Should you buy Bitcoin? 10 Reasons to Invest in Bitcoin in 2023
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More and more investors want to invest in Bitcoin, the world's largest cryptocurrency. Must read for investors looking for guidance for the first time.
In this guide we answer the question: Should I buy Bitcoin?
We explore 10 reasons why Bitcoin is here - plus some tips on how to get into the business safely and cost-effectively.
Will I buy Bitcoin in 2023? Highlights
Bitcoin is one of the most successful assets of recent years. Bitcoin was nearly worthless when it was launched in 2009. Fast forward to today, Bitcoin is trading around $30,000. This represents growth of billions of percent, more than traditional assets like stocks and real estate. Although CoinMarketCap data shows that Bitcoin's value has surpassed $550 billion, many analysts believe that the digital asset still has a lot of room to grow.Technology blockchain contributes to Bitcoin's investment theory. For example, Bitcoin is suitable as a medium of exchange. Cross-border transactions take only 10 minutes and rarely cost more than a few dollars. Bitcoin is also transparent and transactions go to the blockchain ledger.
There is still debate about using Bitcoin as a store of value. There is a limited token offering of only 21 million. There are currently 19.4 million tokens in circulation. There is no inflation in Bitcoin. Only 6.25 new Bitcoins enter the market every 10 minutes. This completes the prediction of Bitcoin features. Bitcoin is also decentralized. It is not controlled by any organization and is not supported by any central bank or government. Moreover, the transaction does not need to be done through a third party.
This makes Bitcoin inclusive and censorship-free. But what really attracts investors is Bitcoin's price potential. During its most recent cycle, Bitcoin rose from $4,800 to over $68,000. This represents growth of over 1,300%. Bitcoin's bear market price is currently around $30,000. This allows investors to enter the market at a price 55% lower than the previous peak. However, Bitcoin is a risky investment. That's why investors ask "Should I invest in Bitcoin?" They need to do a lot of research to find the answer to the question.
10 Reasons to Buy Bitcoin Now: Our Review
Still unsure if Bitcoin is a worthwhile investment? How many people use Bitcoin today? In the next section, we will discuss 10 reasons why Bitcoin is still one of the most popular assets in 2023.1. Price History - Bitcoin has experienced significant growth
Bitcoin has attracted the attention of many investors, especially those with life-changing goals. The numbers are clear; Few assets have surpassed Bitcoin since its inception in 2009. According to Investing.com, Bitcoin was trading at just $0.10 in 2010; this was the earliest recorded price. Just three years later, Bitcoin reached $250, representing growth of over 250,000% for early investors.
It takes hundreds of years for the market to reproduce similar products. At the beginning of 2017, Bitcoin was trading at $1,000. By the end of the same year, Bitcoin rose to $20,000. In just 12 months of trading, this equates to growth of 1,900%. Bitcoin has since risen to an all-time high of over $68,000. Therefore, those who invested at the beginning of 2017 have now increased by over 6,700%.
The point is that Bitcoin's growth is very important. Especially the returns obtained by long-term investors cannot be compared with the stock market. For example, the Dow Jones Industrial Average, which tracks 30 blue-chip stocks, is up 38% over the past five years. The Russell 2000 index, which tracks 2,000 small-cap stocks, is up 17% over the same period. Although gold has performed better over the last five years, it still returned only 58%. By comparison, Bitcoin's five-year growth is 317%.
However, while Bitcoin's long-term trajectory is good, it has gone through several down cycles. Volatility levels are higher than traditional assets, so investors need to keep this in mind. However, risk can be reduced by investing in other assets and creating a balanced portfolio.
What would $100 worth of Bitcoin be worth if I invested 10 years ago?
Bitcoin was trading around $100 per coin in July 2013So, a $100 investment will yield 1 BTC token
10 years later the same 1 BTC will be worth approximately $30,000
This , representing an increase of approximately 30,000%
During the same period, the S&P 500 rose 170%
2. Bitcoin is a decentralized asset
Decentralization is an important part of the Bitcoin ecosystem. Essentially, this means that Bitcoin has not had a single failure. In contrast, no person, place or organization can control the Bitcoin network. This is unlike most financial assets. For example, traditional currencies such as the US dollar and euro are controlled by central banks. Central banks will make economic decisions such as interest rates and food levels. > This means depositors could lose their income if the company goes bankrupt. Bitcoin is not backed by any government or central bank. This means investors can manage their money by holding Bitcoin. This is especially true when Bitcoins are held in non-custodial wallets. The only way to access your wallet is by using a password or private key. In other words, Bitcoin cannot be seized or frozen by a third party.
Decentralization is also important when sending and receiving Bitcoin. Since there is no intermediary, changes do not require approval from others. Instead, transactions are verified by “miners.” In short, Bitcoin miners keep the network secure and decentralized. Every 10 minutes, a new block of Bitcoin transactions needs to be verified. Miners will try to verify blocks by solving numerical equations. Miners who complete the block will be rewarded with 6.25 BTC. They also cover the processing fee paid by the sender.
3. Bitcoin supply is fixed and limited
How many Bitcoins are there? This question is asked by most cryptocurrency investors throughout the year.
One of the biggest problems facing old currencies is inflation. This increases the cost of living mainly through central bank policies. For example, the creation of new money by the central bank is called quantitative easing. In simpler terms, central banks "print" new money and thus increase the supply. This causes currencies to depreciate, meaning people save less purchasing power. Over time, as inflation increases, the value of traditional money decreases.
Bitcoin solves this problem in many ways. First of all, Bitcoin's properties are determined by its programming code. Since there is no regulatory system, Bitcoin supply cannot be controlled by governments and central banks. Instead, new Bitcoins enter every 10 minutes. As we mentioned above, after the block is implemented, miners are rewarded with 6.25 BTC. This means an extra 900 BTC every day or 6,300 BTC per week. This ensures that Bitcoin supply is predictable and prevents hyperinflation.
In conclusion, it is the feature of Bitcoin limits. This is no longer a problem when the supply reaches 21 million, with new Bitcoins entering every 10 minutes. This is expected to happen in 2140. Bitcoin's limited supply helps the digital asset gain value over time. The basis for this is the demand for Bitcoin. If it exists and supply is limited, Bitcoin's price will increase organically.
We should also mention that the reward only halves every 210,000 blocks (e.g. approximately every four years). The initial mining reward was 50 BTC, then it was reduced to 25 BTC, 12.5 BTC, and now 6.25 BTC. In 2024, the mining reward will be halved to 3,125 BTC. This means that the supply of new Bitcoin tokens decreases every four years. This allows Bitcoin to expire in less time. This is similar to other products. As a result, the amount of gold and gas that can be extracted is limited.
When the question is asked - Should I buy Bitcoin? - The trader must control the information he uses as a medium of exchange. Currently, the most widely used international medium of exchange is fiat currency such as the US dollar, British pound sterling or euro. In other words, the medium of exchange enables people to buy and sell goods and services. But unlike fiat currency, Bitcoin transactions do not go through a third party.
This allows people to send and receive Bitcoin across borders without any regulations. For example, let's say an American worker sends money to a family in Africa. Employees must use a bank account or remittance agent such as Western Union. Both options have high costs and slow turnaround times. Not to mention the numerous and costly KYC procedures.
According to the World Bank, the current average rate of return is 6.25% of the transaction value. So for every $1,000 transferred to friends and family, $62.50 goes to third parties. Now compare this to Bitcoin. Bitcoin transactions have a fixed price regardless of transfer speed; this is determined by network conditions. Currently the Bitcoin exchange rate is between $0.70 and $3. Therefore, the exchange rate for the same 1000 dollars will vary between 0.07% and 0.3%.
Of course, as the exchange rate increases, the interest rate will decrease. However, cross-border transactions with Bitcoin are cheaper than traditional methods. Bitcoin is also faster in many situations, especially when sending money to new countries. For example, sending money from Argentina to Indonesia via bank transfer can take several days. This is because the transfer requires a correspondent bank between the sender and the receiver.
On the other hand, Bitcoin's average transaction time is only 10 minutes. This is a problem regardless of:
Where the sender is
Where the receiver is
Time or date
Shipping cost
Bitcoin Ideal Another reason is the lack of a control problem. in the midst of change. As we mentioned above, international trade often requires many regulations. Money transfer agents may ask for proof of identity and personal details. Changes are approved only when the representative is satisfied that the changes are legal and compliant.
The Bitcoin business does not need such a perspective. Once the sender confirms the transaction, it is sent to the blockchain. The recipient should see the Bitcoins in their private wallet within 10 minutes.
3. Bitcoin supply is fixed and limited
How many Bitcoins are there? This question is asked by most cryptocurrency investors throughout the year.
One of the biggest problems facing old currencies is inflation. This increases the cost of living mainly through central bank policies. For example, the creation of new money by the central bank is called quantitative easing. In simpler terms, central banks "print" new money and thus increase the supply. This causes currencies to depreciate, meaning people save less purchasing power. Over time, as inflation increases, the value of traditional money decreases.
Bitcoin solves this problem in many ways. First of all, Bitcoin's properties are determined by its programming code. Since there is no regulatory system, Bitcoin supply cannot be controlled by governments and central banks. Instead, new Bitcoins enter every 10 minutes. As we mentioned above, after the block is implemented, miners are rewarded with 6.25 BTC. This means an extra 900 BTC every day or 6,300 BTC per week. This ensures that Bitcoin supply is predictable and prevents hyperinflation.
In conclusion, it is the feature of Bitcoin limits. This is no longer a problem when the supply reaches 21 million, with new Bitcoins entering every 10 minutes. This is expected to happen in 2140. Bitcoin's limited supply helps the digital asset gain value over time. The basis for this is the demand for Bitcoin. If it exists and supply is limited, Bitcoin's price will increase organically.
We should also mention that the reward only halves every 210,000 blocks (e.g. approximately every four years). The initial mining reward was 50 BTC, then it was reduced to 25 BTC, 12.5 BTC, and now 6.25 BTC. In 2024, the mining reward will be halved to 3,125 BTC. This means that the supply of new Bitcoin tokens decreases every four years. This allows Bitcoin to expire in less time. This is similar to other products. As a result, the amount of gold and gas that can be extracted is limited.
4. Bitcoin can be used as a medium of exchange
When the question is asked - Should I buy Bitcoin? - The trader must control the information he uses as a medium of exchange. Currently, the most widely used international medium of exchange is fiat currency such as the US dollar, British pound sterling or euro. In other words, the medium of exchange enables people to buy and sell goods and services. But unlike fiat currency, Bitcoin transactions do not go through a third party.This allows people to send and receive Bitcoin across borders without any regulations. For example, let's say an American worker sends money to a family in Africa. Employees must use a bank account or remittance agent such as Western Union. Both options have high costs and slow turnaround times. Not to mention the numerous and costly KYC procedures.
According to the World Bank, the current average rate of return is 6.25% of the transaction value. So for every $1,000 transferred to friends and family, $62.50 goes to third parties. Now compare this to Bitcoin. Bitcoin transactions have a fixed price regardless of transfer speed; this is determined by network conditions. Currently the Bitcoin exchange rate is between $0.70 and $3. Therefore, the exchange rate for the same 1000 dollars will vary between 0.07% and 0.3%.
Of course, as the exchange rate increases, the interest rate will decrease. However, cross-border transactions with Bitcoin are cheaper than traditional methods. Bitcoin is also faster in many situations, especially when sending money to new countries. For example, sending money from Argentina to Indonesia via bank transfer can take several days. This is because the transfer requires a correspondent bank between the sender and the receiver.
On the other hand, Bitcoin's average transaction time is only 10 minutes. This is a problem regardless of:
Where the sender is
Where the receiver is
Time or date
Shipping cost
Bitcoin Ideal Another reason is the lack of a control problem. in the midst of change. As we mentioned above, international trade often requires many regulations. Money transfer agents may ask for proof of identity and personal details. Changes are approved only when the representative is satisfied that the changes are legal and compliant.
The Bitcoin business does not need such a perspective. Once the sender confirms the transaction, it is sent to the blockchain. The recipient should see the Bitcoins in their private wallet within 10 minutes.
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