Should I invest in Bitcoin?
Anything I state is not to be used as financial assistance.
That being said, bitcoin is definitely worth considering.
And with bitcoin crossing the $10k threshold earlier this week, it’s no wonder individuals think it’s a bubble. It fallen below $1, 000 in June of this year, and has absolutely skyrocketed ever since.
Investors tend to poopoo cryptocurrency for its incredibly volatile markets.
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With volatility, though, comes drastically increased profit margins. In less-than-6-months, bitcoin has increase in value by more than 1, 000%.
To many it’s a sure indication of a bubble. To others, it’s an unique chance to make a fortune inside a short period of times.
But let’s step back for a second. Think about it in terms of economics. When you look at a supply and demand graph, you see that because supply increases, demand decreases. So that as supply decreases, demand increases.
This is known as an inverse relationship.
Requirement is created through something called “scarcity”. Scarcity means to be in short provide. Think about it like water in a design. There’s little water available, and therefore demand drastically increases.
On the flip side, rainfall during a monsoon is in extreme extra. And people want nothing to do with a lot more water.
These are examples you see within real life, but let’s look at scarcity, in terms of crypto.
There will only actually be 21 million bitcoins mined. In the world, there are roughly 33 million millionaires.
Even if every one of those millionaires wants a whole bitcoin, it’s difficult. There are simply not enough bitcoins to visit around.
Scarcity builds demand.
At this point, in the United States (and other well-off countries), people don’t necessarily see bitcoin as anything other than an investment. Yet that mindset fails to take into account those who are affected by economic crises.
Consider Venezuela. They’re facing more than 4, 000% of inflation. Their fiat currency is essentially useless. As of August 2015, there were about 450 companies that will accepted bitcoin. In November 2016, there were more than 85, 000 agreeing to the cryptocurrency.
That stat is a year old, and Venezuela continues to be plagued with an economic death spiral. So , the number is surely higher.
In fact , greater than 100, 000 miners have entered the game in the country. Bitcoin is more stable the Venezuela’s fiat, and thus can be considered a viable form of currency.
Now, we’ve seen bitcoin’s value in the eyes of the wealthy, and we’ve noticed its value in the eyes of those in economic crises.
So to answer your question, yes. Bitcoin is worth considering as an investment.