BITCOIN AT $500K, WHAT ARE THE POSSIBLE IMPLICATIONS?

Photo credit The price of Bitcoin went down to $62,000 after touching the $66k all-time high. What caused the sudden decline has not been known but the entire crypto market felt the effect of the dip.

Many analysts and Bitcoin lovers have been predicting that the price of Bitcoin will likely hit a $500k value before the next five years. Whether Bitcoin will hit this price mark or not is not something I am concerned about within this post.

Newton's third law of motion states that for every action, there is an equal and opposite reaction. The price of Bitcoin hitting $500k will be beneficial to many investors but at the same time will become a barrier to some others.

Bitcoin indeed has a divisibility factor but at a $500k price value, the bitcoin market will be affordable to mostly institutional investors. Small investors who have not joined the market may not be able to do so, because they need to invest a minimum of $50,000 if they want to record profit with an average percentage rise in the price of bitcoin. Those who still invested their peanuts will have to wait for a huge rise in value to record profit.

The daily trading volume of bitcoin may likely reduce at this level because people won't be able to make much profit short trading except when they are trading with up to 0.25 BTC. People will likely turn to altcoins that are still very much affordable to be able to make profits with cheaper capital.

Those who have Bitcoin at this price will be reluctant to sell their bitcoin because of the value it has, and there will be lower transactions on the Bitcoin blockchain which will promote lower gas fees for transactions.

In general, the bitcoin market that will exist then will be a tough one for every investor because making the g decision to buy or sell won't be easy.

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