As crypto finds its place in the economy, it will become far less volatile.
The superstar developer thinks that as crypto finds its place in the economy, it will become far less volatile.
In his recent interview, Ethereum co-founder Vitalik Buterin predicted that crypto market volatility will slow to that of gold and stocks in the medium-term. However, he did not give a specific price point at which he believes this will happen. This is a positive sign for the future of blockchain technology, as it shows that the market is maturing and becoming more stable.
The developer also spoke about proof of work, proof of stake, and the reluctance of Bitcoiners to embrace the latter. He said that while proof of work is a tried and tested method for reaching consensus, proof of stake has advantages that make it worth considering. However, he noted that many Bitcoiners are reluctant to embrace proof of
Crypto Prices Settle After Big Swings
I'm surprised that the current crypto bear market hasn't taken effect sooner. Prices were high, and I was sure they'd eventually drop – I just didn't exactly know when.
“It feels like people are reading too much into what is ultimately cyclical dynamics that crypto has always had and probably will continue to have for a long time,” he said.
Bitcoin's price has risen steadily across each market cycle, but the asset's percentage return has also increased with each boom. This indicates that demand for Bitcoin is growing stronger with each cycle. With the halving of Bitcoin's supply issuance rate, we can expect the price of Bitcoin to continue to rise in the long term.
It is interesting to see that even though Bitcoin and Ethereum are both cryptocurrencies, they are still following different paths when it comes to price stability. While Bitcoin seems to be following an adoption curve, Ethereum is still maintaining its volatility. This could mean that Ethereum still has a lot of potential growth left, as more and more people adopt it as a means of payment.
“I definitely think that in the medium-term future cryptocurrencies will settle down and be only about as volatile as gold or the stock market,” he predicted.
I believe that crypto asset class is here to stay and will only grow in popularity and usage. While its exact role in the market may shift and change over time, I believe that it will become more and more accepted and mainstream. Its potential limits are still being explored, but I believe that the sky is the limit for this innovative asset class.
In his scenario, crypto would replace gold as a store of value and become a “Linux of Finance” by 2020, but would not become mainstream. This would reduce the odds that crypto will “either disappear or take over the world completely in 2042.”
Vitalik doesn't expect cryptocurrencies to replace traditional currencies, but I believe that they will eventually become the norm. With the way the world is moving towards a digital age, it only makes sense that our currency would as well. Cryptocurrencies have the potential to revolutionize the way we interact with
Bitcoiners oppose merge with Ethereum
Ethereum is scheduled for “The Merge” next month – its permanent transition to a proof of stake consensus mechanism. The Ethereum Foundation says the upgrade will make Ethereum more efficient, secure, and scalable. This is a big deal for the Ethereum community, as it represents a fundamental shift in how the network functions. The proof of stake consensus mechanism is seen as more energy-efficient and environmentally friendly than the current proof of work system, and it is also believed to be more secure and scalable
As the debate around the future of Bitcoin continues, those who support the proof of work system argue that it is necessary to maintain the network's decentralization. On the other hand, those who advocate for alternative systems believe that proof of work is no longer necessary or effective. It remains to be seen what direction the Bitcoin community will ultimately choose to go.
In his opinion, proof of work is not only bad for the environment but also less secure than proof of stake. He argues that the energy required to defend the network makes it necessary to constantly reward miners with new coins, which in turn funds the network's security.
Bitcoin miners will increasingly rely on transaction fees to subsidize their operations as the block subsidy declines over time. This will help to ensure the continued security of the Bitcoin network.
As Bitcoin's fee market is much smaller than Ethereum's, it may not be able to maintain its current energy security in the future without a subsidy. This could leave it vulnerable to attack.
“If Bitcoin actually gets attacked, I do expect that the political will to switch to at least hybrid proof of stake will quickly appear, but I expect that to be a painful transition,” concluded Vitalik.
In a recent interview, Ethereum co-founder Vitalik Buterin stated that he believes that cryptocurrency volatility will eventually stabilize, much like how gold prices fluctuate over time. Buterin noted that while crypto prices have been highly volatile in recent years, this is to be expected with any new asset
