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Bitcoin vs Gold

Is this a Bitcoin or a Gold era? This question has stirred the people’s mind. Ironically, the bitcoin vs gold, Bitcoin values fluctuate as the gold values. Let’s clear one thing here, what is Gold and why did the Bitcoin and Gold prices cross?

Gold is basically the chemical element with atomic number 79 and has a physical worth. Whereas Bitcoin is a peer-to-peer currency in digital wallets. If we discuss the history of both the commodities, we come to know that Gold was traded by civilizations from 600 BC whereas Bitcoin usage started from 2009. However, only in few years 2009 to 2017, Bitcoin exchange prices have exceeded from zero to over $2000.

Bitcoin first captured the massive attention in media when its value raised to $1242 in November 2013. The price of gold was $1250 at that time. This was the time when the competition between gold and bitcoin began. Both values are fluctuating. Basically, this is a story of supply and demand which completely depends on the public’s demand. As we read in economics, higher the demand and lower the supply. So, we can say that Gold is rare but bitcoins are rarer because both have limited source. However, the mining process for both the commodities is different: hundreds of tons’ of Gold is mined every year through hardware processes like placer mining, hard rock mining, and gold ore processing. On the other hand, Bitcoin mining is the collection of bitcoins in exchange. By using specialized hardware, they make transactions clear and secure.

This comparison between Gold and Bitcoin is just a psychological more than anything. Because gold’s market value is $7, whereas Bitcoin’s value is $20 billion. But, Price of Bitcoin exceeded, is worth more than one ounce of Gold on 2 March 2017.

In addition, this comparison between both commodities is a positive sign for users. They can enjoy the fluctuations and new changes. But Bitcoin is a digital currency, it is not a commodity whereas gold has been known as a commodity for thousands of years.

Prices or values increase per ounce is not a big deal, and not that much important. However, everyone notices one thing that from 2009, Bitcoin is continually making its new highs every now and then. The purpose of comparing Bitcoin with gold is to provide complete satisfaction to its customer. Both Bitcoin and gold have a relationship in term of their prices. That’s why fluctuation in price creates a strong impact. There are more than 100,000 merchants who use Bitcoin for trade. Same with gold, millions of merchant still trade in gold.

 

Bitcoin vs Gold Comparison

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What we Learnt from 5 Major Bitcoin Crashes

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September isn’t even over yet and bitcoin has already shown three different reactions. From starting off with a $5,000 hit, then falling by 40%, and then recovering back to the $4,000 mark by Monday morning.

This post is going to add more light to some of the major bitcoin crashes we’ve experienced regarding bitcoin. In the end, we might be able to come up with possible reasons as to why bitcoin is so volatile and what predictions can be made for it in the future.

April 2013 – The Meltdown:

Back in spring of 2013, Bitcoin experienced a ginormous drop from $233 to $67 overnight. Which is a 71% drop.

The crash took place right after the currency was experiencing a surge of media coverage which drove it to above $200. While the currency had never crossed $15 before 2013, the mainstream led it to a new height, only to watch it fall down to a double-digit again.

Bitcoin Crash in 2013:

The majority of 2013, Bitcoin’s value was around $120. But, the prices boosted ten-fold in the fall and Bitcoin hit a mark of $1,150 in November. Then the prices came tumbling down to lower than $500 by mid-December.

This price chase was actually because many investors were experimenting with bitcoin for the first time. Also, exchanges like Coinbase had a simple user interface which made it easier for users to buy bitcoin.

 

The Mt. Gox Tragedy of 2014:

Once again, Bitcoin was on a roll, making great gains again after the 2013 bubble pop situation when in February, the price fell from $867 to $439. This triggered a slow phase for bitcoin that went on till late 2016.

This crash took place after the operator of Mt. Gox announced the exchange had been hacked. They later revealed that around 850,000 bitcoins were stolen which would be worth around $3.5 billion today. Furthermore, this incident created major doubts about the security of this digital currency and is responsible for the low-lying value of bitcoin the past couple of years.

 

Bitcoin’s Big Break in 2017:

Bitcoin price history: Back in early January, bitcoin crossed the $1000 mark after years and began driving up exponentially. By June, the cryptocurrency had reached $3000 however, it fell right back and landed at $1,869 during mid-July.

With the increase in demand for bitcoin and number of transactions, people began to notice that the digital currency was getting slower. Especially with its developers not being able to agree on how to update the software. This raised the speculations of a possible “fork” to occur which would be producing two different versions of bitcoin. Thus, the market experienced a fall and when the fork took place in August and produced a rival currency, Bitcoin Cash, no long-term harm was made to bitcoin.

The Great China Chill:

Once the market had settled over the fork and activation of SegWit2x, bitcoin had made another massive jump to $5,000 during the beginning of September. Only to plunge back down 37% and dusting off over $30 billion from its total market cap, by September 15. Although, it’s already on the track to recovery as its prices climbed to $4000 three days later.

Well, this can be summed in one word as CHINA. While there were numerous rumors as to how cryptocurrency trading would be banned in China, a response was given soon after as BTCChina, its largest bitcoin exchange, announced that it would be ending trade this month.

 

Lessons Learned from the 5 Crashes:

The last 5 years have included some heart-wrenching falls and drops that confirms how volatile the cryptocurrency is. Regardless of the reason being a major hack or a government crackdown, bitcoin has always managed to bound back. This is assuring for all those tensed bitcoin buyers who are planning to hold onto bitcoin for the long run. Today, the digital currency market is a lot bigger and is proving to stick around so, it appears that bitcoin is very well, a safe bet.

 

Story Credits: fortune.com

Image Credits: dnev.com

 

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Bitcoin’s Price Surge and Mining Hobby

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Roque Solis, president of the SoliSYSTEMS corp, never fictionalized that bitcoin mining equipment he credited in February would have already paid for itself and made money as well. SoliSYSTEMS Corp is a company which developed an EMV smart cards for electronic advantage transfer for the federal backing program.

Solis was powerless to ignore bitcoin by attending a number of conferences. So, he decided to do experiment new technology via mining. He wants to get the better handle on the technology, whether this technology has the ability to use in this company or not?

Then, Solis bought a Bitmain Antminer S9 for $2,400.

As a result, he mined 1.01BTC worth $2,584 in Bitcoin wallet, on this weekend. Solis said, “When I bought the miner, the price per bitcoin was around $1,200. I thought I’d break even in one year, but actually, it’s been about five months.”

This gain indicates that individual hobby mining is not profitable anymore. Distinct miners don’t have the capacity to compete with the companies in mining bitcoins. with the $600 below price, electricity and pool fees, a person needs 500 days to break even on miner investment.

Furthermore, the rise in awareness about the mining pool, the price is also getting higher. Solis’s experience shows that hobby miner can break even within few months.

According to the Solis, money’s amount is increased on daily basis with miner’s jump from $7 to $16 freshly.

Price Substances:

According to the Sean Walsh, rising price of the bitcoins motivates the investing behavior of the miners. It is a key process which supports the whole network by safeguarding its ledger. Walsh said, “There are a lot of metrics that actually matter, like the number of people that own at least one bitcoin, but nobody cares about that. It’s just price. It’s the one score that wakes people up, and when The Wall Street Journal and other financial publications write about bitcoin.”

While Google trend shows the similar stories of bitcoin and bitcoin mining. Price factor of the bitcoin is not only the reason of increasing interest hobby mining. According to the Walsh experience, bitcoin transaction fees were stable from last few years, those fees have seen an uptick.

Walsh said, “This has to do with the block size debate, because the network is a bit congested, and people are having to pay more to get their transactions confirmed.”

In past, 100 bitcoins were per day transaction fees. Then this fee reaches to 350 bitcoins a day.

And, by 1,800 bitcoins shaped daily, 350 bitcoins are near to 20% of that. This is a blunt difference, a year ago when 60 bitcoins were paid in fees and 3600 produced on daily basis.

Walsh said. “that’s a huge boot.”

He added, “I don’t know that [increasing transaction fees] are affecting people’s interest in getting into mining. People may not realize why it’s more lucrative to mine bitcoins now, but when they run the numbers, the payback period looks better than it used to.”

New Blood:

He added, “It’s very important for people entering bitcoin mining that they really understand how to calculate their revenue and expenses. They need to make sure their cost basis and operating costs are very low.”

Like, if a junior miner overspends on accommodating servers, then there’s a modification, they are over-leverage.

Bitcoin’s value was down about 20% over the last weeks of June. Walsh said, “normal respiration of an asset class.” So far, others are not experienced in investing process and might be unaware of these fluctuations in bitcoin’s price.

According to the Solis, “it’s all about learning through experience”.  The Antminer S9 is running in Solis’s company’s server room and in the presence of the groups of servers, he is unable to identify how much electricity is used by the miners. Solis says, “It is noisy, though,” and “Compared to the other servers, it’s very noisy.”

It is a machine with two particular boards with fans that rotate at 54,00 – 7000 per minute revolution.  Solis is not the only one person who interesting in bitcoin hobby mining.

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Is Crypto Ad Ban Going To Be A Blessing In Disguise?

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According to the most hot and circulated ICO news 2018 is going to be a year of ban for crypto ads. Internet’s largest platforms have already started to ban all sorts of crypto advertisements.

Even the giants of internet like Facebook and Twitter announced crypto ad ban last January. Reddit took the same decision way back in 2016. Google is being expected to do the same in the near future. It is quite obvious that almost all those websites which are short sure for traffic generation purposes would follow the same protocol in case of crypto industry. No doubt all that scenario was full of hurdles for the crypto industry. Even in terms of cryptocurrency startup it was a big barrier extremely difficult to be crossed. But the crypto researchers and markets entrepreneurs are not looking at it in the same way. They do believe that all that way full of hurdles might prove to be a road of success in the near future. Let us see why they are so much optimistic about it.

crypto ads

How Can This Ban Turn Into a Blessing?

Well for the time being it might be a bad luck for the crypto advertisement but according to various web platforms that are directly related to the crypto industry are quiet optimistic about it. For instance, a website which for the time being does not want to disclose its name due to several reasons, has exclaimed that it will offer its complete platform for the advertisement purposes of crypto. In other words it will lend a hand to make it possible for the crypto startups reach potential investment opportunities. Same idea has been presented by some other giants of the Silicon Valley. No doubt this act will turn that ban into a total blessing, however many things and options must be considered and availed respectively, before the proper implementation of that marketing strategy.

Main Reason Behind the Ban

According to a statement issued by social media giant Facebook the reason for such a drastic ban on crypto related advertisement was only because of the scams associated with the initial coin offerings that come under the definition of misleading or deceptive promotional practices. Especially those tokens which are offered at low prices on these advertisement platforms have proved to be the main target of scammers. Even the Securities and Exchange Commission has declared these tokens unlawful which according to it are securities and must be listed with the agency.

 

On the other hand, entrepreneurs and crypto analysts are agreed upon the fact that by banning such advertisements, Google, Twitter and even Facebook are going to lose a great earning opportunity.

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Last Time to Buy Bitcoin as “Unreliable Sources” from China Spook Markets

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A Chinese journalist published a new article saying that China is banning ICOs and exchanges. The news was a Google translated article from a Chinese Journalist who claimed to have spoken to some official. Since there is no confirmation from a government official and no formal statement of any sort has been released, we can say that this news is possibly fake.
As we all know, the last time China banned Bitcoin, they took it back just a few months after.

However, this news might just be doing everyone a favor as this is probably the last time you can buy bitcoin at such levels.

Don’t Forget…

Bitcoin will survive with or without China, they’ve changed their mind before and they can do it again.

 

News Credits: cointelegraph.com

Image Credits: bitcoinist.com

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