THE FUTURE OF BITCOIN AND OTHER CRYPTOCURRENCIES

Abstract

Bitcoin and other crypocurrencies are decentralized digital currencies without a national bank that can be transferred from client to client on the distributed ledger unconditionally. In the March of 2020, the price of Bitcoin was only around 6.000 USD whereas, it reached to almost 60.000 USD in May 2021, only after one year. It is obvious that the Corona pandemia has changed the destiny of the Bitcoin and other cryptocurrencies. Traditionally, a currency should have three features that distinguish it from all other commodities. These features are having the capability of being used as a medium of exchange, being a unit of account and functioning as a store of value. Although it is early to state that Bitcoin and other cryptocurrencies perform all of these features, the popularity of them as a currency in the market is rising and they are more preferred as a commodity to invest. The crptocurrency market and particularly Bitcoin, turned out to be the most resistant to economic fluctuations experienced by all global markets in the last one year. However, the future of Bitcoin and other cryptocurrencies is closely related to the course of pandemia and several other factors which may push down demand for them.