Many people consider the invention of cryptocurrencies to be one of the most important things that happened so far in the 21st century. This probably doesn’t come as a surprise because these things are becoming more and more popular every single day.
Although most people don’t have a clue about blockchain technology and how it works, they have heard of Bitcoin, which is the most popular digital currency in the world. During its first couple of years of its creation, people didn’t believe in it, which is why it was really cheap.
However, in early 2024, Bitcoin’s price exploded, which is why people started to be more interested in it. Besides popularizing cryptocurrencies, this payment method also affects many other industries. For example, you can find numerous Bitcoin betting sites where you can bet with this digital currency. Moreover, many online shops have started to accept crypto payments.
With that said, let’s take a look at a few reasons why Bitcoin’s price increases.
Inflation
One of the primary reasons why Bitcoin’s price is going up is inflation. Nowadays, the US dollar’s purchasing power is not as high as it once was. That’s because there are loads of circulating dollars, especially after the coronavirus crisis. According to some sources, around 50% of the dollar bills were printed in 2020.
In an attempt to “save” their money, some people see Bitcoin as a way to increase their net worth. That’s why they invest a lot of cash into it, which reflects on the price. Don’t forget that we know exactly how many Bitcoins are there right now and how many will exist in the future. In other words, this cryptocurrency is one of the few assets that we can prove has a fixed supply.
Big companies purchase Bitcoin
The second reason that has a major effect on Bitcoin’s price is that some of the world’s biggest companies decided to purchase a lot of Bitcoins instead of holding cash. One of the most popular companies is Square, but people like Elon Musk are also interested in this digital currency.
People have started to understand this currency and use it
Another thing that has a major effect on Bitcoin’s price is the fact that some people finally learned how it works and where they can use it. As a result, even casual investors decided to invest a certain amount of money into it.
Many people included Bitcoin in their portfolio because this is one of the few assets whose price can increase considerably. However, similar to other cryptocurrencies, Bitcoin is highly volatile, so keep that in mind before investing.
It’s easy to access it
Unlike many years ago, where there were hardly any cryptocurrency wallets, nowadays, everyone can download an app on their smartphone and tablet and purchase Bitcoin in just a matter of seconds. This definitely affects this digital currency’s price and will probably continue to play a significant role in the future.
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