Few technologies can transcend this global reach and leverage the power of blockchain technology. One such technology is Bitcoin, with its innovative underlying blockchain design. The widespread adoption of cryptocurrencies through bitcoin has led to the proliferation of related technologies like smart contracts, oracles, and cryptocurrency exchanges. If you are curious about crypto, check out how we can achieve long-term gains while surviving the crypto.
This trend has been steadily rising over the last five years in line with bitcoin’s increasing adoption rate as more international banks and financial institutions embrace it as a reliable means of payment. Interest in cryptocurrency is not just limited to enthusiasts; investors have flocked to view crypto as a viable investment opportunity over traditional stores of value like gold or stocks. There are several reasons for this interest from various parties — from a low supply of available coins to the possibility of significant returns via volatile price movements.
For many, that volatility is part of the appeal, as it’s an attractive asset that’s quite different from stocks or bonds. However, Bitcoin isn’t a single cryptocurrency and is split up into several parts called “coins,” whose value revolves around each coin’s unique features and purpose.
As with any new technology like blockchain, some praise the technology while others criticize it on several technical or theoretical grounds. Because Bitcoin and blockchain technology apply to a wide range of industries, the below-mentioned portion will deal with some of the biggest reasons behind the increasing credibility of bitcoin and blockchain.
Mass adoption:
Bitcoin has been steadily growing in popularity since its creation, with the first transaction happening in 2009. This growth is guaranteed to continue as Bitcoin is accepted by more big retailers and small businesses every day. In addition, Bitcoin has profoundly impacted the value of its currency, making it a lucrative investment option for many interested in online trading.
The subjective nature of virtual money
Where the value of traditional money is based on the objective status of a country’s economy, the value of cryptocurrencies is subjective. The value of a cryptocurrency is not tied up to any single object; instead, it’s potential as something that people can exchange for other goods and services.
Price volatility can be a challenge for most investors in the long term. There are times when Bitcoin drops drastically in terms of value, but there are also times when it rises sharply. This price volatility also leads to Bitcoin having quite a high return on investment (ROI) which makes it attractive to many traders.
Benefits to merchants and consumers:
The concept of Bitcoin being used as an actual currency is still pioneering. It may take a few years before it can be universally accepted as a medium of exchange. Still, businesses can buy cryptocurrencies and expect to be paid in conventional currencies. In addition, cryptocurrencies don’t have transaction costs or minimum amounts and are more secure than standard bank accounts, which can be hacked. Also, blockchain technology may help in the long term to eliminate counterfeit products, but it is currently quite expensive.
Increase in popularity and adopters:
The number of Bitcoin users has also been growing over the years. It still needs to be clarified what influence this price fall will have on future market growth, but the fact remains that more people are using BTC for their money transfers and other financial transactions.
Real estate projects are turning to blockchain technology for greater transparency on critical records such as deeds and financial transactions. While there are still several concerns about cryptocurrency, such as its security, people are looking for more radical ways to protect their money and investments.
The development of blockchain technology provides a convenient method for financial transactions because it offers an efficient and secure way to store data electronically. It also ensures no fraud or theft because the data cannot be edited or removed once entered into the blockchain. Blockchain technology is currently used by many industries like banking, insurance, healthcare, telecommunications, etc.
Government authorities supporting blockchain:
The U.S. federal government has also taken a more proactive approach to Bitcoin and blockchain technology. For example, last year, the U.S. Internal Revenue Service (IRS) released a legal notice announcing that Bitcoin is treated as property for tax purposes, so it should be reported as capital gain or loss when reporting one’s annual income.
The IRS has been “working towards guidance on how to treat bitcoin and other virtual currencies in light of their use, but they have not yet issued such guidance .”Over the years, Bank of America and JP Morgan have joined to create Blockchain technology-based solutions to facilitate international transactions.
