Forget HODLing, Is Spending The Only Way To Revive Bitcoin?

Bitcoin has been on a downhill trajectory for the year and the bloodbath looks unlikely to stop. The currency is down over 80 percent from its record high and has been oscillating between $3,000 and $3,500. The other cryptocurrencies haven’t fared any better, with Ethereum unable to stay above $90. While many analysts have promised us that a massive bull run is on the horizon, they have misled us to think that HODLing is the best move to stop the plummet in prices. It’s not, spending is – here’s why. 

We Had the Answer All Along

Cryptocurrencies, Bitcoin especially, have been compared to gold. Gold is one of the most widely accepted stores of value globally. Bitcoin’s volatility has been cited as the reason it can’t replace gold as a store of value. Although the crypto community has consistently made efforts to turn the virtual currency into the gold of the internet, the challenges have been immense. It seems we may be asking for too much from a very nascent asset. We need to give it time to follow the same path gold took.

Before gold became the precious metal it is today, it was first used as money. This was the first step in giving it value. In 600 B.C, the kingdom of Lydia in modern-day Turkey became the first people to declare gold as currency. In the centuries that followed, gold became widely accepted as currency, being used and accepted globally.

Bitcoin is only a decade old, and the fact that it’s being compared to gold is already an achievement by itself. However, it needs to first become widely used as currency before it can become a store of value.

The Fundamental Challenge for Bitcoin

As Bitcoin asserted itself in the financial world, many merchants began accepting it as a method of payment. From global giants such as Microsoft, Overstock, Christie’s, and Expedia, to the neighborhood coffee and pizza joints, paying in Bitcoin was taking root. Then came the price crash, and all the progress was wiped out.

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