How has bitcoin become the most accepted crypto?
In today’s time, most of the work is being done digitally and if we talk about a famous digital currency then bitcoin is one of the most popular currencies. Its value is increasing day by day as an increasing number of investors are optimistic about making it a popular asset and thus betting big on the potential of the cryptocurrency. Bitcoin has inspired robust innovations since its inception, and Bitcoin cash was developed years after but people still want to know how it is different from Bitcoin.
The continued volatility of bitcoin makes it a bit difficult to track the price of BTC, although it has reached higher levels and even cryptocurrency experts predict that the digital currency will continue to rise in the future. However, when the value of the bitcoin increases, it appears that a parallel argument exists between a bitcoin bear market and a bull market. While bull markets are expected to see bitcoin become a mainstream asset, bear markets show how unpredictable the digital currency has been in the past. Bitcoin has started to become more volatile since the catastrophic recession that occurred in 2018 and completely rebounded significantly in 2022. In the last year, the digital currency has seen a growth of over 800 percent.
So, why is the controversial digital coin increasing in value so quickly? Below are some possible explanations:
The popularity of bitcoin in times of pandemic
If we talk about bitcoin in the pandemic situation, its popularity took a significant hit in the year 2018 and it went dormant for a long time in the year 2019 and started to gather steam if seen in the year 2022. Covid-19 came out as an outbreak all over the world, causing havoc to the entire economy and due to this, the whole world was forced to implement a lockdown. The following variables were the ones that severely affected the global economy, as well as caused more damage to popular investments and properties of all kinds.
The currency was written off only a few years ago by most experts, but it has been on the rise since then as digital money has been deposited by many such leading brand investors and companies. Crypto is increasingly being adopted by investment portfolios worldwide as an alternative asset to traditional assets such as money, stocks, and gold. Financial services providers and a global investment bank believe that BTC’s volatility could rise sharply in the future if volatility remains under control.
An Alternative Asset
During the pandemic, many investors moved their money to safe havens such as gold, and some opted to bet on the unconventional bitcoins. However, both these types of investors have benefited if seen. But if we talk about getting the most profit, the investors who have invested in bitcoin have got four times more profit than the investment made in gold. Most are international investors who invest in digital coins.
Limited Stock Available
Another possible reason for the cryptocurrency craze as seen at present is that bitcoin may even be banned from existence. It should be noted that the total number of bitcoins available is limited to approximately 21 million, of which approximately 18 million are currently in circulation and produced. The value of bitcoin was completely unchanged by the pandemic because its availability could not be increased, whereas if we were to talk about fiat currencies, on the contrary, it decreased due to the increase in the printing of money. Then the following year, bitcoin saw another sharp drop and a frantic sell-off.