Cryptocurrency is becoming more and more popular than ever before, with bitcoin acting as the leader of this movement. With recent successes from blockchain technology and the broad acceptance of cryptocurrencies by various financial institutions such as Western Union, there has been an increase in new investors seeking to jump on board the crypto gravy train to gain profit. So the question on many people’s minds is: why is cryptocurrency getting popular, and how can I profit from it?
Cryptocurrency has been steadily increasing in value since its introduction in 2009. As of November 2017, a single Bitcoin is valued at USD 9,600.01. This astronomical increase has led to an explosion of cryptocurrency enthusiasts seeking to get involved by buying into this new form of virtual currency. Today, Bitcoin isn’t the only player in the crypto game; over 1,000 different cryptocurrencies are available for purchase, with most being ERC20 tokens built on top of the Ethereum blockchain platform. With each new cryptocurrency introduced, the popularity of crypto increases even further.
Top reasons for the popularity of bitcoin
1. Speculation
One of the reasons for the popularity of cryptocurrency is speculation. In other words, people invest in crypto because they think it will make their money. The best example to illustrate this point is Bitcoin. Bitcoin started increasing in value roughly around early 2013, and since then, it has been one of the most traded currencies in Cryptocurrency exchange markets across the globe. Many more such examples of cryptocurrencies have gained immense popularity because people speculated that their value would rise exponentially over time. Hence, they invested money into these altcoins. Furthermore, any cryptocurrency with a decent market cap can be subject to speculation at any given time.
2. Easy money
Vast amounts of money are poured into the crypto market from venture capital firms and other large money management firms interested in investing in cryptocurrency. The fact that cryptocurrency is an unregulated market makes it an attractive option for large investors. This has a lot to do with the fact that no one controls cryptocurrency, so their prices aren’t directly correlated with fiat currencies. By investing in cryptocurrencies, you need to check how reliable bitcoin is and speculate on whether their prices will rise or fall in the future.
3. Decentralisation
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The fact that cryptocurrency is a decentralised currency is why it’s popular. People prefer to use cryptocurrencies as opposed to fiat currencies because there aren’t any middlemen involved in transactions in cryptocurrencies. There are no banks or regulatory bodies involved, and so people love the idea of being able to trade with one another without these intermediaries.
4. Technology
The technology used to create the cryptocurrency is very advanced, and the technology used to mine the cryptocurrency will indicate that this money means more than just money. It’s a technological innovation that has made many people very rich in a short time as you are reading this article itself.
5. Anonymity
Cryptocurrencies are anonymous and can be used for illegal activities to conceal identity. This adds to the appeal of Bitcoin since a person is not required to reveal their identity while making payments with Bitcoins. This kind of anonymity makes it appealing to criminals, and other criminals will likely be attracted to such a currency. Also, there are electronic wallets that store your private information in multiple locations worldwide, so this currency cannot be tracked by third parties such as banks or law enforcement agencies etc.
Increasing support of cryptocurrency comes from investors who have gained huge profits after taking advantage of the volatility of these currencies by purchasing and selling them at peak times. While it is difficult for the average investor to take advantage of this volatility since most cryptocurrencies are only traded on online exchanges, there is still a way to get involved by purchasing Bitcoin or any other currency on an online exchange and then storing them in a personal wallet. Once you have purchased your cryptocurrencies, you can continue fulfilling your investment strategy by buying and selling at peak times.