<p>On Wednesday,&nbsp;El Salvador's legislature passed a law that designates Bitcoin legal tender. This makes it possible to pay taxes with Bitcoin, and businesses will now be obligated to accept Bitcoin payments, and converting Bitcoin to other currencies will no longer be subjected to capital-gains tax. With this law that will take effect in 90 days, El Salvador becomes the first country in the world to consider Bitcoin a legal currency.</p>

<p><img alt="Cryptocurrency" data-entity-type="file" data-entity-uuid="1901c461-46c5-4078-b849-f8f1269d5196" src="//cdn.wionews.com/sites/default/files/inline-images/crypto.jpg" /></p>

<p>The advantage of being first might make El Salvador a tidy gain when investors and entrepreneurs alike flock to the nation, taking advantage of the good climate, lack of property tax, no capital-gains tax for Bitcoin, and immediate permanent residence for crypto entrepreneurs.</p>

<p><img alt="Cryptocurrency" data-entity-type="file" data-entity-uuid="c6da70e5-6a28-4501-a2ef-2ebeeb1bf54e" src="//cdn.wionews.com/sites/default/files/inline-images/crypto%201_0.png" /><br />
&nbsp;</p>

<p>After El Salvador's legislature has legalised Bitcoin and deemed it a currency, the road ahead looks bright for other developing countries in the region. It is not only the President of El Salvador who is positive towards crypto-currencies, but a lot of other leaders in Central and South American countries too.</p>

<p>Paraguay might be the second country to adopt Bitcoin, as the Deputy of the Nation Carlos Antonio Rejala Herman tweeted hints about adoption a few days back: “As I was saying, our country needs to advance hand-in-hand with the new generation. The moment has come, our moment. This week we start with an important project to innovate Paraguay in front of the world.”</p>

<p>Note the #BTC &amp; #PayPal in the tweet, could a collaboration be looming? Rejala also mentions 'to the moon' along with a picture of himself with laser eyes, a trend that caught on in the crypto currency community earlier this year.</p>

<div class="ui-state-default" contenteditable="false">
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<blockquote class="twitter-tweet">
<p dir="ltr" lang="es">Como ya lo decía hace un buen tiempo, nuestro país necesita avanzar de la mano de la nueva generación.<br />
Llegó el momento, nuestro momento.<br />
Esta semana empezamos con un proyecto importante para innovar a Paraguay frente al mundo!<br />
<br />
El verdadero to the moon ?<a href="https://twitter.com/hashtag/btc?src=hash&amp;ref_src=twsrc%5Etfw">#btc</a> &amp; <a href="https://twitter.com/hashtag/paypal?src=hash&amp;ref_src=twsrc%5Etfw">#paypal</a> <a href="https://t.co/ZMRJgAIxgO">pic.twitter.com/ZMRJgAIxgO</a></p>
— Carlitos Rejala ?￰ﾟﾇﾵ?￰ﾟﾙﾌ (@carlitosrejala) <a href="https://twitter.com/carlitosrejala/status/1401712725886132224?ref_src=twsrc%5Etfw">June 7, 2021</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script></div>
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<p>A move toward Bitcoin adoption could be very good for the economy of Paraguay, as the electricity is really cheap in the country and they produce more than twice as much electricity than what's used domestically, and they export power to both Argentina and Brazil at good rates. The cheap electricity, and positive legal outlook has led to the construction of one of the world's largest mining centers in the country.</p>

<p><img alt="Crypto" data-entity-type="file" data-entity-uuid="299a3436-257b-4f3c-ab64-b13b7963496b" src="//cdn.wionews.com/sites/default/files/inline-images/crypto%203%20final.JPG" /></p>

<p><img alt="Crypto" data-entity-type="file" data-entity-uuid="c78ebf0f-2ca1-438c-a0c3-8727ed2f7ddc" src="//cdn.wionews.com/sites/default/files/inline-images/crypto%204.jpg" /></p>

<p>The Golden Goose Mining Center has been built on a 200,000m² site near the Laipu hydro-power plant in Paraguay. Stable and cheap hydro-power coming from this mega-sized dam, along with political stability, low taxes, support of foreign-funded enterprises, low risk of armed conflict with neighboring countries and high speed internet has made Paraguay tick all the boxes that mining companies are looking for when setting up operations.</p>

<p><strong>Panama</strong></p>

<p>Gabriel Silva is pushing for support and tweets, “This is important. And Panama cannot be left behind. If we want to be a true technology and entrepreneurship hub, we have to support cryptocurrencies We will be preparing a proposal to present at the Assembly. If you are interested in building it, you can contact me”.</p>

<div class="ui-state-default" contenteditable="false">
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<blockquote class="twitter-tweet">
<p dir="ltr" lang="es">Esto es importante. Y Panamá no se puede quedar atrás. Si queremos ser un verdadero hub de tecnología y emprendimiento tenemos que apoyar las criptomonedas<br />
<br />
Estaremos preparando una propuesta para presentar en la Asamblea. Si están interesados en construirla me pueden contactarte <a href="https://t.co/yiAzPpD9nj">https://t.co/yiAzPpD9nj</a></p>
— Gabriel Silva (@gabrielsilva8_7) <a href="https://twitter.com/gabrielsilva8_7/status/1401965129051389958?ref_src=twsrc%5Etfw">June 7, 2021</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script></div>
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<p><img alt="Crypto" data-entity-type="file" data-entity-uuid="961d201c-65fa-4787-bf18-736f3192271b" src="//cdn.wionews.com/sites/default/files/inline-images/crypto%205.jpg" /></p>

<p>&nbsp;</p>

<p><strong>Mexico&nbsp;</strong></p>

<p>Senator Indira Kempis has also changed her twitter profile picture to one with laser eyes, along with many tweets supporting El Salvador's moves and the industry.</p>

<div class="ui-state-default" contenteditable="false">
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<p dir="ltr" lang="und"><a href="https://t.co/h5iJ24TmNw">https://t.co/h5iJ24TmNw</a> <a href="https://t.co/pBKVLDp7E9">pic.twitter.com/pBKVLDp7E9</a></p>
— Indira Kempis de I. (@IndiraKempis) <a href="https://twitter.com/IndiraKempis/status/1402129280830742531?ref_src=twsrc%5Etfw">June 8, 2021</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script></div>
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<p>&nbsp;</p>

<p>Eduardo Murat Hinojosa also sports the laser eyes, will propose a legal framework for cryptos in Mexico's lower house.</p>

<div class="ui-state-default" contenteditable="false">
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<p dir="ltr" lang="es">Voy a promover y proponer ante la Cámara de Diputados un marco legal para las criptomonedas en México <a href="https://twitter.com/hashtag/btc?src=hash&amp;ref_src=twsrc%5Etfw">#btc</a><br />
<br />
I will be promoting and proposing a legal framework for crypto coins in Mexico's lower house <a href="https://twitter.com/hashtag/btc?src=hash&amp;ref_src=twsrc%5Etfw">#btc</a> <a href="https://t.co/zwhYOZ7KAg">pic.twitter.com/zwhYOZ7KAg</a></p>
— Eduardo Murat Hinojosa (@eduardomurat) <a href="https://twitter.com/eduardomurat/status/1402257568580390923?ref_src=twsrc%5Etfw">June 8, 2021</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script></div>
<a class="close-mark close-div" href="#" id="jqclosemark">×</a></div>

<p>&nbsp;</p>

<p><strong>Colombia</strong></p>

<p>Jehudi Castro Sierra, Digital Transformation Adviser, Office of the Presidency of Colombia, contributed to the World Economic Forum's Decentralized Finance Policy-Maker toolkit and is calling for Colombia to embrace the emerging technology.&nbsp;</p>

<div class="ui-state-default" contenteditable="false">
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<p dir="ltr" lang="en">Very pleased to have contributed to the Decentralized Finance: (DeFi) Policy-Maker Toolkit from <a href="https://twitter.com/wef?ref_src=twsrc%5Etfw">@wef</a><br />
and <a href="https://twitter.com/Wharton?ref_src=twsrc%5Etfw">@Wharton</a>.<br />
DeFi is a great opportunity and Colombia is ready to embrace it. <a href="https://t.co/iih2IaPWm3">https://t.co/iih2IaPWm3</a></p>
— Jehudi ?￰ﾟﾇﾴ (@JCastroS) <a href="https://twitter.com/JCastroS/status/1402311469774131205?ref_src=twsrc%5Etfw">June 8, 2021</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script></div>
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<p>&nbsp;</p>

<p><strong>Brazil</strong></p>

<p>Fábio Ostermann updated his profile picture with laser eyes and tagged #LaserEyesTill100k showing his support.</p>

<div class="ui-state-default" contenteditable="false">
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<p dir="ltr" lang="und"><a href="https://twitter.com/hashtag/LaserEyes?src=hash&amp;ref_src=twsrc%5Etfw">#LaserEyes</a> <a href="https://twitter.com/hashtag/LaserEyesTill100k?src=hash&amp;ref_src=twsrc%5Etfw">#LaserEyesTill100k</a> <a href="https://twitter.com/hashtag/NovaFotoDoPerfil?src=hash&amp;ref_src=twsrc%5Etfw">#NovaFotoDoPerfil</a> <a href="https://t.co/tbxThxh5Ps">pic.twitter.com/tbxThxh5Ps</a></p>
— Fábio Ostermann (@FabioOstermann) <a href="https://twitter.com/FabioOstermann/status/1401988499893587968?ref_src=twsrc%5Etfw">June 7, 2021</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script></div>
<a class="close-mark close-div" href="#" id="jqclosemark">×</a></div>

<p>&nbsp;</p>

<p><strong>Argentina</strong></p>

<p>Francisco Sanchez updated his profile photo of himself with the laser eyes, commenting “I can't believe it, but this is how it is”.</p>

<div class="ui-state-default" contenteditable="false">
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<blockquote class="twitter-tweet">
<p dir="ltr" lang="und"><a href="https://twitter.com/hashtag/NuevaFotoDePerfil?src=hash&amp;ref_src=twsrc%5Etfw">#NuevaFotoDePerfil</a> <a href="https://t.co/zqftvmKRfB">pic.twitter.com/zqftvmKRfB</a></p>
— Francisco Sánchez ?￰ﾟﾇﾷ (@fsancheznqn) <a href="https://twitter.com/fsancheznqn/status/1402045792333012997?ref_src=twsrc%5Etfw">June 7, 2021</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script></div>
<a class="close-mark close-div" href="#" id="jqclosemark">×</a></div>

<p>&nbsp;</p>

<p><strong>Tonga</strong></p>

<p>Tonga is another country positive towards Bitcoin, with Lord member of Parliament Lord Fusitua looking to invest in Bitcoin with the nation's $750m of reserves.</p>

<div class="ui-state-default" contenteditable="false">
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<p dir="ltr" lang="en">Tonga ?￰ﾟﾇﾴ may be next nation to adopt <a href="https://twitter.com/hashtag/Bitcoin?src=hash&amp;ref_src=twsrc%5Etfw">#Bitcoin</a><br />
<br />
Lord Member of Parliament <a href="https://twitter.com/LordFusitua?ref_src=twsrc%5Etfw">@LordFusitua</a> says he's already chatting with <a href="https://twitter.com/jackmallers?ref_src=twsrc%5Etfw">@jackmallers</a> and is looking to buy <a href="https://twitter.com/hashtag/bitcoin?src=hash&amp;ref_src=twsrc%5Etfw">#bitcoin</a> with the nation's $750 million of reserves.<br />
<br />
Remittances also make up 37% of their GPD. <a href="https://t.co/mk1cxMC4Ul">pic.twitter.com/mk1cxMC4Ul</a></p>
— Documenting Bitcoin ? (@DocumentingBTC) <a href="https://twitter.com/DocumentingBTC/status/1402655617462980613?ref_src=twsrc%5Etfw">June 9, 2021</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script></div>
<a class="close-mark close-div" href="#" id="jqclosemark">×</a></div>

<p class="MsoBodyText">Support for crypto-currencies can come in many forms, whether it be by approving a certain project's tokens as legal tender, or by investing a countries reserves into digital assets to hedge against inflation. The industry is full of entrepreneurs and investors who are moving ahead at full speed, and the first countries to show support for these emerging technologies are set to gain tremendously by attracting jobs, talent and investments into their territories. Choosing an outright ban of crypto-currencies can make countries miss out on a huge opportunity for growth and high tech jobs, something that the entire world will need a lot more of after recuperating from the coronavirus pandemic.</p>


On Wednesday, El Salvador's legislature passed a law that designates Bitcoin legal tender. This makes it possible to pay taxes with Bitcoin, and businesses will now be obligated to accept Bitcoin payments, and converting Bitcoin to other currencies will no longer be subjected to capital-gains tax.

On Wednesday, El Salvador's legislature passed a law that designates Bitcoin legal tender. This makes it possible to pay taxes with Bitcoin, and businesses will now be obligated to accept Bitcoin payments, and converting Bitcoin to other currencies will no longer be subjected to capital-gains tax. With this law that will take effect in 90 days, El Salvador becomes the first country in the world to consider Bitcoin a legal currency. The advantage of being first might make El Salvador a tidy gain when investors and entrepreneurs alike flock to the nation, taking advantage of the good climate, lack of property tax, no capital-gains tax for Bitcoin, and immediate permanent residence for crypto entrepreneurs. After El Salvador's legislature has legalised Bitcoin and deemed it a currency, the road ahead looks bright for other developing countries in the region. It is not only the President of El Salvador who is positive towards crypto-currencies, but a lot of other leaders in Central and South American countries too. Paraguay might be the second country to adopt Bitcoin, as the Deputy of the Nation Carlos Antonio Rejala Herman tweeted hints about adoption a few days back: “As I was saying, our country needs to advance hand-in-hand with the new generation. The moment has come, our moment. This week we start with an important project to innovate Paraguay in front of the world.” Note the #BTC & #PayPal in the tweet, could a collaboration be looming? Rejala also mentions 'to the moon' along with a picture of himself with laser eyes, a trend that caught on in the crypto currency community earlier this year. Como ya lo decía hace un buen tiempo, nuestro país necesita avanzar de la mano de la nueva generación. Llegó el momento, nuestro momento. Esta semana empezamos con un proyecto importante para innovar a Paraguay frente al mundo! El verdadero to the moon ?#btc & #paypal pic.twitter.com/ZMRJgAIxgO — Carlitos Rejala ?￰ﾟﾇﾵ?￰ﾟﾙﾌ (@carlitosrejala) June 7, 2021 × A move toward Bitcoin adoption could be very good for the economy of Paraguay, as the electricity is really cheap in the country and they produce more than twice as much electricity than what's used domestically, and they export power to both Argentina and Brazil at good rates. The cheap electricity, and positive legal outlook has led to the construction of one of the world's largest mining centers in the country. The Golden Goose Mining Center has been built on a 200,000m² site near the Laipu hydro-power plant in Paraguay. Stable and cheap hydro-power coming from this mega-sized dam, along with political stability, low taxes, support of foreign-funded enterprises, low risk of armed conflict with neighboring countries and high speed internet has made Paraguay tick all the boxes that mining companies are looking for when setting up operations. Panama Gabriel Silva is pushing for support and tweets, “This is important. And Panama cannot be left behind. If we want to be a true technology and entrepreneurship hub, we have to support cryptocurrencies We will be preparing a proposal to present at the Assembly. If you are interested in building it, you can contact me”. Esto es importante. Y Panamá no se puede quedar atrás. Si queremos ser un verdadero hub de tecnología y emprendimiento tenemos que apoyar las criptomonedas Estaremos preparando una propuesta para presentar en la Asamblea. Si están interesados en construirla me pueden contactarte https://t.co/yiAzPpD9nj — Gabriel Silva (@gabrielsilva8_7) June 7, 2021 × Mexico Senator Indira Kempis has also changed her twitter profile picture to one with laser eyes, along with many tweets supporting El Salvador's moves and the industry. https://t.co/h5iJ24TmNw pic.twitter.com/pBKVLDp7E9 — Indira Kempis de I. (@IndiraKempis) June 8, 2021 × Eduardo Murat Hinojosa also sports the laser eyes, will propose a legal framework for cryptos in Mexico's lower house. Voy a promover y proponer ante la Cámara de Diputados un marco legal para las criptomonedas en México #btc I will be promoting and proposing a legal framework for crypto coins in Mexico's lower house #btc pic.twitter.com/zwhYOZ7KAg — Eduardo Murat Hinojosa (@eduardomurat) June 8, 2021 × Colombia Jehudi Castro Sierra, Digital Transformation Adviser, Office of the Presidency of Colombia, contributed to the World Economic Forum's Decentralized Finance Policy-Maker toolkit and is calling for Colombia to embrace the emerging technology. Very pleased to have contributed to the Decentralized Finance: (DeFi) Policy-Maker Toolkit from @wef and @Wharton. DeFi is a great opportunity and Colombia is ready to embrace it. https://t.co/iih2IaPWm3 — Jehudi ?￰ﾟﾇﾴ (@JCastroS) June 8, 2021 × Brazil Fábio Ostermann updated his profile picture with laser eyes and tagged #LaserEyesTill100k showing his support. #LaserEyes #LaserEyesTill100k #NovaFotoDoPerfil pic.twitter.com/tbxThxh5Ps — Fábio Ostermann (@FabioOstermann) June 7, 2021 × Argentina Francisco Sanchez updated his profile photo of himself with the laser eyes, commenting “I can't believe it, but this is how it is”. #NuevaFotoDePerfil pic.twitter.com/zqftvmKRfB — Francisco Sánchez ?￰ﾟﾇﾷ (@fsancheznqn) June 7, 2021 × Tonga Tonga is another country positive towards Bitcoin, with Lord member of Parliament Lord Fusitua looking to invest in Bitcoin with the nation's $750m of reserves. Tonga ?￰ﾟﾇﾴ may be next nation to adopt #Bitcoin Lord Member of Parliament @LordFusitua says he's already chatting with @jackmallers and is looking to buy #bitcoin with the nation's $750 million of reserves. Remittances also make up 37% of their GPD. pic.twitter.com/mk1cxMC4Ul — Documenting Bitcoin ? (@DocumentingBTC) June 9, 2021 × Support for crypto-currencies can come in many forms, whether it be by approving a certain project's tokens as legal tender, or by investing a countries reserves into digital assets to hedge against inflation. The industry is full of entrepreneurs and investors who are moving ahead at full speed, and the first countries to show support for these emerging technologies are set to gain tremendously by attracting jobs, talent and investments into their territories. Choosing an outright ban of crypto-currencies can make countries miss out on a huge opportunity for growth and high tech jobs, something that the entire world will need a lot more of after recuperating from the coronavirus pandemic.

El Salvador legalises Bitcoin as other nations plan similar moves

<p>Digital assets and cryptocurrencies like bitcoin, ethereum and XRP have often been called highly volatile and risky assets used by either speculators or dubious characters for dark web anonymous transactions facilitating illegal activities. Bitcoin has been around for over ten years at this point and it has proven to be useful for more than just speculation, and when it comes to using it for illegal transactions, it is not a clever solution to use a payment where the payment history is ending up on a permanent blockchain freely accessible.</p>

<p>The industries and companies that are developing technology using blockchain are now numbering in the thousands, and with more and more incentive to solve problems with fiat currencies, the industry is set to expand exponentially in the coming years. A fundamental difference between regular fiat currencies like the dollar, and bitcoin, is that the dollar is an inflationary currency that loses value over time due to money printing. Bitcoin, on the other hand, is a deflationary currency with a fixed, limited total supply.</p>

<p>Another characteristic of bitcoin besides the limited supply is the periodic halving of the reward handed out to miners processing transactions on the network and in turn increase the security of it. Currently, miners are rewarded with 12.5 bitcoins per block of transactions confirmed on the network, after the halving the reward will be reduced to 6.25 bitcoins per block. The next bitcoin halving is scheduled to happen on May 12, and investors are expecting that the digital asset will see new all-time highs as there will be a smaller supply of newly created Bitcoins.</p>

<p>When bitcoin halvings have happened historically, it has lead to a bull-market pushing the price of Bitcoin up dramatically in the months following the halving, which takes place roughly every four years.</p>

<p>Twitter handle PlanB @100trillionUSD has created a useful data model to explain these periodic cycles of price fluctuations in relation to the halving events:<br />
<br />
<img alt="Data Model" data-entity-type="file" data-entity-uuid="62d444e9-f7c6-4a9f-aae1-65abf35197fb" src="//cdn.wionews.com/sites/default/files/inline-images/medium_Com_PlanB_S2F_model%20%281%29.png" /></p>

<p>This model predicts that following the halving event on May 12, the price of bitcoin will rise into a new phase around $100,000 after the flow of new bitcoins into the market gets factored in and reflected into the price. The different phases of this model also take into consideration how the use case for bitcoin develops over time. In the early days, the most popular bitcoin narrative was “proof of concept”, in the next phase that changed to “payments”, followed by “E-gold” where the price of one bitcoin was close to the price of one ounce of gold. This model has proven its value over the previous halvings on the network, but it is worth noting that some of the scaling issues that appeared during the bull-market of 2017 are yet to be resolved.</p>

<p>Twitter user @C3_Nik states: “The Scalability issues surrounding #Bitcoin $BTC haven't been improved over the last few years. Nothing in terms of the technology has changed since the BTC network slowed down to a crawl and the average fee rose to 60$ in late 2017. It can kill the next bull run for BTC, easily.”</p>

<p>During all-time high bull-market of 2017, the network slowed down significantly, while the transaction fees rose to levels above what most people are comfortable with for smaller transactions, leading to a lot of investments flowing into altcoins where transactions were faster and cheaper.</p>

<p>@C3_Nik goes on to state “And this isn't some 'maybe', it is a proven fact. The data is there. Next time it will happen again. #Bitcoin $BTC will become unusable right in the middle of the next bull run. What will happen then? I hope that the market realises that there are better solutions that work.”</p>

<p>In the years following the launch of bitcoin, several other cryptocurrencies have been launched. One notable example is Ripple's XRP that focuses on international remittances and on-demand liquidity. While some people in the digital assets community think of Ripple as the banker's coin that does not follow the ethos of Bitcoin, Ripple labs went to meet with regulators as soon as possible in order to work with regulators and speed up the process of adoption and implementation. XRP is today the third biggest digital asset by market cap and has partnerships with more than 300 banks around the world. With all the developments in the recent months with the coronavirus pandemic and the economic fall out of that, there is now an added incentive for people to use digital payments instead of using cash due to the risk of getting infected. When the governments around the world are printing money on a large scale leading to inflation and the devaluing of their population's savings and retirements accounts, digital assets can, like gold and silver be used as a safe haven investment for protecting their wealth.</p>

<p>Whether or not the stock to flow model holds true and bitcoin reaches $100,000, the cryptocurrency industry is here to stay, and there are many other solutions than Bitcoin for secure digital payments. During these testing times, the future looks bright for digital assets.</p>

<p><em>(Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL)</em><br />
&nbsp;&nbsp;</p>

<p>&nbsp;</p>


Digital assets and cryptocurrencies like bitcoin, ethereum and XRP have often been called highly volatile and risky assets used by either speculators or dubious characters for dark web anonymous transactions facilitating illegal activities.

Digital assets and cryptocurrencies like bitcoin, ethereum and XRP have often been called highly volatile and risky assets used by either speculators or dubious characters for dark web anonymous transactions facilitating illegal activities. Bitcoin has been around for over ten years at this point and it has proven to be useful for more than just speculation, and when it comes to using it for illegal transactions, it is not a clever solution to use a payment where the payment history is ending up on a permanent blockchain freely accessible. The industries and companies that are developing technology using blockchain are now numbering in the thousands, and with more and more incentive to solve problems with fiat currencies, the industry is set to expand exponentially in the coming years. A fundamental difference between regular fiat currencies like the dollar, and bitcoin, is that the dollar is an inflationary currency that loses value over time due to money printing. Bitcoin, on the other hand, is a deflationary currency with a fixed, limited total supply. Another characteristic of bitcoin besides the limited supply is the periodic halving of the reward handed out to miners processing transactions on the network and in turn increase the security of it. Currently, miners are rewarded with 12.5 bitcoins per block of transactions confirmed on the network, after the halving the reward will be reduced to 6.25 bitcoins per block. The next bitcoin halving is scheduled to happen on May 12, and investors are expecting that the digital asset will see new all-time highs as there will be a smaller supply of newly created Bitcoins. When bitcoin halvings have happened historically, it has lead to a bull-market pushing the price of Bitcoin up dramatically in the months following the halving, which takes place roughly every four years. Twitter handle PlanB @100trillionUSD has created a useful data model to explain these periodic cycles of price fluctuations in relation to the halving events: This model predicts that following the halving event on May 12, the price of bitcoin will rise into a new phase around $100,000 after the flow of new bitcoins into the market gets factored in and reflected into the price. The different phases of this model also take into consideration how the use case for bitcoin develops over time. In the early days, the most popular bitcoin narrative was “proof of concept”, in the next phase that changed to “payments”, followed by “E-gold” where the price of one bitcoin was close to the price of one ounce of gold. This model has proven its value over the previous halvings on the network, but it is worth noting that some of the scaling issues that appeared during the bull-market of 2017 are yet to be resolved. Twitter user @C3_Nik states: “The Scalability issues surrounding #Bitcoin $BTC haven't been improved over the last few years. Nothing in terms of the technology has changed since the BTC network slowed down to a crawl and the average fee rose to 60$ in late 2017. It can kill the next bull run for BTC, easily.” During all-time high bull-market of 2017, the network slowed down significantly, while the transaction fees rose to levels above what most people are comfortable with for smaller transactions, leading to a lot of investments flowing into altcoins where transactions were faster and cheaper. @C3_Nik goes on to state “And this isn't some 'maybe', it is a proven fact. The data is there. Next time it will happen again. #Bitcoin $BTC will become unusable right in the middle of the next bull run. What will happen then? I hope that the market realises that there are better solutions that work.” In the years following the launch of bitcoin, several other cryptocurrencies have been launched. One notable example is Ripple's XRP that focuses on international remittances and on-demand liquidity. While some people in the digital assets community think of Ripple as the banker's coin that does not follow the ethos of Bitcoin, Ripple labs went to meet with regulators as soon as possible in order to work with regulators and speed up the process of adoption and implementation. XRP is today the third biggest digital asset by market cap and has partnerships with more than 300 banks around the world. With all the developments in the recent months with the coronavirus pandemic and the economic fall out of that, there is now an added incentive for people to use digital payments instead of using cash due to the risk of getting infected. When the governments around the world are printing money on a large scale leading to inflation and the devaluing of their population's savings and retirements accounts, digital assets can, like gold and silver be used as a safe haven investment for protecting their wealth. Whether or not the stock to flow model holds true and bitcoin reaches $100,000, the cryptocurrency industry is here to stay, and there are many other solutions than Bitcoin for secure digital payments. During these testing times, the future looks bright for digital assets. (Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL)

Explained: Bitcoin halving and the expected bull-market for digital assets

Author

Zee News Rajasthan

Editor

Johan Castell

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