If you’ve been following Bitcoin for a long time now, then you have probably heard countless people say that its biggest threats are the central bank and the government. But as the popularity of cryptocurrencies continues to surge, it appears that the real threat to Bitcoin is blockchain itself, as this technology enables anyone with the requisite know-how to launch new digital coins.
Over the past year, there has been a significant rise in the supply of cryptocurrencies, many of which challenge Bitcoin. While a huge percentage of these new coins will be gone after just a few months, some of them come with a huge potential that many investors think that Bitcoin is slowly losing its grip as the most dominant cryptocurrency of them all.
The Case For Altcoins
People who trade cryptocurrencies regularly like to invest in Altcoins. The reason is simple: the earning potential is bigger. A case in point is the cancelation of Segwit2x back in November 2017. Prior to this, many investors were holding on to their Bitcoin to see what would happen after the hard work. But after its cancelation, these same investors took their profit and moved their money to Altcoins.
This caused Bitcoin’s price to drop by a staggering 29%, equivalent to $2,000 at the time. Whether it’s market manipulation or any other reason, it’s clear that Bitcoin deals with trading issues. The reality is that the coins with the biggest market capitalisation have reached a point in which they’re big enough to influence Bitcoin’s prices.
Investing in Bitcoin and other digital tokens have also become easier thanks to trading platforms like Bitcoin Loophole, which allows users to set up their own rules for trading. But other than the investment opportunity, many are also using Altcoins because of certain things Bitcoin lacks.
For one, many Altcoins offer cheaper and faster transactions. Today, it isn’t difficult to find digital coins that can process twice as fast as Bitcoin. With more merchants accepting virtual currencies as payment, this is a huge advantage going against Bitcoin.
Why Bitcoin Remains Relevant
Although it’s not as dominant as it used to be, Bitcoin proves stronger than ever. It has the advantage of longevity, something that cannot be understated in the realm of cryptocurrencies. It has been tested way more times than its younger alternatives. Also, it has been proven secure for a decade. There are also more merchants, exchanges, and software supporting Bitcoin. This means that Bitcoin is the most liquid out of all digital coins, making it the most accessible.
While many Altcoins show a lot of promise, they have the burden of proving themselves to investors, merchants, and exchanges. The government is also constantly warning the public about the dangers of cryptocurrency trading, particularly with regards to ICOs. All this compels people to put their money on Bitcoin, knowing that it has the credentials and history to be regarded as a safe investment.
The war between Bitcoin and Altcoins may not see an end anytime soon. Blockchain technology has clearly disrupted many industries, prompting developers to come up with new coins that challenge the norms. It seems that virtual coins will eventually play a specific role in the market. Bitcoin may be used for larger payments, while Altcoins with faster and cheaper transactions may be used for everyday purchases.