Bitcoin is the most well known cryptocurrency. It has reached highs of more than 20,000 USD per Bitcoin, but has fallen dramatically multiple times.
It’s a volatile asset, but you may be asking yourself: Should I invest in Bitcoin?
No-one can say for sure what role cryptocurrencies like Bitcoin will play in the future, but many are adamant that crypto will be part of our lives in some shape or form.
It’s ultimately up to you to decide based on fundamentals whether cryptocurrencies like Bitcoin have the potential to increase in value.
If you believe crypto has a strong future, it might make sense to invest in Bitcoin.
Why would you invest in Bitcoin?
Bitcoin is digital cash that can be sent peer-to-peer without the need to involve a third party like a bank.
With Bitcoin, you can send money across the world in a matter of minutes. The network is maintained in a decentralized manner by miners who work to process transactions in return for small amounts of Bitcoin.
Bitcoin was the first digital cryptocurrency to be created and gain mainstream success. If you invest in Bitcoin, you invest in the idea that Bitcoin will be worth more in the future.
For that to happen, the demand for Bitcoin needs to increase, which means adoption on a mass scale. If the number of retailers and businesses that accept Bitcoin as a payment method increases, then the value of Bitcoin should go up too, as more people will be using Bitcoin as a payment method.
If you invest in Bitcoin you believe in the future of crypto. It’s clear to see that cryptocurrencies, Bitcoin included, have the potential to change everyday life for the better.
However, it’s difficult to say for sure when these technologies will break through to mass adoption – and that’s what matters for your investment.
What about the market crash?
It is fair to wonder whether it’s worth it for you to invest in Bitcoin if the market has crashed. Has everyone lost interest? Is Bitcoin finished?
Again, nothing is certain, but Bitcoin is no stranger to large price decreases, similar to those seen in many financial markets.
Bitcoin has followed a simple market cycle since its fruition. Despite large set backs, the average price of Bitcoin year on year has continued to increase.
These price crashes tend to precede a price rally generally caused by FOMO.
Past market performance is not necessarily indicative of future market movements, but it’s something to keep in mind if you plan to invest in Bitcoin.