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A representation of bitcoin is seen in front of a stock graph in this illustration
Reuters

Bitcoin is the future of global currency, and the government's movements to introduce monetary policies and regulations around cryptocurrency only strengthen that claim. And with FTX's failure it goes to show how an independent centralized exchange was never going to be the answer, combining existing regulations and policies with a decentralized system is the logical evolution.

More and more companies are accepting Bitcoin as payment; Banks and insurance companies are providing customers with Bitcoin friendly services - from Bitcoin rewards to access to Coinbase; Citizens of countries that are faced with high inflation are trading in Bitcoin and countries such as El Salvador and The Central African Republic have introduced the cryptocurrency as legal tender as their fiat systems become unsustainable. They are facing hyperinflation because there is a limit to inflation - you can only print so much money before it becomes worthless.

One of the main reasons people and nations of the world are adopting Bitcoin is because of its scarcity. There is a finite supply of Bitcoin and therefore is not susceptible to inflation. By approximately 2140 all 21 million Bitcoins will have been mined, and every four years or so up until then the number of Bitcoins you can acquire through mining gets halved. Bitcoin's value comes from its scarcity, therefore halving its output every four years will increase its value. To put that into perspective there are only 1.9 million Bitcoins left that haven't been mined already.

This means that investing in Bitcoin is investing in inflation. It will beat the value of inflation on any investment portfolio.

The Biden administration can see the power of Bitcoin and knows it needs to introduce monetary policies and regulations. Quickly.

The FTX collapse may hurt crypto's reputation, however, it will bounce back as it becomes clearer that FTX was acting as a centralized system and was destined to be corrupted, it served as a safe option for many investors in an area of uncertainty but ultimately served against exactly what cryptocurrencies aim to solve.

It could be argued that having banks and governments involved in crypto will also go against the point of having them in the first place. However, increased financial security and monetary policies surrounding cryptocurrencies will not take away from their decentralized nature - banks will not be able to become intermediaries as they are with fiat currencies. The core of what makes cryptocurrencies so appealing will stay intact, the regulations will only serve to add customer protection against criminal activity and validate the currencies on the global stage.

The logical evolution of Bitcoin and cryptocurrencies is to have a decentralized wallet (for which you have the keys) that can be monitored by governmental bodies to ensure laws are being obeyed, taxes are being paid, and your money is protected against fraud. As existing financial infrastructure combines with a decentralized system it will only bolster adoption among the masses.

Counterintuitively, the current volatility of Bitcoin makes it more appealing. While it may look like its substantial drop in value recently means it is not safe to invest in it. It's because of the aforementioned 4 year halving cycles (among other things, like money taken out of crypto investments to cover losses in stocks and revenue due to inflation and the recession fears). This is bitcoin establishing its new floor value, which mirrors its peak from the last 4 year cycle (~$20,000). Meaning that in the next cycle it will again reset its floor value to its most recent high (~$70,000) with the next high predicted to be upward of $200,000.

The numbers will vary depending on who you ask, but nearly all Bitcoin experts agree the cycle will continue. Meaning the value of any Bitcoin you own will be well ahead of inflation. Eventually it will stabilize as its market cap increases, and its market cap will increase as more of the population adopt it, and more of the population will adopt it as governments and financial institutions introduce regulations and policies.

Any financial advice taken from an opinion piece should always be followed by thorough research, however, in the last 10 years Bitcoin has managed to disrupt the financial market in a way that puts control back into the hands of the average citizen - think of what it can do in the next 10 and beyond.

High-return investments are normally reserved by the banks for those with a high net-worth, but with Bitcoin anyone is able to invest in it and gain what I am sure to be some incredible returns - now with added security. Investing in Bitcoin is investing in inflation. All you need is a decentralized wallet and to HODL as Bitcoin becomes the currency of the future.

Jess Davis is CEO of Uberstate Inc, A Global Banking as a service platform for business and consumers. Uberstate has developed a fully regulated platform for the automation of liquidity in digital currency and assets alike.

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