The Main Bitcoin Advantages
In 2023 Bitcoin represents one of the greatest investments not just by individuals but also by institutional investors. The value of Bitcoin climbed to over $60,000 in 2021, and the market capitalization has surpassed $500 billion.
Although Bitcoin since then has entered a bear market phase, which followed certain fluctuations in its value, Bitcoin is still considered a pretty solid investment crypto-wise, and it's one of the major cryptocurrencies on the crypto market. Needless to say, the advantages of investing in Bitcoin are widely known today; however, for new investors, it might be confusing why this digital currency is taking over the financial market. Let's take a look at the main benefits of Bitcoin as a cryptocurrency today.
Blockchain Technology
Blockchain technology is created in a way to support the processing of BTC transactions without any intermediary. It is created as a peer-to-peer-based database where the blocks of transactions are added to the digital ledger, and following this, they are recorded on the network. Because this is a peer-to-peer database, every transaction is approved by the crypto miners ( the process is also known as proof-of-work), and this enhances the security of the platform and also mitigates the problem or allows a central authority to monitor the blockchain network.
The blockchain network utilizes cryptography to link each block of the transaction to the ledger, which means that it provides high levels of safety. Also, because each node of the network has the same level of responsibility and authority when it comes to the verification of new blocks of transactions, the transaction fees are low even for international BTC payments.
Moreover, the design of the blockchain network makes it fully transparent, which means that every online user has complete access to the same information. They can see in real-time the incoming number of transactions and the number of added blocks on the platform and also spot any potential errors.
So, it puts everyone at the same level regardless of the role on the platform as miners or as investors. You can learn more about blockchain technology here.
Support of the Business Sector
Actually, this is the main reason why many businesses accept BTC would be on its money-making potential. For example, there are many brands that accept crypto payments and Bitcoin, such as people OkCupid, PayPal, AT&T, Square, and many others.
On top of that, Bitcoin is also available, as well as other crypto payments on online casinos. Online casinos are always looking for ways to improve their casino experience, which is why many accept BTC payments as well as crypto payments. So, you can actually wager with your BTC (and other cryptocurrencies) on your favorite casino games on a reputable crypto casino like bigwins.com.
Anonymity
This aspect of Bitcoin might be lost when Bitcoin becomes mainstream currency, but its initial creation was to offer total anonymity to the users of the network. So, whenever anyone made a transaction on the blockchain network, no one could trace back the sender or the receiver of the transaction.
Still, complete transparency when it comes to the data about the processes and the transactions of the network remains a vital part of blockchain technology because it ensures maximum safety and it hides the real identity of the users.
Accessible Bitcoin Tokens on Trading Sites
Bitcoin remains a popular cryptocurrency because it is globally available on online trading sites. There are many new and older trading platforms where users can invest in BTC with just a couple of clicks from their computers and smartphones.
The main advantage of the development of the Bitcoin trading platforms was the opportunity to invest in not just BTC but other cryptocurrencies and, obviously, the accessibility of the online trading sites.
As they are mobile-friendly and easily available on any mobile device and, of course, your computer as well. All you need to do to start trading is to create an account with a crypto wallet on a reliable trading site. Plus, actually many trading sites are integrated with crypto wallets to further make it easier for investors to start trading.
Bitcoin's Bull Runs
The benefit of investing in Bitcoin is the bull runs which can last up to a year and are expected to happen after a halving event which further reduces the number of Bitcoin coins on the market. The bull runs are exceptional because this is the largest cryptocurrency on the market, and they also have a positive impact on other cryptocurrencies, which is, again, a great outcome if you have different virtual currencies in your portfolio.
Moreover, Bitcoin bull runs have resulted in a greater market capitalization and a price of Bitcoin of over $60,000 back in 2021. It is expected in the future for Bitcoin to have an even better position in the crypto market because, as we said, it is a rare currency.
Bitcoin Halving
Bitcoin halving represents a programmed event in the Bitcoin ecosystem, and it was created by Satoshi Nakamoto in order to keep the inflation rate of Bitcoin under control. It was a the necessary mechanism as Bitcoin is a decentralized cryptocurrency, and as we mentioned earlier, Bitcoin halving is followed by a bull cycle in the market.
It's also one of the major reasons why the relationship between the market supply and market demand is shifted. So, more specifically, when we talk about Bitcoin halving or even halving, as some crypto supporters call it. It is an event that is scheduled to happen after 201,000 blocks are included in the blockchain network. So, after the 201,000 blocks are added, then automatically, the BTC reward is cut in half.
Otherwise, it's worth noting that every Bitcoin miner works on the blockchain network in order to potentially receive transaction fees and the main BTC reward. This is why they even work in mining pools and combine their computing power in order to achieve better and faster results.
So, needless to say, the main motivation for their work on the platform is the block reward. However, as the block reward gets diminished approximately every four years, the transaction fees will probably replace the BTC reward as a main motivation for working on the blockchain network in the future.
Early on, the BTC reward was set at around 50 BTC, but as time went on, it kept decreasing, and with the last halving, it declined to 6.25 BTC. Below, you can take a look at the BTC reward and how it got halved every four years or so.
- 50 BTC in 2009 – the starting point of the block reward
- 25 BTC in 2012
- 12.5 BTC in 2016
- 6.25 BTC in 2020
- 3.125 BTC in 2024 – the next expected halving
The next halving is expected to happen around March 2024 and based on the previous historical data, it is predicted that Bitcoin will enter its next bull market phase. So, basically, bitcoin halving is not only important for keeping under control the inflation, but it is also important for Bitcoin's value. Namely, it decreases the supply, and thus it enhances the scarcity levels for BTC, and automatically, the market demand is at a higher level than the supply.
This would be more noticeable later on as the BTC supply will continue to follow a downward trend. A major factor in why the event had this level of impact was the restricted supply of BTC. Actually, as a cryptocurrency, Bitcoin was designed to have a limited supply of around 21 million tokens, and this is one of the reasons why Bitcoin halving is an event that is so anticipated in the crypto community, and it has the effect that it does. For more information on bitcoin halving, check out this video.
Final Thoughts
To sum up, there are plenty of advantages to investing in BTC. The primary goal of Bitcoin was to provide a distributed payment system that isn't controlled by any fluctuations in the financial markets or fiscal and monetary policies. Thanks to the solid design of the blockchain network, not only was this accomplished, but also the foundations were built for the future crypto market.
Moreover, Bitcoin as a cryptocurrency is highly valuable due to its restricted supply, minimal transaction costs, highly safe blockchain network, and granted anonymity of the users. Moreover, BTC is also one of the main reasons why there was a mainstream adoption of crypto not just by businesses but the public sector as well on a global scale.
There's an increasing number of governments that are interested in regulating crypto, creating more opportunities that would allow crypto users to invest in BTC or to use BTC to purchase products and services.
Also, the integration of BTC into the mainstream meant that you could actually use Bitcoin for purchases not just on online platforms but also in brick-and-mortar stores as well. That shows that in the future, crypto will become part of our day-to-day lives. So, if you're looking to add BTC to your portfolio, you can usually make an investment on online trading sites from your mobile device or computer.
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