Understanding Bitcoin's Value in 2022By David Thompson, UniversityHerald Reporter
This digital money is one of the most traded and popular cryptocurrencies, and many experts believe it is the absolute future of money. Despite Bitcoin being extremely volatile, it is a perfect investment for long-term investors who believe that its value will increase over time.
There are a few factors that influence the value of this electronic money. Bitcoin has a hard limit of 21 million Bitcoins. As a result, only 21 million Bitcoins will ever exist. The limited supply of Bitcoin increases leads to a rise in demand for this digital Hul money. In the end, demand and supply are the main factors that drive the value of Bitcoin. So, if you are trying to understand this digital currency's worth, here is a complete guide. If you are interested in trading Bitcoin, you may consider using a reliable trading platform like bitalpha-ai.io
Ease of Using Bitcoin
People can use Bitcoin as a value store and exchange medium. What's more, this digital currency has gained global attention as a perfect means of transacting, and at the same time, it is a new asset class.
The public is not only limited to using this virtual currency as a payment method but is also allowed to convert their fiat currency into Bitcoin. Many people believe this virtual currency is a perfect hedge against inflation hence why it is a better store of value.
There are lots of platforms that have emerged to help people invest in this virtual currency easily. Therefore, this electronic currency is becoming more accessible to the public, and more investors want a share of the asset class and are willing to pay more.
This digital money has a hard limit cap of 21 million Bitcoins. As of now, around 19 million Bitcoins are already circulating. The scarcity of this digital currency translates to an increased demand for this virtual money because the supply is limited. The limited supply of this electronic currency is why many find Bitcoin an ideal store of value and consider it as a hedge against inflation. Therefore, if the collection of this electronic asset never increases, the price increases if demand continues to grow.
Mainstream and Global Adoption
The bitcoin adoption rate among public and private corporations has contributed to the increase in its price. Business owners globally are now accepting Bitcoin payments. El Salvador and the Central African Republic have legalized this digital money in their country. More so, established businesses such as Microsoft, PayPal, and Starbucks have incorporated this virtual currency into their operations.
The increased adoption rate of this virtual currency has increased the price of this electronic currency. The audience of this virtual currency has become wider due to increased adoption. Halving
Bitcoin undergoes halving, a process by which the rewards given to miners are cut by half every time they add 210,000 blocks to the blockchain. The halving process happens every four years, meaning that the rate of 9inflation of this digital money is cut by half every four years. Therefore, as much as the demand for this electronic currency remains constant, its price will increase.
The factors listed in this article significantly influence this digital currency's value. As a result, the value of Bitcoin in 2022 cannot be rightfully determined. However, there are higher chances of price increases after the next halving event. Nevertheless, take your time to investigate this cryptocurrency and other factors that may affect its value before investing.