Why cryptocurrencies are a great long-term investment
The market for cryptocurrency has been heating up in 2020. With the incoming 2020 presidential election, economic uncertainty is a situation compounded by the current coronavirus crisis.
Thanks to their utility as a store of value and use in payments has sparked interest in cryptocurrencies such as bitcoins.
In response, cryptocurrencies have seen something of a rejuvenation in 2020, with Bitcoin prices breaking the $10,000 after an extended bear market. With investors on the lookout for stable, alternative investments, Bitcoin has been seen by some as a viable for gold.
So, with that in mind, we ask the question – are Bitcoins and other cryptocurrencies a viable long-term investment?
Let’s take a look:
1. Bitcoins are increasingly accepted
Less than a decade ago, the concept of digital currencies would seem to be an insane concept to many. Besides lacking any physical presence i.e. notes or coins, cryptos are decentralized and not issued/controlled by any authorities.
Because of this, electronic currencies were relegated primarily to the domain of online gaming. Thanks to evolving mindsets and a new generation of tech-savvy investors, cryptocurrencies have begun taking off in a big way.
From Microsoft to Wholefoods, many mainstream businesses have taken notice of this trend and begun accepting cryptocurrencies as payment. As technology begins playing a larger role in our lives, we can only expect the acceptance of Bitcoins and other cryptocurrencies to increase with time.
Hence making this one more reason why digital currency can be a viable long-term investment.
2. Bitcoin mining will become increasingly expensive
In the early days, Bitcoins could be mined with basic equipment and a relatively quick internet connection. Nowadays however, the situation has changed drastically, and mining operations have become an entire industry unto themselves.
As any Bitcoin enthusiast will tell you, Bitcoins undergo an event known as every 4 years. When this occurs, Bitcoins awarded to miners for verifying transactions on the blockchain are reduced by half, hence the name.
This and the complex hardware required means that on the long-term, the number of miners operating on the market will drop. Hence reducing the quantity of Bitcoins being released into circulation.
Bitcoins are of a finite quantity and a drop in supply naturally places upwards pressure on the price of existing Bitcoins. On the long-term, as less Bitcoins are mined and the cost of running a mining operation increases, one can only expect Bitcoin prices to appreciate accordingly.
3. The use of crypto in international trade
As can be seen by the COVID crisis, humanity will have to adapt accordingly if the virus is to be beaten. Minimizing contact with third parties and practicing social distancing are likely set to become the new normal.
The adoption of cashless payments and the move towards online shopping is one way of the ways in which we’ve adapted. That’s why apps like Tezro.com come in handy, allowing complete private chat and secure trades among crypto users.
Due to their very nature, cryptocurrencies lend themselves particularly well towards online shopping and cashless payments.
For example, Bitcoin can be transferred nearly instantaneously from one wallet to another with little-to-no fees required. Because of this, Bitcoins can have a significant impact on as it allows transactions to be performed instantly from anywhere around the globe.
Needless to say, this has caused great consternation amongst many governments. However, the potential uses for crypto on the international scene will nevertheless generate significant interest in the days to come.
It is clear that the world is heading in a new direction with cryptocurrencies. With its myriad of uses, Bitcoins and other cryptocurrencies are a game-changer. This is why they should be seriously considered as a long-term investment.