So, does anyone really have a crystal clear idea of what the future of bitcoins is? There are a lot of people who have made a business out of speculating on the future of the virtual currency. They have a whole range of different theories as to how it might evolve, where it might end up and who knows what might happen in the future. Is all of this just a bunch of hype, or is there some real meat to it? Are these people right about their speculation? Let's look at this shall we?
There is no way that I can predict where the currency will go next, what the future holds for it is anybody's guess. What I can tell you though, is that there is going to be one major inflection point, which will happen on October 31st, the date when the Chinese government makes an announcement regarding the circulation of new virtual money in the country. It was also recently announced that the Chinese government will be allowing a certain amount of foreign trading on the currency, during which they will effectively monopoly in the foreign exchange industry. At that time, nobody has a clear idea of what will happen with the currency, but experts have started projecting gloom and doom.
Many believe that the world will end up without gold, as the paper money that is in circulation will fail. Others believe that gold will once again become a force to be reckoned with, and that nobody really wants it to go away. This last statement is what I call the paranoia factor. After all, history shows that when a thing becomes wildly popular, the individuals who were predicting its downfall are the first to be thrown into prison.
The big question now is where will all of this leave the average trader. Will he still be able to make some money on the futures market? Or will everybody be moving towards the futures market? Will the central banks of the world interfere with the futures market, crushing the profitability that traders were counting on? Will the government try to de-value the currency before it reaches a point where it becomes valuable again? Well, let us explore some possibilities here.
If you take a look at the current situation in China, you will notice that it is looking like a consolidation of the trades that are taking place in the forex market. At the same time, the Chinese government is trying to figure out how to get their economy back on track, and one way that they are trying is to prevent the over-trading in the forex market. At the same time, they are making it mandatory for anyone who trades on the margin to be Chinese. They know that the only way for their economy to grow is if the capital that they are using to finance it is coming from an artificially limited pool.
Another interesting possibility arises whenever there is a disagreement within OPEC. In order to balance the books, they are allowing oil to rise above $100 per barrel. This seems like a crazy step, but it could really have a domino effect on the other commodity markets as well. When this happens, everybody will suddenly become very concerned about their income. Of course, this can lead to panic buying at the moment when the price of gold is at an all-time high.
One prediction that I like to make about the future of the market is that there may be a bubble building up in the financial market that will eventually burst. This seems to be what happened with tulips in the Netherlands a few years ago. However, it will take a very long time before this happens. The only thing that is certain is that the United States is not going to sit around and wait for the bubble to burst, which will almost certainly occur sometime in the next five to ten years.
As always one must take one's forecast with a grain of salt. There are too many variables that come into play. You can never be sure that all of the predictions that you see will come to fruition. If you are planning on investing some money into the market in the near future, make sure that you do not blindly trust any of them. Rather, do your own research and only consider those that you can afford to lose.