Perfect Hedge against Inflation
Fiat currencies are subject to inflation as they have regulation and an infinite supply. On the other hand, this digital money does not suffer inflation because it has a hard limit whereby people can only mine 21 million Bitcoins. Therefore, investors prefer investing in this electronic currency to hedge against inflation. No government or financial institution can regulate or manipulate this digital money. So, this virtual money has a higher return potential than fiat money which loses its value over time. On the other hand, this virtual currency goes through a halving process. This halving process involves the slashing of Bitcoin rewards after every four years and when people mine 210,000 Bitcoins. The halving process is vital as it limits the supply of Bitcoins, increasing demand, which leads to an increase in the value of this electronic money. Because of the halving process, the collection of Bitcoin remains scarce.
Enables Portfolio Diversification
This digital money has a higher return potential because of its limited supply and volatility. The price of Bitcoin fluctuates drastically, but this virtual money has seen a value increase with time. No asset backs this digital money, which is not similar to stocks and bonds. Therefore, this electronic currency is a perfect addition to one’s portfolio. Moreover, before investing in this digital currency, one should thoroughly consult a financial advisor and research.
Ease of Investing
Investing in this virtual currency is not as hard as it sounds. Also, there are zero barriers to entry when investing in this electronic asset. Nevertheless, investing in this electronic currency requires a few rules. For instance, you should allocate a small portion of the entire investment portfolio as a beginner. Moreover, do your research thoroughly and learn the various trading strategies, cons, and pros of investing in this virtual money. Having created an account with a reputable dealer, you can link your account with your bank account and deposit funds. What’s more, you will have to make a Bitcoin wallet that you can access on your smartphone, desktop, or hardware device. There are Bitcoin wallets that people store in the cloud.
Increased Bitcoin Adoption
Many people assumed Bitcoin was a scam when Satoshi Nakamoto introduced it to the public. However, in the past decade, this virtual currency has been around; it has proven to be a great medium of exchange, store of value, and hedge against inflation. Private and public corporations are now investing in this digital money. Well-established businesses and industries are now adopting this virtual currency. For instance, Microsoft was the first company to accept Bitcoin payments. In simpler terms, you should not purchase this virtual money and let it stay in your wallet. One could explore multiple passive income opportunities such as staking, mining, or lending. Also, online stores accept electronic money payments. Hence, one does not have to worry about where to spend their Bitcoins.
Blockchain Is Here to Stay
Satoshi initially introduced this virtual money to provide a better alternative to fiat money. Eventually, this digital money disrupted the traditional financial system, proving that Bitcoin and blockchain are here to stay. Bitcoin is decentralized therefore giving its users the financial freedom they deserve. Eventually, blockchain, a public distributed ledger, is not going anywhere as it promotes transparency.
Final Thoughts
Bitcoin is one of the greatest innovations to be created globally; hence it makes sense when entities and businesses prefer this digital money. This digital money has unique attributes which make it a great coin.
