What does a Bitcoin bubble mean?

Bitcoin’s explosive rise over the last twelve months has seen many people stand up and take notice of the cryptocurrency. Its successful run has come amid heightened visibility in the online world and has seen much debate regarding the digital currency in the media and in official institutions as well. We are clearly seeing the breakthrough of Bitcoin into the mainstream as people all around the world are being introduced to it and with more interest comes more investment.

Bitcoin bubble
Bitcoin bubble

The positivity surrounding Bitcoin has seen its price rise from $552 in August 2016 to a peak of $3018 at the beginning of June 2017. However, since its peak, the price has wobbled and, at the moment of writing, stands at $2,485. While this is a still a healthy price compared to historic numbers, there are those who suggest that a Bitcoin bubble is growing and that this is a sign of it.

What does a Bitcoin bubble mean?

The surge in investment in Bitcoin could lead to demand outstripping supply while increasing the price of Bitcoin transactions. It is also suggested that the rise in demand for Bitcoin is not coming from people who are using the cryptocurrency but from investors who are looking to buy low and sell high and, considering Bitcoin’s impressive growth over the last year, these people have good reason to see it as a possibility.

So what happens if the Bitcoin bubble bursts? Simply put, the price will drop and those who are buying Bitcoin as an investment will lose out. However, those who are buying Bitcoin for use will find it cheaper. That said, there is no guarantee that it’s a bubble. Bitcoin has already seen sharp rises and hard landings before. In 2013, Bitcoin reached $1,000 before dropping to $200 a year later. But, as we have seen, it has recovered spectacularly. Another positive for Bitcoin is that the digital currency’s surge in 2017 has come on the back of legislative moves in several different countries such as Japan, Russia, Mexico and Australia that seem to be bringing the cryptocurrency further into the mainstream.

What does it mean for online gambling?

At the moment, Bitcoin’s price is good for gamblers who later exchange Bitcoin for other currencies as its value is still strong. It is somewhat restrictive for those who buy Bitcoin as the price is higher but if you win big on Bitcoin, changing it into another currency will guarantee a big payday. If the price drops, it means that gamblers buying Bitcoin with other currencies will pay less so there’s no downside for Bitcoin gamblers. Those at risk are the Bitcoin investors.

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