Bitcoin is Dead: Everything You Need to Know About Crypto in 2021
Let’s address Bitcoin’s recent glitch and U.S. regulation concerns
Bitcoin is dead.
That phrase has been said roughly 390 times since 2010. In 2020, however, that ominous saying was used the least ever. Bitcoin was reported dead or dying only 11 times.
Now, Bitcoin is being called dead once again. The Biden presidency seems locked and loaded to regulate cryptocurrency. Moreover, Bitcoin experienced a “glitch” that sent its price crashing more than 20%.
Bitcoin is dead — and this time it’s serious.
Will Global Regulators Kill Bitcoin?
Earlier this month, Britain’s Financial Conduct Authority warned crypto traders that they “should be prepared to lose all their money” because there are so many risks involved in Bitcoin.
Furthermore, Janet Yellen, President Biden’s pick to head the Treasury, laid down the hammer when she voiced worries last week that decentralized, anonymous cryptocurrencies could be used by criminals — provoking fears of a regulatory clampdown under the Biden administration.
“I think many are used, at least in a transactions sense, mainly for illicit financing, and I think we really need to examine ways in which we can curtail their use and make sure that money laundering does not occur through these channels,” Yellen said Tuesday.
This sounds like very scary stuff for Bitcoin.
Except it’s not.
This is who regulators hurt most
One country’s failure to realize the opportunity with crypto is another’s gain. Deregulating Bitcoin only hurts legitimate businesses that can benefit from its global, deflationary properties. Countries that have outlawed Bitcoin forced it onto the Black Market and lost out on benefiting it themselves.
Think marijuana and why U.S. states are now legalizing it for major tax income.
Let me reiterate, legitimate U.S. businesses are the ones the U.S. hurts most with regulation. What’s stopping another global powerhouse like China or Japan from welcoming Bitcoin with open arms?
Don’t forget that Bitcoin is a deflationary currency, something that the U.S. needs desperately right now after printing 20% of all U.S. dollars ever created. Yes, one-fifth of ALL U.S. dollars were created in 2020 alone to fuel stimulus packages and financial bailouts.
Inflation is predicted to get much worse under Biden.
Will Bitcoin’s Recent Glitch Kill Cryptocurrency?
The “glitch” that sent crypto-Twitter up in flames is called a “double-spend attack.”
Let’s break it down.
Bitcoin transactions still take a lot of time. So, you’re able to speed that up by spending a fee. The bigger the fee, the better the chance are of getting your transaction done faster.
Problem is, when you pay that fee, you’re in line waiting for your transaction to complete and unable to increase that fee any further. Instead of waiting, however, this trader decided to leave his first transaction and create a new one with a bigger fee to get things done even faster.
This created two of the same transactions — which is perfectly fine and the blockchain is actually built to handle. However, the first transaction was still going and actually completed before the second. This made it look like two transactions were completed in the end; it looked like the blockchain made a mistake.
It didn’t take long for everyone and their momma to freak out. Many believed Bitcoin’s blockchain made a mistake by charging this user twice. In reality, it did nothing of the sort. It just looked that way for a brief moment before correcting itself.
Some people think this was all a coordinated plan. An innocuous “glitch” like this would scare Bitcoin beginner investors away because they don’t know anything about cryptocurrency and blockchain. Interestingly enough, the transaction was only for $21 despite two big fees attached to it.
So if there was any kind of plan — looks like it worked.
Should You Be Worried About Future Bitcoin Glitches & Hackers?
Nope.
This situation created a lot of “FUD,” otherwise known as Fear, Uncertainty and Doubt. When FUD sinks in, novice investors sell without even first understanding what’s going on.
When Bitcoin’s price dropped from this recent controversy, I ended up buying more. I was so happy I could get more for a lower price. This is why some think the aforementioned “glitch” could have been planned.
If you understand Bitcoin, then you’re in it for the long haul. No amount of FUD is going to make you sell off your investment. Not even if Bitcoin went down to $1.
The blockchain technology behind Bitcoin and Ethereum is game-changing. It’s like investing in the internet in the 1990s. Furthermore, blockchain is built so that hackers and glitches cannot happen barring circumstances that are rarer than being struck by lightning twice.
The Biggest Mistake Many Crypto Investors Make
They invest in Bitcoin without first understanding it. They just want to make money ASAP and go home with their loot.
Sure, you can probably pull this off if this is you. The problem is, however, that when Bitcoin drops you may not have the stomach to wait it out. Your lack of confidence — of knowledge — will make you pull the trigger on what could be the best investment of your life.
Learn as much as you can about crypto before investing any money into it. This game isn’t for the faint of heart. You have to believe in what you’re getting into, or else you might burn a hole in your pocket.
Consider picking up my new eBook, “Mind and Muscle: The Psychological Benefits of Healthy Habits”
