Bitcoin (BTC) has been attracting a large number of individuals and traders from all over the world that want to invest in Bitcoin. The fast and impressive price increase experienced by Bitcoin in 2020 was also one of the reasons that people had to invest in Bitcoin. However, large companies are also placing their investments in the crypto market.
In this guide, we will be sharing with you the top 3 reasons to invest in Bitcoin. We know there are many more reasons, but this aims at making it simple and easy for users to understand Bitcoin.
Disclaimer: we are not financial advisors. This post should be considered for educational purposes only. Never invest more than what you are able to lose and always contact your professional financial advisor.
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Now that we have made the necessary disclaimer, we go directly to the top 3 reasons to invest in Bitcoin.
Bitcoin is now proposing a new monetary system. Nowadays, central banks are controlling the supply of funds and how fiat currencies work. However, with Bitcoin, this changes radically. Bitcoin is decentralized and it has a limited supply. This is completely different from what central banks do.
Decentralization means that there is no central authority controlling the Bitcoin network. The Bitcoin network runs thanks to a decentralized model where miners process transactions. At the same time, nodes control the transactions processed are correct. Everyone can become a Bitcoin node. If you also have the necessary money, you can also become a miner.
Bitcoin has also a limited supply of 21 million BTC. There will never be more BTC than this. However, the real supply is even smaller. This is because millions of BTC have been lost. We are talking about the funds of people that lost their wallets or that sent BTC to the wrong address.
In traditional monetary systems, the supply of fiat currency is unlimited. Governments can print as much as they want. This creates inflationary economies where the banknotes lose value on a daily basis. With Bitcoin, despite its volatile price, there will only be 21 million BTC.
Nobody can change that. There are only 6.25 BTC mined per block (every 10 minutes). When Bitcoin will halve again in 2024, the rewards for miners will drop by 50%. That means that each BTC block will reward miners with 3.125 BTC. That’s a total of 450 BTC per day.
Bitcoin has been attracting a large number of companies from all over the world. If you want to invest in Bitcoin, this is something you should know. Companies such as Square or MicroStrategy have purchased more than $500 million in BTC. This shows that BTC is also playing an important role in helping companies improve their portfolio diversification.
If large firms start entering the crypto market, it shows that BTC is already working as a strategic asset. Not only this, but Bitcoin price is moving higher, which means that the entire market is working in a more mature way compared to previous years when Bitcoin was much more volatile than now.
Additionally, there are some countries, such as Iran, that are pushing miners to sell their BTC to the central bank. That means that Iran’s government is also participating in the crypto market. The same can also happen with Venezuela, where virtual currencies have been growing and expanding over the last few years.
Early investors in this cryptocurrency could be the most benefited by its expansion. If the price continues growing, those that acquired the virtual currency at low prices may be able to get financial freedom. This is of course not investment advice.
Analysts suggest that Bitcoin could move higher and reach very high prices. For example, Tim Draper believes that the virtual currency could eventually be traded at around $250,000. This would represent a price increase of 1,566% from current prices ($15,000).
Other analysts believe Bitcoin could move to $100,000 per coin. This is certainly something that could happen in the future and that could help users improve their financial situation. Let’s remember, nobody is controlling Bitcoin’s supply. Furthermore, there is no centralized authority that would be able to add more BTC to the 21 million cap. Bitcoin is certainly helping the entire world, including individuals and companies.
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