Will Bitcoin Reach $50,000 in 2018?

Cryptocurrencies and especially Bitcoin more than caught the attention of investors in 2017, they became infatuated with it. Bitcoin started the year of 2017 at $963.38 and ended at $13,850.40 for a gain of 1,338%. It nearly reached $20,000 coming close at $19,870.62 on December 17. This has led to Bitcoin and other cryptocurrencies getting huge media exposure and the creation of thousands of new ones.

There are many reasons that Bitcoin will Reach $50,000 in 2018.

1. Limited to 21 million Bitcoins
   At most there will be 21 million Bitcoins (or there are supposed to only be 21 million) “mined” or created. The first one was mined on January 3, 2009 and there are currently about 16.8 million in “circulation.”

1. First mover, network effect and media exposure
   What is unique to Bitcoin vs. other CCs is that it was the first one invented, gained acceptance by investors and businesses and has received the most media attention. New companies have formed to support and trade it, which has led others to take notice and try and cash in on the hype.
   Since there isn’t anything physically attributable to Bitcoin, having these qualities has been a huge help for it to gain traction. I am counting these three as one reason as they have a synergistic effect on each other and help create demand.

1. FOMO or Fear of missing out
   The fear of missing out, or FOMO, has helped to create a lemming effect. Investors don’t want to miss out on the next big thing and to a degree also want bragging rights that they own Bitcoin.

1. Lost keys
   People lose and misplace things they own and amazingly enough it also happens with CC keys. While CCs are secure if the owner loses, misplaces or sometimes donates the computer device that has the CC key it is probably lost forever. Kimberly Grauer, Chief Economist at Chainalysis, estimates that 23% of CC keys have been lost which lowers the supply.

1. Harder and costlier to mine them
   Bitcoin mining was set up so that as more are created it becomes harder to produce the next one. And since mining is accomplished solely by computers it is taking more compute power to create them. This leads to higher system and energy costs.

1. Hoarding
   Hoarding of Bitcoins could occur as their owners expect their value to increase. While this could limit the supply of Bitcoins this can occur with any asset. At some price owners will decide to part with them.

1. Lightning network
   The Lightning Network is a "second layer" payment protocol that operates on top of a blockchain (most commonly Bitcoin). It enables instant transactions between participating nodes and has been touted as a solution to the bitcoin scalability problem.

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