Since its advent in 2009, Bitcoin (BTC) has transformed from a mere digital white paper into billions of dollars in market value. In 2018, the preeminent crypto exchanged for $3,000. Today, the narrative has changed, as BTC sits somewhere a little above $63,000. Without a doubt, the growth spurts are unprecedented. As a result, everyday people are leading the good life they never thought possible. Still, the crypto market has created tens of thousands of jobs around the world. In other words, the digital coin is not a mirage because it is changing lives the world over.
Little wonder companies are racing to launch their digital coins so as to cash in on the burgeoning crypto space. As a traditional stock investor or Bitcoin critic, you may be skeptical about Bitcoin. Guess what, you are not alone. However, there are certain factors that drive the BTC market value. No doubt, those factors are most likely to sustain its positive growth trajectory for a long time. Yes, those factors have already positioned the digital money to become the next big thing. Let’s check them out together.
Meet Bitcoin, the Next Big Thing
Here’s why Bitcoin is a must-have:
- Decentralization: Bitcoin lies on a trustless network that does not permit a single node control. To be crystal clear, the crypto is built on blockchain technology, a decentralized, peer-to-peer technology used for recording digital information. Because Bitcoin is built on this network infrastructure, it means that no third parties determine what happens around the system. In contrast, the government decides the amount of fiat currency (government-issued currency) in circulation.
- Feeless transfers: Let’s assume you have to pay your staffer somewhere in Malaysia. You need to transfer some US dollars from your Wisconsin bank account to another bank account in Asia. To achieve that, you have terribly bad options. First, incur high transaction fees and have the transaction processed in a couple of hours. Alternatively, you will wait for days to have the payment processors execute the transfer. You don’t really blame your bank because the transfer will go through multiple channels, your bank, SWIFT, and your employee’s bank. Of course, you will have to choose between the devil and the deep blue sea. But then, bitcoin transfers occur in a split second because it shatters geographic boundaries and interborder banking protocols.
- Tamperproof ecosystem: While hackers can compromise a bank account, it is near possible to do the same to the bitcoin network (distributed ledger technology). The reason is that the crypto leverage a trustless network that uses PoW (Proof of Work) consensus mechanism to function. Simply put, every node in the Bitcoin ecosystem must agree to a request for change from a certain node before the alterations are made. Until there is a consensus on the request, the system does not approve any transaction. This makes Bitcoin pretty uneasy to hack.
- Overnight fortune: Let’s say your friend, Jack, bought one Bitcoin for $3,000 in 2018. Just like everyone who saves in banks, he left the virtual currency in his wallet till March 2021. Don’t be surprised to see Jack riding in his dream car. Sure, Bitcoin’s market value is now $63,000. Nope, Jack didn’t hack the Federal Reserve Bank. He is just one hell of a smart investor! Yes, his investment paid off! Yes, that’s one of the heartwarming facts that shows Bitcoin is unstoppable.
- Transaction Anonymity: Before you open a bank account, your bank will do KYC (know your customer).This means they know your address, identity, valid ID, etc. In contrast, you don’t undergo a KYC process before owning a Bitcoin wallet. More often than, your digital wallet manager will only ask for your email address before creating one for you. More importantly, nobody gives a hoot who the sender or receiver of funds is. The wallet (app) generates the address that allows you to receive funds. That way, identity remains anonymous.
Conclusion
In conclusion, you have seen some of the features that sustain Bitcoin in a league of its own. These features continue to give the crypto the edge over altcoins and fiat currency. To draw a conclusion, it will make sense to understand the functions of money.
By and large, money (fiat currency) has 3 fundamental functions:
- Store of value
- Medium of exchange
- Standard for payment (unit of account)
Without a doubt, Bitcoin can perform all these functions, meaning that you can classify it as money. Because Bitcoin mirrors an improvement in the deficiencies of today’s fiat currency, many crypto proponents believe that it can potentially replace government-issued money. Plus, more and more merchants are accepting Bitcoin, which positions it as the currency of the future. With all the positive buzz around Bitcoin, there is no denying the fact that it will certainly become the next big thing! So, have you jumped on the BTC bandwagon yet?
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