The last few months have not been easy for the cryptocurrency market. The combined market capitalization of all cryptocurrencies has fallen by nearly 70% since its peak in early January. That, in turn, has forced many investors to question whether now is the right time to invest in digital tokens or if they should wait until the bear market is over.
That being said, there are a lot of reasons why you should still invest in Bitcoin and other cryptocurrencies.
Here are 8 reasons why investing in Bitcoin and other cryptocurrencies remains a good idea.
What is Bitcoin?
Bitcoin is a decentralized digital currency without a central bank or single administrator. Instead, it uses an open network of computers to track and verify transactions. Bitcoin is the most used cryptocurrency because it was the first cryptocurrency ever created. It is also the most secure blockchain with a total market cap of $76 billion.
The Bitcoin network is operated by decentralized computers across the globe. The blockchain is the technology that allows Bitcoin to exist. It ensures that all transactions are secure and that there is no way to counterfeit Bitcoin.
Why Buying Bitcoin is Still the Best Crypto Investment in 2022
There are many cryptocurrencies on the market today. You have a wide variety of options to choose from and buying cryptocurrencies is not as easy as it may sound. So, how do you buy bitcoin?
Here is how to buy bitcoin and below are the reasons why it’s the best crypto investment.
(1) Bitcoin is still the most secure coin
The most important feature for any cryptocurrency is its level of security. You don’t want to invest money in a coin or crypto wallet that might be hacked or stolen at any point in the future. Luckily for Bitcoin, it remains the most secure coin on the market.
There are two important reasons why Bitcoin remains the most secure coin: – The long-term mining profitability has remained high enough for professionals to keep mining Bitcoin. In fact, mining profit margins have actually risen to new highs in recent weeks.
This means that mining will remain profitable enough for large mining corporations to keep mining Bitcoin even if the price of the token drops. Bitcoin has a very high network hashrate. This means that there are enough mining computers on the network to defend the blockchain from attacks.
(2) Crypto Regulations Will Be Positive for Bitcoin
Bitcoin has long been criticized because it is a currency that is not backed by any government or central bank. But at the same time, this is actually one of Bitcoin’s biggest advantages. Central banks can print as much money as they want to create economic growth.
Bitcoin, on the other hand, has a hard cap of 21 million tokens. This means that governments cannot just print more money to solve economic issues. However, the fact that governments can’t simply print money out of thin air to solve their economic issues is actually a big problem.
It means that they have to raise funds through taxes, which can take a while. This has led to slower economic growth in many countries across the world leading to acceptance of bitcoin regulating and legalizing bitcoin transactions in countries such as France, Denmark, Germany, Iceland, Spain, Mexico, the United Kingdom, and Japan. This has been one of the biggest reasons why Bitcoin has been popular.
(3) Institutional Investors are Coming
Cryptocurrencies have been around for more than 10 years now. But because the market is completely unregulated, institutional investors have stayed away from the space for a long time.
This is about to change though. There are a lot of signs that institutional investors are finally coming to the cryptocurrency market. This is extremely significant because institutional investors have trillions of dollars at their disposal.
They also have decades of experience in the investment industry. As more and more investors enter the cryptocurrency space, the demand for Bitcoin will increase. It will lead to an increase in price, which will drive more investors to the space.
(4) Bitcoin is Still the Best-Known Cryptocurrency
One of the biggest indicators of the success of any product or service is if it is well known in society and has a network effect. Bitcoin is the most well-known and popular cryptocurrency.
This means that the more people who own Bitcoin, the more valuable it becomes. This is because Bitcoin is a borderless digital currency that you can use to send and receive money from anyone, anywhere in the world, in a matter of minutes.
There are no intermediaries involved because Bitcoin is decentralized. Because Bitcoin is the most well-known cryptocurrency, it is easier to convince new investors to buy into the coin and it has the highest brand recognition which makes it very easy for people to buy Bitcoin.
But what happens when another coin comes along and dethrones Bitcoin from the top spot? While this is definitely possible, it is not very likely. There is no second coin currently in the market that has the network effect that Bitcoin has. This means that new coins will have to work very hard to dethrone Bitcoin from the top spot.
Even if a new coin does manage to dethrone Bitcoin, the network effect will be very short-lived. This is because once a new coin dethrones Bitcoin, people will start investing in that new coin. This will drive the price of the new coin up and make the old coin worthless.
(5) Storage Costs are Negligible at this Point
One of the biggest reasons why people have not invested in Bitcoin is because they are afraid of losing their money. They are afraid that if they buy Bitcoin, they will lose all of their investment if the price suddenly drops.
No one wants to lose money, but the cost of storing your coins in a wallet is negligible. The only thing you have to be careful about is to store your coins in a wallet where they are safe from hackers.
And even if you do get hacked, there is a chance that your wallet will reimburse you if you lose any money. If you keep your coins in a secure wallet and don’t click on links from people you don’t know, you will be just fine.
(6) Bitcoin Will be Worth Way More in 10 Years
One of the biggest reasons why you should invest in Bitcoin now is because it will be worth a lot more in the future. The price of Bitcoin has increased from $0 to $9,000 in a matter of 10 years.
This is a growth rate of over 9,000% with the current price at approximately $19000 USD. Who knows where the price of Bitcoin will be in 10 years? How high will the price go? No one can say with certainty, but most experts agree that the price of Bitcoin will likely be in the tens of thousands of dollars in 10 years.
(7) Bitcoin ETFs are Coming Soon
An ETF is a fund that tracks the price of an asset. This means that ETFs are extremely attractive to investors because they are much safer than investing directly in the asset. ETFs are used in the stock market, but they can be used to track virtually any asset.
This means that there is a very high chance that a Bitcoin ETF will be released soon. Before a Bitcoin ETF is released, the SEC will thoroughly examine the market and make sure that there are no problems with the fund.
Once everything is cleared, the SEC will approve the launch of the ETF. This will launch a huge wave of investment from institutional investors who are not interested in buying Bitcoin directly. This will significantly increase the price of Bitcoin.
(8) Fast and Easy Transfer of Coins
The traditional ways of money transfer can be a cumbersome process. First you need to apply for credit cards or debit cards which is a process and has hidden fees. When you need to transfer money from one country to another, you have to go through a bank and then wait for the money to arrive. Especially when sending or receiving with a lump payment.
Companies will require you to provide your personal information and term it as know your customers (KYC). In some cases, financial institutions like PayPal place your money on hold or permanently limit your account. By using bitcoin, you don’t have to go through this stress because all that is required is your wallet and address.
Summing Up
There are a lot of reasons why Bitcoin is a good investment. The market has been going through a bear cycle for the last few months, which has created a lot of panic for investors. It is important to remember that these are the best times to invest in cryptocurrencies like Bitcoin.
If you have been hesitant to invest in Bitcoin because of the market situation, you should definitely consider investing now. And if you decide to invest in Bitcoin, make sure you do your research and find a good exchange and wallet to store your coins.
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Author: Cosmas Mwirigi
Cosmas alias Cosii-Riggz is a technology enthusiast and SAAS writer who helps clients understand products by explaining services for businesses.
He has been featured in websites such as PV Magazine and Bitcoin Kenya. During his free time, he likes traveling to new places and exploring what’s new on the internet. You can contact him on his LinkedIn page or email.
