When it comes to currency investment, there’s no asset quite as mysterious and alluring as Bitcoin. The cryptocurrency, which exists in its own, never-before-seen form, has attracted millions of investors worldwide and has shown faster gains than any other asset in history. In its first 4 years of existence, it went from being worth less than $0.01 to a whopping $1,250. As of today, it is hovering around $1,000 and is one of the most volatile and unpredicted assets in the market. If you want to get in on the Bitcoin craze, here are a few things you need to know first
From Zero to Hero
Firstly, it is important to know the principles on which the Bitcoin system was founded. Bitcoin is decentralised, meaning there’s no central bank or government regulating it. It has no physical form and exists solely as encrypted digital code. Bitcoin is regulated by its creators, who are steadily adding more of the currency to the market at a decreasing rate. Their plan is to have 21 million Bitcoin in the world by 2109. Currently, there are about 15.5 million bitcoin.
Next, let’s try to understand what caused its unprecedented surge in price. At first, Bitcoin didn’t really have any traction. It was reserved solely for the early adopters, and there were very few businesses that accepted it as a payment method. In fact, the first transaction ever made in Bitcoin was for two pizza trays, which cost 10,000 Bitcoin in 2010. Today, those pizzas would have been worth around $9 million! As more and more businesses accepted the currency, it gradually went up in value. At the same time, people were starting to embrace the idea of a decentralised currency, and as more people jumped on board, prices began to soar.
Up, Down, and Up Again
Over the years, Bitcoin has displayed seesawing behaviour, reaching a peak, then crashing, then reaching another peak and crashing. This was the case up until it reached its all-time peak in 2013, which it has not been able to replicate since, despite c...