Are Bitcoins a great option for investment?

by | Aug 6, 2022 | Crypto | 0 comments

Cryptocurrency has become the talk of a decade after the Internet since 2008. The idea of a digital currency sounded like a far-fetched reality, and now with various cryptocurrencies, the cryptocurrency exchange has also become a hot topic. However, it’s been gaining traction since 2008.

There are currently debates about cryptocurrency and how it can become a threat to the Fiat economy and dominate global reserves. Current projections indicate that there is a possibility of cryptocurrency being as valuable as gold. Bitcoin is the first cryptocurrency and has sparked interest among investors.

The thrill of being super-rich or failing has left investors with a dilemma of whether or not to invest in Bitcoins. However, there is one certain thing. The riskiness factor of investing in Bitcoins has been reduced since 2012, which is much safer in 2022.


Cryptocurrency Landscape

Going back to the pre-digital ages, the Internet seemed like a far-fetched reality. Investors were speculated about investing in it; however, the tables have turned since 1998.

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Similar speculations are being made about Bitcoin. However, to put things into perspective between Bitcoin and Internet adoption, Bitcoin has increasing adoption numbers compared to the Internet in its early stages. Investing in Bitcoin ultimately comes down to your personal choice and wishes to diversify your portfolio.

Market potential and Bitcoin Statistics

As of March 2022, over 75 million people have created Bitcoin wallets showing interest in owning digital assets. This is a 72% jump from the previous year. It has been estimated that around 43% of Americans hold a share of BTC and have surpassed more than 200K transactions each day.

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Financial analysts have estimated that by the year 2025, the global blockchain market is expected to grow to 39.7 billion dollars. Currently, there are around 81 million Bitcoin owners worldwide. However, the legality of Bitcoins is challenged by various countries.

Legality of Bitcoin

The legality of Bitcoin is still a topic of debate among various countries. El Salvador is among the first countries to legalize Bitcoin, followed by Paraguay. The European Union doesn’t recognize Bitcoin as illegal; however, it states that crypto-asset activities are out of its control.

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Apart from this, the United States Department of Treasury issues guidelines on the usage of Bitcoin, and it is not illegal in the US. Other countries have yet to adopt Bitcoin; however, they fear it might impact their local currency.

On the other hand, countries like Russia are considering the adoption of Bitcoin as it can reduce their dependence on the US dollar. From an investment perspective, Bitcoin needs to be monitored for fluctuations; however, this will reduce in the near future depending on government and financial institutions’ decisions.

Risks associated with Bitcoins

The volatility of Bitcoin is one of the major concerns among investors. For instance, the value of BTC in December 2017 was 20K USD which weeks later came down to 7K USD. Such major fluctuations within a couple of weeks put it at risk for short-term investment.

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Although you would be doing well in 2021, holding for years is not a viable option. Apart from this, Bitcoin also holds a threat of being hacked on a personal scale. Bitcoins blockchain technology has never been hacked; however, hackers can target holders based on private keys and sensitive information. You can mitigate this by using secure crypto-wallets.

Investor psychology.

Bitcoin is a volatile cryptocurrency, and experts claim that investing in Bitcoin depends on your personal choice. If you aren’t into big fluctuations that fluctuate with your blood pressure, it is simply a bad option.

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However, for those who wish to explore a new financial venture, Bitcoin is a great choice. Therefore, financial experts say that you can allocate 5% of your portfolio to BTC. It is also important to note that you can invest in BTC infractions.

Top Bitcoin owners globally

Changpeng Zhao, the founder of major cryptocurrency exchange company Binance, holds the highest holdings of BTC. According to Forbes, his current net worth is 1.6 billion dollars.

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Next in line are Sam Bankman-Fried, Tyler and Cameron Winklevoss, Brian Armstrong, and Michael Saylor. Of course, not forgetting the founder, Satoshi Nakamoto, holds the highest number of Bitcoins.

The Verdict

Well, it is evident that the scope of Bitcoin is bright. It has evolved immensely from its inception, and its rapid growth is one of the major factors that prove its acceptance. As an investor, it is also important to check out cryptocurrency exchange platforms like coin base. Ultimately, it comes down to your personal choice.

Is investing in Bitcoin a good idea

However, it is important to check your country’s tax laws for holding digital assets and other legal aspects. After the Internet, cryptocurrency is the next in line to be the major event humanity witnesses in the future.


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