t take very long for programmers to figure out that there was a problem with scalability. In 50 years’ time, Bitcoin will have hard forked many more times over to be replaced by a scalable currency that doesn’t require on the level of energy or computational power that it currently does. Frankly, this has to happen otherwise it will quite literally burn itself out, like the life cycle of a star. The rate at which Bitcoin consumes power isn’t even sustainable now. So in 50 years, something will have changed, or Bitcoin will have ceased to exist.
Let’s move on to the issue of mining. At this rate, in 50 years, there won’t be many Bitcoin left to mine. The incentives will have shrunk to a point at which nobody except large mining pools will be doing it anymore. This is another reason why I think the entire underlying network will have changed, eliminating proof of work and mining as we know it. It just isn’t an efficient system and as it goes on, it moves further and further away from true decentralization.
Bitcoin and Governments
The third thing that is likely to happen is that governments will finally rule. Either separately or as groups (like the EU) that Bitcoin should be regulated. They will come up with regulations that put it more in line with regular currency in order to safeguard members of the public and traditional financial institutions from collapse. It may even be that they decide to completely outlaw Bitcoin in their countries and go down the route of government-issued cryptocurrencies. In fact, as a bold prediction, many believe that if there’s a chance that a cryptocurrency can become a truly global currency. It may be a government-issued one – not one that currently exists.
The final thing that many expect to happen is that cryptocurrency prices will stabilize and this will mean that Bitcoin will find its price. It is likely that as Vitalik Buterin predicts, that 90% of cryptocurrencies will fail and die. Bitcoin though, thanks to its value and its backing, is one of the ones that will survive. It will have become closer to gold in the way it is owned and stored. Because most of it will have been mined, and there will be fewer transactions in its current iteration.
So, what is the future of Bitcoin?
In conclusion, while many do think that Bitcoin has a future, it isn’t the future that many hope it will be. At least not in its current form. A truly global currency needs to be far easier to scale, far cheaper to run and operate on a far more flexible system than proof of work in order to become truly global and achieve acceptance from governments worldwide.