Is Bitcoin Still A Good Investment?
Is Bitcoin still a good Investment for 2022? With the cryptocurrency crash of 2018 nearly halving Bitcoin's value, as well as the very recent July 2021 crash, many people wonder if Bitcoin is still a good investment.
Despite the inherent risk and volatility of cryptocurrency, as well as the controversies attached to this digital coin and cryptocurrency in general, investors shouldn't be too quick to write off Bitcoin.
Here are reasons why you should be investing in Bitcoin in 2022.
Disclaimer: We want to emphasize that this is not financial advice. Cryptocurrencies operate in a volatile market, where values can drastically fluctuate in a blink of an eye. It is imperative to conduct thorough research and seek guidance from a qualified financial advisor before investing.
1) Global accessibility
The transformative power of Bitcoin and cryptocurrencies is evidenced by the enhanced financial access they offer to unbanked and underbanked populations globally. Traditional financial institutions often impose exorbitant fees and cumbersome processes that can be prohibitive, particularly for those in underserved regions. Bitcoin and cryptocurrencies, however, break down these barriers and present a new frontier of financial inclusion.
Platforms like Independent Reserve and other cryptocurrency exchanges have democratized access to these digital assets. With relatively low barriers to entry, individuals can easily purchase Bitcoin and other cryptocurrencies, granting them the ability to engage in global trade and transactions without the delays and restrictions characteristic of traditional financial systems.
A noteworthy development that underscores Bitcoin's influence is its recognition as legal tender in El Salvador. This historic move bolsters Bitcoin's credibility and showcases its potential as a viable medium of exchange, not confined to the realm of speculative investment. As El Salvador embraces Bitcoin, it sets a precedent that could pave the way for broader adoption and integration of cryptocurrencies into traditional financial systems around the world.
The combination of reduced fees, decentralized nature, and its global reach positions Bitcoin as a promising tool for financial empowerment, inclusivity, and potential economic transformation, particularly in regions where conventional financial infrastructure falls short. This shift indeed bodes well for Bitcoin's continued growth and its potential to catalyze positive change on a global scale.
2) Bitcoin's price volatility has brought many people to the market
The resounding fluctuations in the value of Bitcoin have undeniably stirred a commotion across diverse platforms, ranging from news outlets to social media networks. Amidst this fervor, a notable consequence has emerged: the influx of fresh cryptocurrencies and individuals into the landscape. Interestingly, this dynamic surge is indeed a favorable development for proponents of Bitcoin.
While the rollercoaster nature of Bitcoin's value may unsettle both newcomers and seasoned traders, it is this very volatility, coupled with its staggering price surges, that continually attracts a steady stream of newcomers to the digital currency arena.
This sustained influx of interest bolsters the outlook for Bitcoin advocates. As the number of inquisitive eyes remains locked on this digital currency, its position is fortified. The trajectory of its growth is fortified by this ongoing influx of attention, making the endeavor to supplant or challenge Bitcoin's standing all the more formidable.
While the unpredictable price shifts may unsettle some, the ongoing curiosity generated by its fluctuations ensures that Bitcoin remains a prominent and discussed presence. This visibility, coupled with its persistent allure, solidifies its stance in the evolving landscape of digital assets.
3) Bitcoin's limited supply makes it all the more savory
Indeed, one of Bitcoin's most remarkable and immutable attributes lies in its limited supply. The protocol firmly stipulates that the total number of Bitcoin coins can never exceed 21 million. This fixed supply is an integral aspect of Bitcoin's design, ingrained through its codebase with unyielding precision. Consequently, any endeavor to augment the Bitcoin supply is futile, as the rounding operators within its code establish an insurmountable cap.
This intriguing characteristic generates a fascinating dynamic. As demand and popularity for Bitcoin surge, the finite supply engenders a proportional appreciation in its price. The scarcity inherent to the capped supply aligns with economic principles, contributing to the asset's appeal as a potential store of value.
Currently, approximately 18 million Bitcoins are in circulation, leaving around 3 million yet to be mined. This gradual issuance is governed by the "halving" algorithm, which reduces the number of new Bitcoins minted periodically. This algorithmic mechanism tempers the rate of new supply, emphasizing scarcity and potentially influencing price dynamics.
This scarcity-driven model follows a trajectory leading to a temporal eventuality. By the year 2140, all 21 million Bitcoins are projected to have been mined into existence. This milestone underscores Bitcoin's uniqueness and underscores its role as an unprecedented digital asset.
In essence, Bitcoin's fixed supply fosters a fascinating interplay between demand, scarcity, and price dynamics, rendering it an emblematic and intriguing entity within the ever-evolving financial landscape.
4) The market is regaining its footing
Despite the notable downturn experienced in the July 2021 crash, it's noteworthy that Bitcoin's price has undergone a decline of approximately 45% from its pinnacle reached in May 2021. While this retreat may have introduced pronounced undulations into the investor journey, it is intriguing to witness the steadfast bullish sentiment that persists within the market.
Remarkably, as of March 2022, Bitcoin's price has demonstrated a remarkable resilience, hovering close to its all-time high (ATH) figure. This proximity to its historical peak augments the optimism surrounding the potential for Bitcoin's meteoric ascent to continue its trajectory into the future.
This prevailing scenario underscores a critical insight: ample opportunities for market growth and price appreciation continue to exist. With the market yet to fully attain its zenith, the terrain remains conducive for fostering accelerated financial growth. The ongoing potential for price surge and market expansion is suggestive of a horizon ripe with possibilities, presenting investors with the potential to leverage their assets to attain even swifter growth while the market's peak remains an objective yet to be entirely realized.
In sum, the resilience showcased by Bitcoin's trajectory, even in the face of challenging market events, epitomizes the enduring enthusiasm within the market. As we traverse 2021 and beyond, the terrain appears poised to extend room for growth, propelling the prospects of substantial price appreciation and promising returns for those poised to seize the opportunity.
5) Immediate transactions become possible
The peer-to-peer (P2P) nature of cryptocurrency transactions facilitated by blockchain technology brings forth a remarkable advantage: immediacy. Unlike the traditional financial landscape, where intermediaries and third parties necessitate hours or even days to process transactions such as loans or credit card payments, cryptocurrency transactions occur swiftly through the seamless collaboration of P2P nodes on the blockchain network.
This distinction is particularly evident when considering the promptness with which Bitcoin and other cryptocurrencies can be transacted. In contrast to the labyrinthine processes and delays encountered in traditional banking systems, cryptocurrency transactions can transpire instantaneously, provided there's Internet connectivity.
The accessibility of Internet access fuels the practicality of conducting transactions using cryptocurrencies. When seeking to make an online purchase using your Bitcoin wallet, the process becomes feasible, granted the seller acknowledges and accepts this form of digital currency as payment.
The outcome is twofold: not only do cryptocurrency transactions evade the fees that may be associated with traditional bank accounts and credit cards, but they also circumvent the logistical expenses linked to physical transportation, further streamlining the entire process.
This characteristic exemplifies the power of blockchain technology and cryptocurrencies in revolutionizing the transactional landscape, aligning with the demands of the modern era for efficiency, immediacy, and financial inclusion.
6) Bitcoin is still the world's most well-known cryptocurrency
Bitcoin's pioneering emergence has bestowed upon it a certain regal stature within the realm of cryptocurrencies, a position that is likely to endure for the foreseeable future.
Casting our gaze back to the early 2010s, Bitcoin's presence was a whisper within niche discussion boards, largely overlooked by the mainstream. Yet, within just a few short years, this unassuming cryptocurrency witnessed an astonishing metamorphosis. In December 2014, Bitcoin's value was scarcely approaching $300 per coin. Fast forward to March 2022, and the very same coin commands an astonishing price of $62,000—an exponential rise that continues to unfold.
Indeed, in the contemporary landscape, Bitcoin stands tall as the premier exemplar of valuable digital assets. Its remarkable trajectory has positioned one unit of BTC as the most valuable form of digital money worldwide. This achievement becomes even more remarkable when one considers the backdrop of formidable competition and the advent of groundbreaking blockchain technologies, from the likes of Ethereum and Cardano to Algorand.
The annals of history offer an instructive lesson: the first to tread new markets often reap substantial advantages. This axiom aligns seamlessly with Bitcoin's narrative, as it was the trailblazer, the inaugural entrant that paved the way for the burgeoning cryptocurrency arena. This early-mover advantage—imbued with the allure of legacy and the trust that accompanied its inception—continues to fortify Bitcoin's preeminent stature.
In an arena marked by constant innovation and competition, Bitcoin has, against the odds, maintained its regency. As the quintessential digital coin, it rests serenely on its throne—a testament to the enduring power of pioneering and the indelible imprint of history upon emerging markets.
7) Bitcoin diversifies your portfolio
In a landscape characterized by the oscillations of fiat currencies and the fluctuations of stocks, Bitcoin emerges as a compelling avenue to diversify one's investment portfolio.
Amidst the volatility and inflation experienced by numerous global fiat currencies and stock markets, Bitcoin offers an attractive opportunity to broaden the scope of your investments. Particularly for those who hold a firm belief in the potential of the cryptocurrency market, integrating Bitcoin into your investment strategy can serve as a strategic maneuver alongside your stock portfolio.
At the heart of this diversification strategy lies the decentralized nature of Bitcoin. It stands as an entity untethered to the control of governments, corporations, or individuals, thereby insulating it from potential restrictions or manipulations that might impact traditional assets.
Notably, the allure of Bitcoin extends beyond its decentralization. Opting for Bitcoin as an investment vehicle safeguards against the amplified volatility that often engulfs other cryptocurrencies in the market. Renowned as one of the premier cryptocurrencies globally, Bitcoin's established reputation as a stable digital asset is well-earned.
The historical trajectory of Bitcoin's value showcases its potential for substantial gains over time, rendering it a compelling vessel for wealth preservation. Beyond this, it can assume the role of an effective hedge, safeguarding against the tumultuous ripples of significant stock market crashes that have reverberated through regions like China or Greece.
In essence, the incorporation of Bitcoin into an investment portfolio extends beyond diversification—it reflects a strategic alignment with a decentralized, stable, and resilient asset. As the interplay between traditional and digital finance continues to evolve, Bitcoin stands as a steadfast beacon, offering investors a formidable means to navigate and thrive amidst a dynamic financial landscape.
Where to buy Bitcoin?
You can buy Bitcoin from cryptocurrency exchanges. These online platforms allow investors to trade between fiat currency (like USD or AUD) and Bitcoin and other forms of cryptocurrencies.
