Yes, Bitcoin will continue to rise because it is inevitable, inevitable, but there is also an inevitable, inevitable point of collapse. This rule applies to all cryptocurrencies that have the specifications of Bitcoin, there is an inevitable rise and an inevitable point of collapse for each currency. We have learned a lot over the past years, especially from the collapse of Terra UST and Terra Luna and Binance burning billions of tokens to reduce their supply and thus return to trading at a high price. However, the two currencies were unable to return after that except with structural changes, and with their collapse, Bitcoin and the cryptocurrency market also collapsed.
After Bitcoin reached $68 in November 2021, it lost about 70% of this value, reaching $17,000 in November 2022. It has now been two years since that collapse, and today Bitcoin is back strong and massive, sweeping all the news and platforms with the price reaching $90,000, (336,241) Saudi riyals. I remember that I wrote in an article a year ago entitled (The most important lessons of the past that will remain with us for the future), “Bitcoin’s brilliant resilience means that it has acquired great legitimacy, and will take off into a horizon that is currently undiscovered, and the future will be very strange, as we have never witnessed it, and there is no recorded history for it, nor is there a known trend.”
Why is the rise in prices inevitable? Because the mechanisms of their production impose it, and to understand the mechanisms of production, we must understand how the idea of cryptocurrencies arose.
It originated in 1993 from a strange research on the idea of encrypting email to prevent spam and junk mail from reaching it. The idea is to raise the cost of accessing the server (for the non-specialist, it is the mail store and its processor. Here, he focused a lot on the phrase “raising the cost.” Raising the cost is not done by paying fees, but by making the person who wants to access the server go through several stages and solve several mathematical puzzles, which are not impossible to solve, but they take time and energy from the device.
After that famous research published in 1993, a series of studies were launched on this issue, (encrypting access to the server by solving mathematical puzzles), and these series of studies produced the idea of the blockchain, (block chains) where any process between two parties (a contract, for example) is processed by linking it in a series of numbers that cannot be deleted except by deleting the entire chain, but a very important issue remained in the blockchain, which is what produces this linking number.
To verify the validity of the process and that it is between two qualified parties, it was necessary to have the authority to enter the server and verify the validity of the process from an independent third party who proves the process in the chain (Proof-of-work). The authorities supervising the block chains granted this authority, such as the authority to access the mail server, but in 2008 the Bitcoin block chain appeared, and there is no authority that grants the authority to enter, but rather programs called mining. If a process takes place between two parties in the Bitcoin block chain, a third party must confirm its validity, which is the miner, as he solves mathematical puzzles (such as the idea of mail) and then if he succeeds in solving it, he is granted the right to prove the process in the chain and then he is given Bitcoin (a complex and encrypted electronic code that cannot be repeated) as a "reward and wage for him". Of course, the wage is in exchange for the cost of the time required to track the processes in the chain and also the cost of the energy that the program takes to solve the mathematical puzzle.
This task was very easy in the beginning, as the number of miners was small, and the operations on the Bitcoin chain were few, so the cost of accessing the operation and processing the mathematical puzzle to open the chain was less than a dollar, but this means that there is an “inevitable” link between the increase in the number of miners and the number of operations on the chain and the cost of mining, as the growth of the chain and the increase in the complexity of the mathematical solution will take more time, more devices and “huge” electrical energy.
If the coin is produced for the miner who has succeeded in reaching that electrical cost, complex equipment and time, then there is a margin between what he paid and the price of the coin in the market (which is his profit margin), so the marginal value of the coin will rise steadily, as long as the chain is growing, and as long as the cost of mining is growing, in other words the price of the last coin produced by mining will equal the price of the last deal on it.
