Satoshi Nakamoto created Bitcoin, a virtual currency, in 2009 to respond to the 2008 financial crisis. This digital currency has had its share of success stories and, at the same time, negative accounts. Some investors have earned massive amounts of money from their Bitcoin investments, while others have lost a lot. Either way, the public should invest in this electronic currency wisely.
There are a lot of merits that this digital currency presents to its investors. These advantages are what motivate people to keep investing in this electronic currency. Here is how Bitcoin encourages people. So, if you are planning to trade Bitcoin, you can use a reliable trading platform like Bitcoin Motion
Bitcoin is a currency that people can use to transact from any point in the world to another. There’s no central body that regulates Bitcoin’s daily transactions. Hence, there are no restrictions when transacting with this digital money at any point of the day. Traditional financial institutions like banks are not always open 24/7. Therefore, people have limited days and hours to transact conventional currency.
What’s more, entrepreneurs who have businesses operating on the international platform can utilize this electronic currency to complete cross-border payments. Authorities do not have to decide how this electronic currency will be available. This digital currency moves freely from one account to another via exchanges. Therefore, the way this electronic currency functions is different from fiat currency. As a result, conventional money does not motivate people to make international payments as Bitcoin does.
Bitcoin is not subjected to inflation as fiat currency does. That is because Bitcoin has a limited supply, whereby Nakamoto created a protocol stipulating that only 21 million Bitcoins can ever exist. Consequently, this electronic currency’s scarcity increases its demand, translating to a rise in the value of this digital money.
On the other hand, fiat currency does not have a limited supply as the bank can publish more money and release it to the public. This unlimited supply is what results in fiat currency losing its value. In the end, investors will opt to use Bitcoin as a store of value since this electronic money is a perfect hedge against inflation.
This digital currency has an underlying technology that facilitates transactions known as the blockchain, a public distributed ledger that records all crypto transactions. As a result, the government can utilize blockchain technology to fight corruption in the country as it will record all transactions publicly. Additionally, Bitcoin ensures that these digital money users remain completely anonymous. The blockchain does not reveal the addresses of its users. Therefore, people cannot trace a transaction back to whoever sent this digital money or the recipient. In the end, this digital currency motivates people to enjoy anonymity and transparent transactions at the same time.
High Return Potential
Bitcoin is notoriously volatile, whereby the prices of this digital money can change drastically daily or even monthly. However, as much as this digital asset is volatile, it still motivates people to invest due to the high return potential. Additionally, some people view this electronic currency as the future of money. There is increased adoption of this virtual currency by businesses and many investors. As a result, increased adoption helps increase the higher returns potential, especially for those who bought this digital currency at a lower price.
Also, the limited supply of this electronic currency motivates some investors to believe that Bitcoin will gain value in the long term.
The Bottom Line
There are a lot of significant ways by which this digital currency motivates the public. Bitcoin is a perfect store of value and an ideal hedge against inflation. And this encourages people to invest in this electronic currency.
Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions.
Cryptocurrency trading involves high risk, and is not suitable for all investors. Before deciding to trade cryptocurrencies, tokens or any other digital asset you should carefully consider your investment objectives, level of experience, and risk appetite. TaxGuru does not recommend that any cryptocurrency should be bought, sold, or held by you. Do conduct your own due diligence and consult your financial advisor before making any investment decisions. By the use of the above information, you agree that Author / TaxGuru is not responsible or liable in any manner for the authenticity, accuracy, completeness, errors or any kind of omissions in this piece of information for any action taken thereof.