Cryptocurrencies continue to increase in popularity, with Bitcoin firmly leading the charge. The buzz around Bitcoin has peaked many investors’ interests in the last few years. This article covers why investors should look to Bitcoin in 2022 and beyond.
What is Bitcoin?
Bitcoin was the first cryptocurrency to ever appear on the scene. It was introduced to the public in 2009 by an unknown group called Nakamoto. The hope was to create an entirely digital payment method free of any physical exchange.
It is a fully decentralized cryptocurrency operating outside a person’s or group’s control. Like all cryptocurrencies, the Bitcoin network exists on a blockchain. This blockchain verifies each coin minted. Virtual currency cannot be reproduced.
Why Invest in Bitcoin in 2022?
There are several notable reasons for adding Bitcoin to your list of investments for 2022.
It is Still the Most Popular Cryptocurrency
Bitcoin began with humble beginnings but settled in as the most popular cryptocurrency in the world. While thousands of coins have risen to challenge it, none have come close to what Bitcoin has been able to do. The next most valuable currency, Ethereum, is only worth 5% of Bitcoin’s value.
Thousands of altcoins coins have flooded the cryptocurrency exchanges in the last few years as Bitcoin started heating up. While some coins have potential, none hold a candle to what Bitcoin has accomplished.
As the original cryptocurrency, Bitcoin has the most significant following and is becoming more popular as a payment source. Over 15,000 businesses now accept the currency as legal tender, including big names like Microsoft and AT&T.
High Market Capitalization
Alongside ever-increasing popularity, Bitcoin’s market capitalization is higher than the following nine coins combined. Its massive size shows how well-established the currency is and speaks to some level of stability. Since Bitcoin’s price is so high, it’s unlikely ever to see the coin crumble and fade away to nothing.
It is worth noting that there can only ever be 21 million Bitcoins minted. Although the maximum supply can never exceed this amount, Bitcoin production is slowing and may take another 100 years to get there.
Experts Predict Long-term Price to Go Up
Bitcoin had a tumultuous 2021, seeing two significant rises and two similar-sized drops. It reached an all-time high of $67,500 in November and has struggled to recover.
Even so, many experts believe the coin will climb to over $100,000 soon. While no one is willing to establish a timeline for this feat, most speculate that Bitcoin will achieve these record highs this year. Others are less optimistic about Bitcoin’s chances to reach new heights but still feel the currency is on the path to continued growth.
The coin keeps gaining acceptance as a form of currency, and more individuals look to it as a viable investment option. Should Bitcoin find a place as a gold alternative, there’s no telling what its value could be.
It May Be a Good Time to Buy the Dip
Bitcoin has undoubtedly seen its highs and lows since its inception in 2009. Even while in a dip at present, the currency far surpasses its value when it all started. Historically, Bitcoin has bounced back once from a fall of the magnitude we’re seeing now.
The coin has long passed its days of trading for $1,000 or less. Buying Bitcoin now may be the lowest we’ll ever see the currency again, allowing for the maximum amount of gain given an already expensive investment. We’ve already seen Bitcoin pass the $65,000 mark, and investors are still looking at significant profits if it reaches $100,000 as expected.
Cons of Bitcoin
Bitcoin has enormous upswing potential, but not everything about the currency is positive.
Cost Per Coin
Picking up even a single Bitcoin at its current rate far exceeds even one share of the most expensive stock on the market. Well into the tens of thousands of dollars range, this cryptocurrency comes with a healthy sticker shock.
Fortunately, Bitcoin is very divisible, so getting your hands on a fraction of the currency is possible to start your collection. The smallest denomination currently sits at one hundred millionth of a coin.
Market Volatility
Like most cryptocurrencies, Bitcoin sees a lot of volatility, even from day to day. At the time of writing, the price of Bitcoin dropped by $2,000 on a single day in June. Such variability can scare away investors, especially those looking for short-term gains.
How to Buy Bitcoin
When ready to purchase Bitcoin of your own, you can do so through one of the many cryptocurrency exchanges on the internet. Using a brokerage or buying directly from a Bitcoin owner is also possible.
Most platforms charge fees for the process, and you’ll pay more or less depending on how quickly you want to receive your investment. Generally speaking, the faster you ask the exchange to mine your coins, the more expensive the transaction fees will be.
With the path to starting your collection identified, you’ll need a wallet to store currency. The most common approach is hot wallets that stay connected to the internet. Some investors prefer cold wallets, physical devices you can keep offline.
The Buzz Around Bitcoin: Final Words
Bitcoin is more popular than ever, with thousands of businesses (and a few countries!) treating it as a means of purchase. The currency is very volatile, and buying Bitcoin at the right time is critical for maximizing gains. Investors feel now is the time to pull the trigger before the coin recovers to all new market highs.
Previously published at Wealth of Geeks.
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