Financial Institutions in the world reportedly have started to include Bitcoin. However, the major products being launched, at the moment, are investment and trading related. While this adds credibility and security to the asset, it makes it a speculative asset nonetheless.
Moreover, gold has limited use, but people all around the world still value its lustrous property. Bitcoin is an efficient store of value, but its transaction capabilities restrict it.
The average fees of each transaction on Bitcoin is again on the rise as the number of transactions is increasing. Marc Bevand, a Twitter user, published his discovery on of the transaction fees problem that has crept us again. He tweeted,
“Bitcoin hit 19 BTC in pending tx fees. It’s an 11-month high, since Jun 20, 2018. Translation: mempool is filling up, tx fees going Average tx fee over the last 6 hours is 3-4 USD. “
Bitcoin Average Transaction Fees (Source)
Vinny Lingham also expressed his apprehensions about the transaction capability and inflation in Bitcoin that might restrict the growth in price. He tweeted:
The only major concerns I still have right now are : 1) fee stability/inflation impacting the network, 2) if Satoshi’s coins ever moved
The reward for mining Bitcoin is currently higher than the spending rate or the growth rate of the entire network. Hence, there is considerable inflation, even at $8000 price levels. Nevertheless, with the lightning network in development and Bitcoin halving next year, the current transactions inabilities of Bitcoin will have improved a lot. However, at the current economic levels, it looks like a FOMO buy.
Bitcoin inflation rate chart (Source)
Peter Brandt questioned the market sentiments and the scale of the increase in price recently.