Bitcoin is probably the first cryptocurrency that became widely recognized all over the world, even by those people who have no notion of how the crypto market works, how coins are mined, or what the blockchain is. Bitcoin quickly became a part of the modern pop culture, thanks to the fact that it appeared during one of the most severe economic crises in 2008.
Everyone who has access to the Internet has heard about Bitcoin at least once in a lifetime. News about this digital asset quickly become the most frequently discussed in the financial sector. For instance, the headline about the recent crash of Bitcoin that happened in May headlined all the media related to the industry of finances and even those that inform about finance events not very often.
After such a hype, many people who haven’t invested in Bitcoin, asked a simple question – is it a good time to do this today? Will Bitcoin go up? We think yes, and here is our proof.
How does Bitcoin work?
When people are willing to learn how digital money works, they start exploring the key peculiarities of Bitcoin. That is the right decision because the concept of digital currency is not as complex as many of you probably think.
The first notable difference between Bitcoin and fiat currencies is that BTC doesn’t have a physical form. It is a completely digital asset. The second big difference is that it is transferred between two parties and operated without the intermediary of banks or other financial institutions. Therefore, Bitcoin is decentralized, which means it’s completely independent of the national bank or financial authority of any country.
You might be curious about how bitcoins are created if they don’t have any physical form. Bitcoins are mined with a special encrypted code by using special equipment. The total amount of bitcoins that might be mined amounts to only 21 million coins.
Key Events Impacting Bitcoin Price
- When Bitcoin was launched, it was worthless. However, the developers of the assets chose the right time to introduce the coin. People, who were still under the impression left by the financial collapse in 2008, started looking for alternative ways of storing money. The main purpose was to find a method that would be effective in hedging against inflation. BTC met these requirements. Within the period between 2008 and 2011, the BTC price increased from $0.09 to $29.60.
- 2013 was also an important year for BTC and those who explored cryptocurrency trading. At the beginning of the year, the BTC price amounted to $13.28. By April, it exceeded $200 and in December Bitcoin was at around $1,230. In a few days, after such a growth, it fell to around $680. Nevertheless, the returns were quite impressive for those who invested money at the beginning of the year, when the coin didn’t cost even $15.
- Bitcoin became truly mainstream at the end of 2017 when its price surged to $19,345. This increase quickly attracted the attention of big investors, financial institutions, and publicity. Due to the high volatility of the market, the price rates decreased to around $6,000 by December 2019, but the hype around the coin remained loud.
- The breakout of the coronavirus pandemic in early 2020 made Bitcoin widely discussed again. Due to the economic lockdown, the coin managed to increase from around $6,000 up to $29,000 throughout the year.
- In 2021, Coinbase, one of the most widely-recognized crypto exchanges, went public. Because of this, in April, the BTC price blasted through the mark of $60,000, which was a record height for the asset. By the middle of summer, rates crashed by around 50%, however, the coin managed to recover by the end of Autumn and reached $68,700. At the end of 2021, the coin was closing at around $46,000.
- Recently, in May 2022, many cryptocurrencies, including Bitcoin, collapsed. On May 11, BTC fell to $28,305, which is the coin’s minimum recorded throughout the passing year.
Trade Bitcoin with DotBig
In the following paragraph, we are going to reveal the pros and cons of investing in Bitcoin. However, before you get them explained, you need to find a platform where trading BTC will be profitable. Create a private account, DotBig, and you won’t regret it.
DotBig.com is a good option for trading on the crypto market because it offers more than 600 crypto-related products. You can access both cryptocurrencies, cryptocurrency pairs, and CFDs on cryptos. With the low spreads charged by the DotBig forex broker, trading here becomes more cost-efficient than with other platforms.
DotBig.com has a lot of advanced tools that will help conduct an effective market analysis and react to all the changes promptly. With such solutions, clients of the DotBig forex broker can make trading almost 100% automated and earn passive income in different markets.
Pros & Cons of Investing in Bitcoin
- Bitcoin is a top-rated cryptocurrency. The project has a great reputation and cool potential for providing extremely high returns in the future.
- The bitcoin architecture offers one of the best safety systems that protect users against potential fraud.
- No government, authority, or bank can control or regulate bitcoin. It’s completely decentralized and independent, which makes a huge difference between it and any fiat currency.
- Bitcoin provides great transparency.
- Bitcoin offers an immediate settlement.
- As you may see from the history of price changes, the crypto market is extremely volatile and the downside movements in bitcoin’s price rates might be very big.
- The chances to gain big profits are as big as the chances to suffer huge losses.
Many investors refuse to invest in bitcoin after the first losses. Bitcoin is a good investment, but you should try to minimize the risks. Experts say that the good way is not to make the bitcoin asset the main diversified of the portfolio. Don’t make your portfolio too reliant on Bitcoin, and then you will have better chances to get good returns.