Bitcoin seems to be hitting the news again with stories of huge gains made by those trading in bitcoin. How does Bitcoin sit in terms of a good investment? We have seen price rises in the past only to be followed by a slump. But how can we tell if we are in a period of sustained growth or not?
Why is Bitcoin Making People Money Again?
Bitcoin last had a significant surge back in 2017; the price skyrocketed, much like today, before an almighty crash hit the market. What went wrong in that initial boom? There are many theories, but the one that holds the most water is that there was a glut of start-ups claiming to offer products and services that would be trading with Bitcoin, but most of these products and services never materialized in any significant ways, thus the currency crashed. The current boom is fuelled more by institutional investors and these expert investors tend to invest more capital and hold an investment for longer, making the boom more stable.
Have You Missed the Boat?
Getting in early for any investment is always the best way to make a profit, but that doesn’t mean there is no point in investing later. If the price is still rising, then there is money to be made for the time being. The trick is to know when to quit, and there will inevitably be a price drop, but when that comes and by how much is difficult to predict.
Where to Buy Bitcoin?
The good news is that with such popularity it is easier than ever to find somewhere to buy Bitcoin. With that being said, it is prudent to be aware that not all cryptocurrency exchanges are created equal. You need to ensure your chosen operator can guarantee a secure BTC wallet where your funds will be secure, and private.
Where Can You Spend a Bitcoin?
Part of the added appeal of Bitcoin this time around is that it has more mainstream credibility. Consumers can spend their Bitcoin in a variety of locations, both online and offline. As e-commerce becomes the norm, digital currencies are naturally going to seem more appealing. Major players such as Microsoft, Tesla, Starbucks, and Burger have all begun taking bitcoin as a method of payment.
What is the Future?
What does the future hold? This is the big question for anyone interested in Bitcoin as an investment. Over the short term, the future looks promising; few analysts are predicting a fall during 2021. With the world moving more towards a digital future, it makes sense that digital currencies such as Bitcoin will play a significant part in both the retail and investment sector. Looking longer-term, it is difficult to see what will happen with any precision. Even if cryptocurrency grows, there are no guarantees that Bitcoin will remain ahead of the pack; we can see new currencies appear every month.
This article has been contributed on behalf of Paxful. However, the information provided herein is not and is not intended to be, investment, financial, or other advice. For more details visit finscreener.