Why Bitcoin is Ruling the Cryptocurrency?

Why Bitcoin is Ruling the Cryptocurrency?

Cryptocurrencies have continued to see growth despite the global pandemic wreaking destruction on all significant economies on the planet. Cryptocurrency market capitalization stoked by Bitcoin’s growth lately crossed the $1 trillion target. 

Out of which, Bitcoin, has been on a bull run for quite some time and is roughly 69% of the total market value. Just six months ago, the price of one Bitcoin was ~₹6,00,000, and today Bitcoin is exchanging for ~₹25,00,000 which is about a 400% rise in the price. 

• Cryptocurrencies, particularly Bitcoin, are now being viewed as a safe-haven asset against market levity and expansion. The current economic climate also brings about a situation for people to hold less cash and stay hedged against market swings. Many companies have followed this trend. The reliability of corporate MNC’s on cryptocurrencies has joined more merit to it as a currency and value store.

WHY THE BITCOIN RISE?

It sparked a massive crash lately when the country’s central bank, the People’s Bank of China, completely banned digital coins by assigning all transactions illegal. Yet the crypto market has recovered and seen long-term gains when analyzing estimates since the start of the year – this is why crypto especially Bitcoin is up today. The unexpected rise in the cryptocurrency world could also be a result of traders purchasing up bitcoin to fulfill positions they were short on, having bet its value would fall more. “The short restraint that appeared in Bitcoin towards the end of the weekend gave a boost to the entire cryptocurrency market. 

WHERE WILL THE BITCOIN STAND IN THE UPCOMING TIME?

Financial specialists viewed this question for Finder. A majority of panelists prognosticate it will be another solid year for bitcoin, with specialists calculating a price of US$94,967 on average for Bitcoin in the expected few days. Even with Bitcoin’s wild value swings and interests in its energy usage, billionaire venture investor Tim Draper predicts the crypto will reach $250,000 by the end of 2022 or early 2023.

SHOULD ONE INVEST IN A BITCOIN?

• Bitcoin is extremely unstable, but if you are ready to take the risk, first make sure you know what you are investing in and have a crypto investment plan.
• It’s most useful to see it a bit like gambling so only invest a small amount of your income. 
• Cryptocurrencies are global, meaning they have the equivalent amount in every country and no exchange rates. 
• Most average investors would not think of speculating on pure currencies such as the US dollar or Japanese yen. This is because currency trading is seen as a very professional, full-time activity.

HOW RISKY IS INVESTING IN A BITCOIN?

Crypto is very risky and not like regular investing in the stock market.
Bitcoin’s price is based purely on speculation. This is different from company stocks where the share price will move depending on how the business is performing.
In October 2020, Bank of England governor Andrew Bailey said he was “very annoyed” about people using bitcoin for payments. He earlier suggested that crypto investors should be prepared to lose all their money.

WAYS TO INVEST IN A BITCOIN –

Buy shares in the bitcoin-related company 

You could spend in cryptocurrency exchanges or even buy shares in companies that are holding bitcoin as payment.

Bitcoin funds

Many investment companies are starting bitcoin funds. It will still be unpredictable, but it could be easier to sell your investment and get your money back than investing quickly. Some funds have some vulnerability to bitcoin as well as traditional assets like shares and bonds.

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