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Bitcoin
has certainly revolutionized the way we all look at a currency. The value of
Bitcoin has been constantly increasing at a rapid rate and we all are wondering
where it is going to ever stop.
So if you are eager to know if it is a good
idea to invest your money in Bitcoin, you need to first understand what it
means. There are different possibilities in response to the whole idea of
investing in Bitcoin. You might be interested in buying the crypto currency itself
hoping its value will rise or you could invest in companies related to Bitcoin
as well. In addition to this, Bitcoins also allow you to day trade and make
profits.
Before
you make any final decisions, be noted that it is strongly advisable not to rely
solely upon this information; as we are merely shedding some light on the facts
here. Carry out research on your own and make an informed decision. Never
rush into anything with incomplete information or you might end up regretting
it later. For now, let us take a look at some of Bitcoin’s core fundamentals
listed in the sections below.
Core Fundamentals
First
thing to recall here is the halving protocol observed by Bitcoin, which reduces
the mining volume of the crypto currency once every four years. Bitcoin was
last halved last year in July and the effects caused by the decline in supply were
right before our eyes.
Bitcoin
is considered to be the standard of digital gold these days, which means that
it seems to be a safe haven in times of economic crises. For instance, Brexit
and DT caused Bitcoin to go up by 15% and 4.5% respectively. This gives us a
strong idea about the credibility of the crypto currency in the current
scenario.
With the
advent of Bitcoin, several other crypto currencies, like OneCoin are also
hitting the market. Some of them are going to succeed while others, fail.
Regardless, Bitcoin would be always there to serve you whether other currencies
rise or fall.
China
has been a big player in the current economic scenario of the world for some
time now. As a matter of fact, it is responsible for 80% of the ongoing Bitcoin
mining and 75% of the ongoing trade. Not only that but Bitcoin has also been
serving as a way of shipping money out of the country as a consequence to
currency restrictions imposed by the Chinese government.
Considering
the current trends of the world economy, it is being predicted that crypto
currencies are eventually going to replace the traditional money. So, there is
a good chance that Bitcoin would always be there sustaining its position in the
market.
Other Considerable Factors
Everything
looks pretty great so far, but you might want to consider a few downsides of
this crypto currency as well. For instance, China has been showing some signs
of regulating their economic patterns, so it might limit or even stop the
margin trading carried out on account of Bitcoin. In addition, there has been a
big confusion on what actually is represented by Bitcoin.
Different
jurisdictions seem confused between terming it as a property, a commodity or a
currency. So there are some serious concerns about Bitcoin from a regulatory
perspective. Last but not least, you might have noticed the continuous streak
of technology towards evolution. Consider a scenario where bad actors get in
control of quantum computing. As a consequence, Bitcoin may easily be
destabilized through some sort of hack.
In order to summarize, it may be said that
apparently, everything seems to be going in favor of investing in Bitcoin. But
if you consider the broader picture, there are some notable risks as well. So
if you are planning on investing in Bitcoin, it is recommended to keep your
eyes open and do your research before making any final call.
Follow me on social media: @thefrankmedina
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