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SegWit2x: Keep Only As Many Bitcoins As You Can Afford To Lose

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SegWit2x: Keep Only As Many Bitcoins As You Can Afford To Lose

There is a continuous evolution going on in the investment ecosystem. This development keeps becoming more obvious as the days go by. Events surrounding the financial technology industry prove that digital technology is a crucial part of the next phase of industrial revolution that will be experienced by the global economy.

A key element for the future

At the G20 summit held in Hamburg on July 7-8 2017, speaking about the development of digital technology, Russian President, Vladimir Putin said:

“We believe that the G20 will take a leading role in shaping international regulations in this area, improving international financial systems so all economies can benefit from it, including in the developing world remains high on the G20 agenda.”

Digital technology exhibits a robustness that cuts across almost every area of human development. Over time, digital assets have evolved in a way that investors are now considering them as key elements in the future of global financial systems.

Kumar Gaurav, Founder at Cashaa (Auxesis Group) explains to TTMNews that digital assets started from when media or other documents were being created with or stored on a digital device, such as computers or mobile phones.

The crypto evolution

According to Gaurav, cryptocurrency is a kind of digital asset that came into existence with Bitcoin in January 2009. In June 2013, “Bitcoin 2.0” started: Coloured Coins were invented to represent any kind of asset on the Bitcoin blockchain, and in 2014, Counterparty, Omni and Bitshares started to enable companies to create tokens representing shares and dividends.

Over the past year, Ethereum has become the platform of choice for most blockchain-based digital assets, due to its ease-of-use, its potential to run whole organisations on a blockchain using smart contracts, dapps and daos, as well as its strong community using the Ether gains to invest in companies building on Ethereum.

Checking out digital investments

Gaurav notes that blockchain-based digital assets bring numerous advantages, they can be traded 24/7, by anyone anywhere at no minimum or maximum amount, at no opening costs, with a clear history of transactions, with no central party being able to block or restrict your activity, and with the possibility to trade anonymously.

However, he advises that any investor in digital assets must look at what value there is behind the cryptocurrency or other token, what it represents, if there is a real world need for it, who the people are behind it, and whether the usage of blockchain technology makes sense in the respective use case.

Bitcoin is an influencer

Bitcoin is the pioneer cryptocurrency within the digital asset ecosystem, it is also the most capitalized digital asset in terms of market size. Events around the Bitcoin community often induce ripple effects across board, affecting other altcoins and cryptocurrencies.

Gaurav tells TTMNews:

“Bitcoin is the only cryptocurrency that can influence the whole market, as altcoins have always been moving either parallel or in the opposite direction. If any new coin or token comes up, the closer it gets a market cap close to Bitcoin`s, the more likely people will not only look at the value behind it, but will also simply buy and sell in accordance with buying and selling Bitcoin.

With RSK coming, Bitcoin`s influence will be even higher as some companies will switch from using Ethereum to Bitcoin”.

As the Bitcoin community nears a major scaling decision date, most holders of the cryptocurrency are caught in the middle of significant uncertainty. Several analyses of the impact of different possible outcomes currently exist within the crypto space. Ultimately, paramount on the minds of holders is the safety of their investments.

What to do about Bitcoin scaling

Gaurav recognizes this as a period of uncertainty. He upholds the philosophy of holders keeping only as many Bitcoins as they can afford to lose.

He explains:

“Currently, it looks like there will be enough support for Segwit2x, with 87.8% of the network intending to signal support following 21st July. In case the required 80% will not signal support by 1 August, part of the network will activate Segwit via UASF, in which case as it will only be a minority to do so, there will be a chain split. It is therefore recommended that around 1 August, Bitcoin is kept in cold storage and no transactions are being made until the outcome is clear.

As the scaling issue has been the reason for the Bitcoin price decline, if it is solved in a smooth way with an activation of Segwit2x, the Bitcoin price will go up again, with altcoins either declining as people will switch back to Bitcoin, or more likely, as the recent decline has affected all coins, this time the whole market moving parallel to Bitcoin, too.”

Gaurav also notes that both the current main reasons for recent weeks’ decline can be seen as growth pains, explaining that to have a scaling debate, there first needed to be the huge popularity of Bitcoin to make this relevant.

Same for ICOs cashing out and causing a decline in the price of Ether, where there needed to be the huge popularity of Ether over the past 3 years, to enable current ICO sizes. However, investors may not be noticeably hurt if something goes wrong, as they are spending from their Ether gains, which was as low as 0.42$ in October 2014 and almost 400$ at its all-time high.

The concept has already been around for 3 years with smaller amounts and is likely here to stay. Therefore, when the current hype is over and ICOs return to their initial smaller sizes closer to what they would raise on the traditional way, the Ether price will become more stable again.

Entrepreneur, philanthropist, software engineer, photographer, founder of Expanse, President of the Borderless #Charity, CEO of Borderless Corp.

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