October 21, 2021. No. 42
Since its inception in 2009, Bitcoin (BTC) has been characterized by its high volatility. Its price happened to be worth absolutely nothing, and when nothing is said, it is NOTHING. Imagine that nobody wanted to buy 10,000 BTC for only $50 USD in 2010. How much money would we be talking about right now? I'm telling you, don't start calculating: 10 000 BTC = 640 billion USD today. When have you seen an investment of $50 USD in 11 years turn into 640 million USD? Do not search, you will not find something similar.
To get to the point we are today, we do not go through pink paths. And although 11 years seems like a short time to become a millionaire, it is an eternity for those of us who are watching its price every second. If you are a newbie, and even the not-so-newbies, they feel threatened by the price at every moment. I myself when I started and had my first BTC in my wallet, every two seconds I looked at the price. Sleeping I would wake up and look at the price of BTC. It went up, down, up, down, I was constantly telling my wife. And when that was around $10,000 USD in a less stable way. I even told him: "BTC is the future, we are going to save it." I liked to see even Kaiser Report, a finance space dedicated mainly to cryptocurrencies and BTC in general, is from the RT news network. There he is given a huge promotion to use BTC as currency and buy it, to even exit the banking system. I wonder right now, a few years later: "Why would I have sold my BTC for FIAT or even put it in an investment company that turned out to be a scam?" And it is logical if I had the idea that BTC would be the maximum in the future, even so, I did not listen to my instinct, doing the opposite. Result: I don't have the slightest satoshi in my BTC wallet. I got to have in those days about 0.05 BTC.
BTC itself may be on the moon, or it may be underground in a matter of seconds. I remember going down from $9000 to $3000 USD in a very short time. I had a friend who bought more even at that moment. But my heart can't bear those more than 50% drops in losses. In addition, the cost of each BTC transaction is very high. To send a few BTC you have to pay a fee that can be even higher than the BTC you are going to send. This has undoubtedly made BTC used by traders and holders, waiting for the right moment to take profits. It is said that a trader is happy when the river is rough. Because if you know how to do it, you can make a profit. So what they like is that great volatility, to be able to carry out their strategies.
For all the above, we fall into the following: Would you use BTC to pay for a hamburger at a KFC, paying 0.00035484 BTC from your wallet? Also, remember that you have to pay a fee, which should be similar to the same price as the hamburger itself. Otherwise, and you do not send a high fee, that transfer would not arrive on time, so the confirmation that you actually made it would take a few hours or even more (the first transfer I made, took a week to be validated in the blockchain). So you would be sitting at the KFC, waiting for your transaction to be confirmed. Your burger, soda, and fries would certainly freeze.
On the other hand, what if after paying for a car, using your BTC, after a few minutes the price rises to almost 30% more? You will have lost money. Will you be able to handle this situation? Even if you want to buy a second-hand item for your neighbor, and the price is currently falling dramatically, would your neighbor still want to sell it to you right then and there? I guess not, because you know you would get a lot less BTC than you could have gotten before, so you would wait a bit longer.
In all the news you read, certain questions are explained to you as to why BTC cannot be taken as money. I have asked several friends who have been in the crypto world for years and they all agree and I have the same criteria, that BTC is too volatile to be used as money. My personal opinion is that it is a currency that we can access with the hope of growing our capital in the future. If you trade, you can even grow your capital much faster.
El Salvador has recently accepted it as legal tender. But in its regulations, it includes that only if the person from whom a product is going to be bought or sold agrees to accept those BTC. This makes it fairly optional of course. It is authorized, but it depends on everyone agreeing to make those transactions using that cryptocurrency.
Today the BTC exceeded $66 000 USD, an astronomical price that its incredible for many people. Others have been waiting for months and years for it to happen. Today they can finally make a profit after many months of intervention. Whoever buys BTC now is exposed to it going down and ending up in losses for who knows how long. Despite the fact that companies continue to accept BTC even now as a means of payment. Now in times like this, it would even be a suicide for me to buy a simple piece with some BTC. Perhaps history will repeat itself and that piece will cost $10 000 in a couple of years.
However, despite all this, BTC can be used to buy any number of items all over the internet. From a plane ticket to a car. Many accept it as a form of payment, companies and large corporations, especially. Although I have seen some photos from different parts of the world, where small entrepreneurs and these are called, like ordinary people with a small point of sale, with a sign: "Payment is accepted in BTC". This is how things go. For the world to be a world, there has to be everything. Personally, I do not use them to buy a pizza, as long as I have FIAT money to go to.
Friends, this is the third entry for "2021 Bursting the Myth Around Bitcoin writing competition" organized by @SofiaCBCH. You can also participate if you wish. Don't let them tell you, live it.
You can see my first entry here: Bitcoin can be hacked and my second entry Bitcoin is a waste of energy resources.
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Looking at the transaction fees when using BTC now, it is not wise to use it as a legal tender.