Bitcoin touched an all-time high of above 1400 today. News of the SEC reconsidering Winklevoss ETF proposal mainly fueled this rise. Japan’s legalization of Bitcoin as a payment method since April has also boosted investor sentiment.Growing regulatory acceptance by Japan and the Philippines, key markets like India considering introducing Bitcoin regulations and increasing number of vendors accepting Bitcoins globally have all aided the currency’s surge till now this year.
But Bitcoin has certain key issues to overcome to be able to continue with its upward momentum:
1) Fork Resolution
With growing popularity, Bitcoin now faces the issue of scalability as its 1 MB cap on block size is causing congestion. There is growing debate about increasing the size of the block which has resulted in two camps (Segwit – want to keep the block size to 1MB, Bitcoin Unlimited – support increase in block size). Non-resolution is only increasing transaction cost and causing more delays. For Bitcoin prices to go north, a quick resolution of the fork is imperative.
2) Increasing regulatory support
Though the list of countries advocating Bitcoin is increasing, it’s adoption worldwide still remains inconsistent. Bitcoin still has a long way to go in achieving unquestionable legitimacy and widespread adoption. SEC’s approval of the Bitcoin ETF would be an important step in this direction and may help boost prices, but whether it’s coming soon is a big question mark
Overcoming challenges of technology upgradations, regulation, and legal legitimacy might potentially give a big boost to Bitcoin prices this year.
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