With the recent surge in interest around cryptocurrencies, many are eager to learn how to invest in bitcoin. In fact, even before this drastic uptick in attention, bitcoin experienced a steady rise in value since its creation, making it enticing to investors. While many take bitcoin’s history of success as an indication to invest, others still worry over bitcoin’s possible volatility. Find out if you personally should invest in bitcoin by considering the facts below.
Invest in Bitcoin: Is Now the Right Time?
1. Steady Increase in Market Value
Experts believe bitcoin’s worth will continue to rise in the coming years, which means all the more reason for investors to start investing in it today. Since its creation in 2009, bitcoin’s market cap has risen from zero to, at the time of writing this, a now whopping $100 billion. This means it has surpassed even the worth of Goldman Sachs Group, Inc. or eBay Inc. Additionally, as far as the supply is concerned, there is the assurance that there is more to come. Outside of these factors, users value bitcoin for its ability to conveniently and efficiently transfer money. It’s also cheaper and has lower fees compared to other investment strategies that require a middleman.
2. Popularity Gained, More Users Gained
Bitcoin, experts claim, is still the top digital currency. While other new competitor cryptocurrencies have recently been created, bitcoin is still considered the best. This point is backed up by data that shows via transactions that the volume of users of bitcoin is evenly increasing — regardless of its price.
3. More Investors Are Using Bitcoin
Investors who have begun to invest in bitcoin look at it as a way to diversify their portfolios. Around 2015, the New York Stock Exchange released a bitcoin index, the Bitcoin Investment Trust (GBTC). This means that major players, including both people and institutions, are now prepared to use bitcoin as an established form of investment.
4. The Higher Bitcoin’s Usage, The Higher Its Market Value
Bitcoin follows the basic principle of supply and demand. Since the current demand is high, prices are too. Compared to its competitors, bitcoin also has the most liquidity and a high level of security when it comes to trading.
5. Government-Approved Regulations on Bitcoin
The regulations surrounding bitcoin have been difficult to negotiate. In 2014, the IRS released guidance that treated virtual currencies as personal property subject to taxes. However, bitcoin cannot be regulated according to the Fed. Even with examples like New York, which issued a BitLicense in 2014, corporations like Xapo, BitPay, Coinbase and others who use bitcoin have the flexibility to move their business elsewhere, along with huge funds to back them up when confronted with legal challenges.
6. Flexible As an Investment
Bitcoin’s flexibility lies in its many uses. In fact, it’s comparable to gold in terms of investment flexibility. For example, bitcoin is attractive for both its money transfer capabilities, as well as its use of the block chain as a public ledger when spent.
7. Huge Impact in the Tech Sector
While a different medium, in terms of changing the technological landscape, bitcoin is proving just as impactful as Facebook or Apple. Because of bitcoin, many developed institutions and financial markets are embracing new trading technology that will change markets for years to come.
The growth potential for bitcoin is still enormous. However, for those considering bitcoin, experts recommend spending some time studying this unregulated market. After all, any business venture or investment offers challenges.
Has this motivated you to invest in bitcoin? Let us know in the comments below.