Full year 2016, Bitcoins were up by 121%
In a world where the value
of fiat currencies is being called into question on account of reckless money
printing by central banks, the virtual currency Bitcoin found many takers.
The cryptocurrency has hit its highest level since December 2013. For the full
year 2016, Bitcoins were up by 121%. That made Bitcoin the best performing of
all the asset classes in 2016.
Sharp Surge in Value of Bitcoins
Before you regret missing
out on the returns, let us shed some light on aspects of this asset class.
Bitcoins were launched in October 2008 with a dollar value of zero and no government backing. This means unlike other currencies, Bitcoins have no central bank backing.
Bitcoins were launched in October 2008 with a dollar value of zero and no government backing. This means unlike other currencies, Bitcoins have no central bank backing.
Further, bitcoins do not yet
come under any regulations. With zero collateral and prone to
illegal use, the currency is seen as a systemic risk.
And if bubbles have already started forming in Bitcoins, logic suggests that somewhere in the future this bubble will burst.
And if bubbles have already started forming in Bitcoins, logic suggests that somewhere in the future this bubble will burst.
The chances of the bubble bursting could be
higher if governments and central banks find some way of regulating it.
