The Future Of Money: Why Invest In Bitcoin?

Bitcoin is the world's largest cryptocurrency and has gained impressive success, continuing to soar in popularity. Bitcoin's unique features offer an array of advantages for investors. Its continuous growth, resilience in surpassing all-time highs, and status as an inflation hedge present it as a solid investment choice. The simplicity of trading Bitcoin, combined with its liquidity, opens up opportunities for both short-term gains and long-term investment strategies. These attributes underline why Bitcoin is not just a trend but a significant financial instrument in today's market, catering to a diverse range of investors.

Bitcoin's value has been increasing

Why Bitcoin's Value Has Been Increasing

Scarcity and Network Effect

Bitcoin has a limited supply of 21 million coins, giving it scarcity and potential value. Its decentralised nature and use of blockchain technology make it secure and resistant to manipulation, tampering and fraud. The more people that use Bitcoin, the more valuable it becomes, as it is a form of digital gold.

Halving Cycle

Bitcoin's value has historically increased after halving events, where the number of new coins created is cut in half. This reduction in supply, coupled with constant or growing demand, pushes the price up.

Macro Backdrop

Bitcoin was created in response to the 2008 financial crisis and the subsequent quantitative easing and money-printing by central banks. In an era of near-zero interest rates and vast money-printing, investors are turning to Bitcoin as a hedge against inflation and the devaluation of fiat currencies.

Adoption and Integration

More and more businesses and individuals are adopting Bitcoin, recognising its advantages over traditional fiat currencies. Its growing user base and integration into society increase its value and make it an attractive investment.

Advanced Trading Platforms

The rise of advanced trading platforms and AI systems has made it easier for investors to buy and sell Bitcoin at optimal prices, maximising their profits. These platforms provide valuable insights and analysis, helping investors make informed decisions.

It's a chance to make a profit

The main reason people are so willing to invest in Bitcoin is that it can turn them into overnight millionaires. You can earn Bitcoin by mining it and buying it at a lower price than the one you hope to sell it for. Trading sites play a massive role in the process of making money. These platforms are more than just marketplaces as they possess advanced AI systems that can help you sell your Bitcoins at the highest possible price, thus earning the highest profit. For example, the Oil Profit AI system takes all the data about Bitcoin on the market and analyses it to determine its future fluctuations. Bitcoin has a very high volatility rate, and knowing its future ups and downs is a massive advantage as you will know when the best time to sell is. The rise in value, combined with the intelligence that trading sites provide, is the perfect recipe for making a massive profit.

The price of Bitcoin will keep growing as more people invest in it. This is beneficial to Bitcoin investors as the demand and value of Bitcoin will increase with more people using it as their primary currency. As more businesses understand that Bitcoin is the ultimate solution to their everyday problems of handling money, it will attract both small and large businesses. The more people love Bitcoin, the higher its price in the market. It is only a matter of time before Bitcoin increases the profits of its investors.

Bitcoin is also a hedge against rising inflation. Some argue that the limit in Bitcoin's supply cap makes it a safe hedge against the rising inflation of the global economy.

It's a stable, censorship-resistant store of value

Bitcoin is often referred to as "digital gold", and it's not hard to see why. Bitcoin was designed by its pseudonymous inventor, Satoshi Nakamoto, to emulate gold’s store-of-value properties. As a store of value, Bitcoin has several advantages over traditional fiat currencies.

Firstly, Bitcoin is widely accepted and recognised as a store of value by a large percentage of the market. It is also highly liquid, meaning it can be easily bought and sold. Bitcoin is also far scarcer than fiat currencies, as there is a fixed supply of only 21 million bitcoins. In contrast, governments frequently print more fiat currency, diluting the value of the existing stock.

Another advantage of Bitcoin is its divisibility. Each bitcoin is divisible into 100 million satoshis, making it easy to pay for everyday transactions, such as a cup of coffee. Bitcoin is also highly portable. You can take bitcoin with you anywhere in the world, either on a small hardware device or simply by memorising a password.

In addition to its advantages over fiat currencies, Bitcoin also has some benefits compared to gold. While gold is the most durable store of value, having held its value for thousands of years, Bitcoin has proven itself as a successful store of value over its 12+ year history. Bitcoin is also more liquid than gold, with a 24/7, 365-day global market, and it is easier to divide than gold.

Despite its advantages, Bitcoin does face some challenges to its status as a stable store of value. Bitcoin has been criticised for its high volatility, with some arguing that it is not a stable store of value due to its price fluctuations. However, economic theory suggests that the volatility of Bitcoin will decrease as business and consumer usage increases.

In conclusion, Bitcoin has many of the characteristics of a stable, censorship-resistant store of value. It remains to be seen whether Bitcoin can maintain its value over the long term, but its current trajectory suggests that it will continue to gain traction as a global store of value.

It's a hedge against rising inflation

Bitcoin has been described as a hedge against inflation due to its fixed supply of 21 million coins, which safeguards it from the inflationary pressures that traditional currencies face. By nature, Bitcoin cannot undergo dilution through inflation, making it an enticing prospect for investors. The cryptocurrency's decentralised architecture also means it is free from manipulation or control by central banks and governments, adding an extra layer of security for investors.

However, the unique design of Bitcoin does not guarantee its viability as an inflation hedge in all circumstances. The value of Bitcoin is driven by market demand and supply, with no tangible asset backing it up. This means the price can be volatile, and investors may need to liquidate their holdings in times of market stress. For example, between late 2017 and early 2018, Bitcoin's price fell from nearly $20,000 to just over $3,000.

The regulatory landscape surrounding cryptocurrencies is another critical factor in assessing Bitcoin's feasibility as an inflation hedge. Despite gaining wider acceptance, cryptocurrencies are still subject to legal and regulatory uncertainties across different jurisdictions.

When considering Bitcoin as a hedge against inflation, it is advisable to incorporate it as part of a diversified portfolio. By spreading investments across a range of asset types, investors can leverage Bitcoin's potential benefits while mitigating its risks. It is also important to remember that hedging against inflation is a long-term strategy, so patience and discipline are key.

It's a transformational technology

Bitcoin is a transformational technology. It is a peer-to-peer electronic cash system that allows people to exchange value directly with a digital currency, without any middleman. The units of currency that run on the Bitcoin network are called bitcoins.

The Bitcoin network runs on a global, decentralised, self-clearing ledger called the blockchain. Every bitcoin transaction, since the beginning, has been recorded on the blockchain and cannot be erased or altered. The blockchain is a public spreadsheet maintained by its users. It is completely transparent. No one person or entity controls it.

Bitcoin is integrating into our society more and more each day. Its growing power can be harnessed by businesses that use it as their primary currency. Conventional fiat currencies are becoming obsolete as they can’t be the ultimate solution to the modern-world problems. For example, one has to wait for days to receive an international transaction. Fiat currencies also bring more taxes and more worries. With the rise of bitcoin, all of these problems will eventually be alleviated.

Bitcoin is also a great investment opportunity. Its value has been going up for the past couple of months. As of the end of February 2021, the price for 1 Bitcoin exceeds $50,000, which makes this cryptocurrency as valuable as gold. There are over 5 million users on the Bitcoin network, with many joining each day. The more people use bitcoin, the higher its price in the market.

Bitcoin is also far more reliable than other cryptocurrencies. Its network is far more stable, and its infrastructure is better, which adds to the stability of the network. Bitcoin is also one of the safest cryptocurrencies on the market.

Frequently asked questions