Is Bitcoin just a bubble? Should you invest in Bitcoin in 2021?
Bitcoin has fallen, making people believe that it is nothing more than a big bubble. Let's Discuss.
On 8th January 2021 Bitcoin reached a record-breaking value of $40,258. And as you can imagine it became the talk of the town and everyone wanted to invest in bitcoin. But, a week later the value started to fall which led a lot of people to believe that bitcoin is nothing more than just a bubble.
This might be true as the same happened in early 2018 when the bitcoin value reached up north of $20,000 and became the talk of the town but within days it fell to the range of $3,000 - $6,000. But we dive deep into bitcoin analytics. Let's define the layman’s definition of a bitcoin of what it is and how it works.
What on Earth is a Bitcoin?
Bitcoin is a cryptocurrency invented in 2008 by an unknown person or group of people using the name Satoshi Nakamoto. There are a lot of articles on the internet that will tell you exactly how does bitcoin works but to be honest, most people would be just fine without knowing it. But the knowledge that you must have is it's investing opportunities, oh boy we have a lot to unfold here. Let's first talk about the projected future of bitcoin.
Bitcoin Projections (Next 5 Years)
According to the experts, bitcoin could be worth upwards of $400,000 in the next 5 years and most likely will be worth more than $1 Million in this decade alone. A major tesla investor has gone as far as predicting that Bitcoin will have a market cap of over $1 Trillion in the upcoming decade. So, in reality, it's riskier to not have a bitcoin than having it. To sum it up, having a Bitcoin in your blockchain wallet is a no-brainer but how do you acquire one? Yes, there are more ways to acquire a bitcoin than just to go ahead and buy it.
How to Get a Bitcoin?
You can directly buy a bitcoin online or Mine it. For the uninitiated, mining bitcoin is solving problems on the blockchain which controls the transactions of bitcoins, and in return, you are rewarded with a percentage of bitcoin, and this process requires a lot of computing power as the more bitcoin you mine the harder it is to extract. There are only a limited number of bitcoins available on Earth, 21 million to be exact out of which 18 million have already been extracted. Fun fact, the last bitcoin is said to be mined in the year, 2145. There's a lot of things you should be knowing about mining bitcoin-like how powerful a processor you require to mine and how much electricity it would cost you to mine it.
Is Bitcoin Secure?
One thing that might've crossed your mind is what would happen if blockchain is hit by a malicious attack by hackers? So, just to put things in perspective, for extra protection, you should keep your bitcoins in blockchain but, be sure you don't forget your password because if you do, there is no way to recover it. Recently, it was reported that an early investor in bitcoin, Stefan Thomas owned around 7000 Bitcoins, which is worth around $245 Million today but isn't able to access it because he forgot the password to his hard drive which stored all the bitcoins. Also, about 20% of all bitcoins that are ever mined are lost or stranded in the locker.
At last, all I can advise you is to know more about bitcoin because there is a lot of stuff to know about it like where should you store bitcoin if you want to get an interest in bitcoin, Why there can be no tax that can be imposed on bitcoin? Why the government can’t ban it? And a lot more things. Maybe you can watch this episode of Logan Paul's show Impaulsive (Warning: foul language is used occasionally) where Andrei Jikh, a cryptocurrency expert talks about his knowledge of bitcoin and many more things.
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