This is a hot topic and good question to ask.
Dec. 19, 2016 -(one year ago) The average price per bitcoin was $790.16. Within the last 12 hours, the Bitcoin price has hit $19,719.
That is an increased value of +2396.08%.
Why has this been the case?
There are three factors to consider.
- The Petrodollar is not in a strong position internationally.
The petrodollar was created in the 1970's when President Nixon took us off the gold standard. At the time, a higher price for oil would benefit the U.S. economy. This is because of a deal made by the United States and OPEC nations who agreed only to sell oil in USD in exchange for military support and arms.
Today, higher oil prices hurts the US economy. The reason is because Russia, Venezuela and others need the price above $85 a barrel for their state run oil to break even. U.S. oil producers breaks-even at $65 a barrel with fracking.
China is now the world's largest consumer of oil.
What happens if/when China decides not to buy oil in USD but the Chinese Yen?
What could the US really do?
This has the potential to replace the US as the world reserve currency.
2 ) The Rise of the Shanghai Exchange and Far East.
The Shanghai Futures Exchange and its subsidiary Shanghai International Energy Exchange has in the last year readied themselves to except Russian oil in exchange for Chinese Gold. This is a direct challenge to the US-OPEC; petrodollar. The consequence of these actions will play out with time.
3 ) What a decentralized currency offers the average investor and companies who decide to adopt Crypto.
Crypto-Currency side steps the centralized banking, nation-state, Fiat currency meaning the people are no longer required to use the Monopoly money that Fiat currency is.
What about you?
Would you rather continue to use a currency that decreases in value with inflation(the hidden tax) or use currency they will be using in the future.
Bitcoin, will break through $20,000 and I suspect will only continue to rise (short something catastrophic like an EMP, World War, or major hacking event)
Bitcoin will hit $50,000-$100,000 by mid to late-2019.
What do you think?
https://oilprice.com/Latest-Energy-News/World-News/China-Readies-Yuan-Priced-Crude-Oil-Benchmark-Backed-By-Gold.html
https://www.coindesk.com/price/
https://en.wikipedia.org/wiki/Seven_Sisters_(oil_companies)