Is It a Blessing or a Curse If The Red Dragon Controls the Future of Bitcoin?
Note: Zhang Hucheng, president of Beijing Youchoose Wealth Management Ltd., is the host of Hucheng Lunjin, a talk show focusing on finance and economics. As a young entrepreneur, he was selected as China Economic Person of the Year in 2014 by Xinhua net. He talks about three worst possibilities of the future of bitcoin.
The price of a bitcoin has surpassed the price of one ounce gold for the first time ever, reaching more than 1290 per unit last Friday. Are you starting to persuade anyone around you to buy bitcoin?
When be asked whether the timing is good to invest bitcoin, Zhang expressed his concerns about the worst outcomes of bitcoin.
﹒It could be dethroned by other digital currencies.
Among over 700 forms of digital currencies, Bitcoin might currently be getting the lion’s share of media attention, as far as digital currencies go. But such digital currencies as Litecoin also maintains strong momentum. Created to improve upon bitcoin by using open source design, bitcoin represents the second most popular type of digital currency. As we live in a world of competition, where adaptation through survival of the fittest is the key, it is too early to say bitcoin will remain the king of all cryptocurrencies.
﹒It could be banned by the Government.
This only stands a slight chance. As conservative as the PBOC is, it has realized digital currency is the future and is planning to issue its own digital currency. Plus, as a child of the Internet, it would be too costly and nearly infeasible to ban bitcoin.
﹒Bitcoin might be controlled by Chinese investors
China’s individual investors are known for their huge appetite for new assets. And they quickly saw a decentralized currency not manipulated by the People Bank of China as a wonderful thing and acted on it. China now is definitely a part of Bitcoin’s future, it has increased and maintained a massive market share in Bitcoin. And only time will tell if it is for better or worse.
In closing, Zhang believed that bitcoin is not a good investment. He suggested that only a small portion of capital should be invested and investors should be prepared to lose it all.