Will bitcoin help you to double the money or trouble the money?
Cryptocurrency bitcoin turns out to be the best investment option in 2020–21 as it has provided 800% returns.
With the price of a bitcoin surging to new highs in 2021, the bullish case for investors might seem so obvious it does not need stating. Alternatively, it may seem foolish to invest in a digital asset that isn’t backed by any commodity or government and whose price rise has prompted some to compare it to the dot-com bubble; the bullish case for Bitcoin is compelling but far from obvious. There are significant risks to investing in Bitcoin, but, as I will argue Because bitcoin is hope.
How does it work?: In layman's terms. It works on a basic principle i.e Demand and Supply That we all have learned in economics. So there are only 21 million bitcoins of which 18.5 million have been already mined. Every four years the number of bitcoins produced by mining halves and the production of new bitcoins will end completely by the year 2140.
What backups bitcoin :
Bitcoins are neither backed by any physical commodity nor are they guaranteed by any government or company, which raises the obvious question for a new bitcoin investor: why do they have any value at all? Unlike stocks, bonds, real estate, or even commodities such as oil and wheat, bitcoins cannot be valued using standard discounted cash flow analysis or by demand for their use in the production of higher-order goods. Bitcoins fall into an entirely different category of goods, known as monetary goods, whose value is set game-theoretically. I.e., each market participant values the good based on their appraisal of whether and how much other participants will value it.
Volatility: Bitcoin’s price volatility because it's new. In the first few years, Bitcoin behaved like a penny-stock. As adoption and liquidity have increased over the years, Bitcoin’s volatility has decreased. When Bitcoin achieves the market capitalization of gold, it will display a similar level of volatility. As Bitcoin surpasses the market capitalization of gold, its volatility will decrease to a level that will make it suitable as a widely used medium of exchange. So volatility of bitcoin isn't indicating “pump and dump”.
Accountability: According to many investors and cryptographers bitcoin is a new gold. Just like Gold is limited, Bitcoin is also limited. Unlike gold, bitcoin is easily transferable and also helps beat inflation. Hopefully, soon it will more be trusted than gold.
Conclusion :
Bitcoin is incipient money that is transitioning from the collectible stage of monetization to becoming a store of value. It is possible that at some stage in the future Bitcoin will become global money much like gold during the classical gold standard of the 19th century. The adoption of Bitcoin as a global money is precisely the bullish case for Bitcoin. Bitcoin is a better asset class as it is more liquid, has no holding charges. The more early we adopt it the better it is. If you feel you are late to this, don't worry we have miles to go. So it's neither bubble nor trouble
There are only 21 million bitcoin and the net wealth of world is $360 trillion, which give almost $17 million per coin.
A few years from now, that monetary base will be Bitcoin.
If you are new and want to invest in bitcoin and other tokens Wazirx is a good platform, also it is made in India. And if you need a foreign exchange coinbase is also a good one. I personally use WazirX and Trust wallet. If you still have fear to invest in crypto and more comfortable with stock you can buy Coinbase shares.
If you think the government would ban Cryptocurrency, I don't think so it's difficult.
Reserve bank of India’s liberalized remittance scheme (LSR) allows residents to invest up to $250,000 a year in stocks, bonds, and properties among other things.
Disclaimer: The views presented in this article and any errors herein are my own.
This article is for information purposes only. It is not intended to be investment advice. Seek a duly licensed professional for investment advice.
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