Is bitcoin the gold of the cryptocurrency age?
Nowadays, our world runs digitally. We've practiced almost all real things virtually. It is not wrong to say that digital currency or cryptocurrency is the future of money. It is a strong belief that though risky, cryptocurrency is unequivocally profitable. Some people are ready to take this risk, while many are still doubtful.
Many people believe that cryptocurrency is not and never will be a popular currency. But it can still be a profitable financial asset. There are various reasons why the cryptocurrency is not the best payment option. The first and foremost reason is its volatility. For some time, the transaction confirmation times have increased. Till the time the transaction confirms, the price of the cryptocurrency changes. It means that the amount you've generally paid changes. That is, you end up paying the wrong amount. In addition to this, the fees are also very exorbitant. It means that the cryptocurrency transactions are equally high-priced to bank transactions.
All this has led to many companies not accepting cryptocurrency as payment. Another reason is that using cryptocurrency is a slow and time-consuming business because it authenticates transactions in tiny blocks. But we can solve this issue by using comparatively big blocks. Further, cryptocurrency depends on miners to authenticate transactions and recoup them with the new cryptocurrency. But soon, we will need to pay transaction fees to those miners.
There is also a popular notion that things that are suitable financial investments do not prove to be good currencies. For example, stocks, real estate, and gold make suitable long-term investments but do not work as currency because of the short-term fluctuation in their prices. Volatile goods are not worthy of payments because the customer does not know the amount they are paying for.
It is why we pay in or get paid in fiat currency. Fiat currency is reliable because its value doesn't change frequently. Hence, cryptocurrency can never be an actual currency, except for illegal transactions, where real money can't be used.
Now the question arises that will cryptocurrency be a good form of financial investment? The answer is yes. Not all of them though, some of them might be fake. But some may be quite authentic and prove to be profitable in the long run. Bitcoin, for instance, is the most popular, most prominent, and trustworthy cryptocurrency. It is, hence, not wrong to compare it to gold or call it the gold of the cryptocurrency age. Many people believe in gold and say that gold will still exist when the fiat currency collapses. Correspondingly, Bitcoin was introduced with a similar theory. Also, the value of Bitcoin, like gold, can never be zero, even if they become useless.
Also, gold has provided something like 158 percent returns since the last decade, while Bitcoin gives nearly 230 percent returns per annum. It is what is leading to people's attraction towards Bitcoin. Though gold is the most secured investment, Bitcoin can make you rich. Moreover, famous personalities and celebrities investing in Bitcoin have led to various people investing in it. Their increasing acceptance and attractive returns have lured people to choose them over gold.
Now let us discuss the advantages of investing in Bitcoin in detail. Its most attractive feature is its liquidity. Bitcoin is the most liquid financial asset because it is established globally. You can exchange Bitcoin with cash at low prices easily. If you're looking for short-term gains, Bitcoin is the best because of its high liquidity. It is also good for long-term investments because of its great demand in the market.
Bitcoin is also not affected by inflation, which is not the case with fiat currency. It is not managed by governments. But Bitcoin is different, and its value will never be zero. Also, Bitcoin is new as compared to other assets and thus has greater opportunities.
All these points prove that Bitcoin is the best among all the other cryptocurrencies. Hence, it is not wrong to call it the gold of the cryptocurrency age. Moreover, its increasing popularity might help it to replace gold and become a better financial investment. For more news about Bitcoin and other cryptocurrencies, keep reading bitcoin pro.