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What Makes People Go Crazy for Bitcoin? : 5 Points Everybody Must Know

People are getting crazy for Bitcoin. Bitcoin  is often referred to as digital currency and as an alternative to central bank-controlled money. It is valuable because it is issued by a monetary authority and is widely used in an economy. Bitcoin’s network is decentralized.

People go crazy for Bitcoin because of following 5 reasons:

1. Limited in Number:-

The belief that resources are scarce  and limited is a misunderstanding of the nature of scarcity, which is the key concept behind  economics.  Human brain functions in such a way that if something is less in quantity that is considered to be more valuable. It happens with any other resource also.

For the first time humanity has access to a commodity whose supply is strictly limited.  No matter how many people use the network, how much i’ts value rises and how advanced the equipment used to produce it, there can only ever be 21 million Bitcoins in existence.  there is no technical possibility for increasing the supply to match the increased demand. If more people want to hold Bitcoin the only way to meet the demand is through appreciation of the existing supply.This creates a new type of asset which encourages people to store it for its value.

All other forms of money are unlimited in quantity  so they do not have an ability to store value across time.

Also read about: Ethereum Merge.

2. Sovereignty:-

Bitcoin is the first giving access to the sovereign base money.It gives economic freedom to the person who owns it, which was never possible before its invention.  Bitcoin holders  can transfer large amounts of values across the planet without having to ask for the permission of anyone.

Bitcoin’s value does not rely on anything physical so it can not be taken away or destroyed by any political or criminal force.

This is the first solution we got to escape from the financial hard-hit of the government

Money in general is regulated by the government and people had no option than to put their money in banks, which made them  dependent on banks which were regulated by the government for their survival and well-being.  Such is not the case with Bitcoin  because it is totally decentralized and nobody controls it. With Bitcoin, verifying transactions is trivial and virtually cost free and anybody can access the transactions ledger from any internet connection device for free.

If Bitcoin continues to grow to capture a larger share of global wealth, it may force governments to become more and more a form of voluntary organisation which takes the taxes for the service, which the payer is willing to take.

In the coming future it will produce interesting and very important changes in the nature of economics and social systems.

Also read about: Interesting facts about cryptocurrency.

3. Technological Innovation:

Bitcoin is built on groundbreaking technology known as blockchain, which has the potential to revolutionize various industries beyond finance. The underlying technology and its potential applications generate interest and excitement among technology enthusiasts, developers, and those interested in disruptive innovations.

4. Potential for High Returns:

Bitcoin has experienced significant price appreciation since its inception in 2009. Some early adopters and investors have made substantial profits, which attracts others to the potential for high returns. The allure of getting rich quickly can be a driving force behind people’s fascination with Bitcoin.

5. Store of Value and Inflation Hedge:

Bitcoin is often considered a potential store of value similar to gold. Some people view it as a hedge against traditional fiat currencies and inflation. In times of economic uncertainty or when traditional financial systems face challenges, Bitcoin may be seen as a way to protect wealth.

It’s important to note that while some individuals are genuinely enthusiastic and believe in the potential of Bitcoin, there are also speculative elements and risks involved in the cryptocurrency market. It’s crucial for individuals to conduct thorough research, exercise caution, and understand the volatile nature of Bitcoin and other cryptocurrencies before getting involved.

Ruchi Tomar
Ruchi Tomarhttps://financiallanes.com
A full time blogger from last 1 year. experienced in content writing.
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