One of the main problems that cryptocurrencies like bitcoin has to face is that governments are unwilling to recognise them. In this post about Libra, we have explained the reasons briefly.
Recently, Judge Beryl A. Howell stated in a sentence that Bitcoin is a type of money, which is a very important step in Bitcoin history towards general recognition.
It is curious how one of the reasons that the “official system” has always used to attack Bitcoin has been the reason to the recognition. The enemies of Bitcoin have claimed, not without reason, that it is used for illegitimate transactions (as if fiat money was not).
Actually, when the judged stated that Bitcoin was money, she was judging a drug case in which the recognition of Bitcoin as money allowed her to sentence a man that was accused of selling drugs. If there is no money in the exchange, there is no selling, the defense claimed.
What is in it for investors?
The recognition of Bitcoin seems to be another step towards the generalisation of its use. As result and as usual, the market of the crypto is moving with huge volatility.
The fact that the price is rising, may be linked to this good news, plus the fact that recently there was a halve in Bitcoin’s production has made the asset scarcer in the eyes of investors.
Moreover, VISA and MasterCard have showed a bigger interest in working with cryptocurrencies, and bank entities in the U.S. now have the license to offer a service to guard cryptocurrencies for their clients.
A few weeks ago, after partnering with Paxos, PayPal also informed the European Commission of its intent to offer services related to cryptocurrencies.
This is all very good news for this controversial asset. As a result, Bitcoin, which was priced GBP 7,238.90 on July 20, is on GBP 8,452.86 when this article was written on July 29.
However, as we always say, it is not a good idea to follow the market after the news is released because chances are the investor will arrive too late and not place himself in the best position.
It seems reasonable to think that in the coming months we will see traditional companies offering investors the chance to invest in cryptocurrencies. Be careful! The fact that a big company like PayPal or MasterCard offers you the chance to buy Bitcoin does not mean that you should or should not do it. Always do your own analysis before investing; and if you are not sure, it is not likely a good option for you.
Remember that there is also a conflict between the chance of becoming rich and the risk management to avoid huge losses.
*Nothing in this article is or should be taken as investment advice.