The Bitcoin community has been buzzing about the upcoming hard forks planned for the world’s leading cryptocurrency.
Virtual currency users are excited because hard forks have the potential to increase the security, efficiency, and ease of use of the coin. Similarly, virtual currency investors are looking forward to reaping the benefits of new high-value forks.
However, with several hard forks on the horizon, investors may feel overwhelmed by the up-and-coming Bitcoin derivatives. Bitcoin Interest, a new hard fork that provides an interest-bearing service for virtual currency holders, stands out among the crowd. After the Bitcoin Interest fork, virtual currency holders for the first time will be able to earn a return on coins they are saving rather than spending or trading.
Bitcoin Entrepreneurs Launch New Coins Through Hard Forks
Hard forks are basically software updates that create new versions of Bitcoin. The first hard fork occurred just a few months ago, but Bitcoin forks are becoming increasingly attractive vehicles for capital raises by talented tech entrepreneurs.
Unlike the increasingly volatile marketplace of Initial Coin Offerings (“ICOs”), coins created through forks on the Bitcoin blockchain benefit from the legitimacy of the world’s leading cryptocurrency. Using the established Bitcoin currency platform to launch the next big cryptocurrency through a hard fork is an effective way tech entrepreneurs can raise capital without contributing to the volatility of the overall market.
A handful of new forks have been released in the last few days of 2017. However, some of these forks create little to no value for Bitcoin holders, despite the one-to-one payout they are entitled to if they held Bitcoin at the time of the split. Recent forks like Super Bitcoin or Bitcoin Uranium appear to be more of a technical experimentation than a serious enterprise. With so many forks planned for the Bitcoin blockchain, many investors are wondering how they are supposed to know which hard forks will create real value for their portfolios.
Bitcoin Interest – a Hard Fork with Real Market Value
Bitcoin Interest is a hard fork planned for the Bitcoin blockchain that will create a new financial product that we’re all very familiar with already: the interest-bearing savings account.
Volatility and speculation have been substantial issues for most blockchain companies. However, Bitcoin Interest stands out because of its relatively low risk and stabilizing effect on the market as a whole. Offering interest on virtual currency will encourage people to hold coins rather than trade them. Overall, this will help stabilize virtual currency markets by encouraging people to save coin rather than speculate with it. As a result, Bitcoin Interest may prove to be among most valuable forks investors have seen so far.
Bitcoin Interest – A Sign of an Evolving Crypto Market
Bitcoin Interest takes an old idea – the interest-bearing savings account – and introduces it to an entirely new market: cryptocurrency investors. This will not only stabilize a famously volatile investment, it will give new virtual currency users a familiar way to manage their savings.
Anyone who holds Bitcoin at the time of the fork will receive Bitcoin Interest Coins (“BCI”) equal to their Bitcoin holdings. If BCI is “parked” rather than spent or traded, the coins will earn interest payments similar to savings accounts in traditional banks. BCI holders earn interest based on the number of coins parked in their accounts, as well as how many other users are parking their coins in the active interest round. As a result, users earn more for saving their own coins and when BCI market participation increases.
Bitcoin Interest is a much-needed safe harbor for virtual currency holdings. In the volatile and complex world of cryptocurrency investment, products that mitigate risk are critical. Bitcoin investors can look forward to seeing the benefits of BCI when the fork occurs in January of 2018.