Bitcoin, the largest traded cryptocurrency, has picked a price momentum in 2021, recording new historic levels. The digital coin price hit $34,000 at the time of writing, gaining over 77percent in the previous month and 305 percent throughout 2020. However, Bitcoin is still indicating a potential to register new records.
Launched back in 2009 as a digital currency, Bitcoin was also traded as digital money for some time in the world economy. Bitcoin has since evolved in the global financial sector as a promising digital currency. Currently, the coin is mainly being used as a sort of digital gold, implying that it’s a rare asset.
To address the pandemic’s devastating effects, most nations in the world injected large amounts of fiat money to save their local economies.
However, raising the amount of money in circulation decreases its real value. This makes citizens shield themselves from inflation by seeking alternatives as a store of value for their assets. Regarding the latest financial environment, Bitcoin has turned out as a haven in the face of impending inflation and weak performance of significant assets categories.
Overview of Bitcoin
Bitcoin is the most dominant cryptocurrency in terms of market share and has a supply cap of 21 million. The cap is encrypted into the Bitcoin protocol, and it is impossible to manipulate. This causes a scarcity, which implies that the digital coin could gain in value in due course.
While state-issued fiat currencies such as British Pound and the Us dollar may see their total supply raised at the discretion of the local central banks, Bitcoin supply is set and free from politically driven inflation.
Why is Bitcoin leading the Crypto race?
There are several reasons why the digital coin has attracted global attention.
1. Bitcoin is a reliable asset
Following the latest economic turmoil, trading and holding Bitcoin has become the new norm for many people seeking options to protect their assets from the weakening fiat currencies. The economic potential of Bitcoin is almost similar to that of gold that shines in tough times.
In the thick of a pandemic, tensed US presidential transition, and the geopolitics change, it’s quite arguable that many investors consider Bitcoin and gold as superior options to the US dollar.
2.Bitcoin links up with privacy-driven ideologies
The digital asset and mainly the cryptocurrency concept is not ideally or politically nonpartisan. Bitcoin was conceived during the internet age, which was troubled with privacy challenges.
Bitcoin ideologies are rooted in the cypherpunk movement back in the 1990s and the beginning of 2000. Several records online indicate that Bitcoin was suggested as an obscure digital currency, enabling people to engage online without government interference and providing an option to various investors with a different view of the current financial system.
What is propelling the Bitcoin Surge?
Well, the current price momentum of Bitcoin boils down to the integration of many aspects such as ideology, social views, and expectations.
However, these aspects are ever-changing, but this does not degrade the digital asset’s potential considering the latest institutional propelled demand for Bitcoin around the world.
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