Is Bitcoin Here to Stay, or Just a Fad? • Benzinga Crypto


    Decided BTC is a good investment? You can get BTC on eToro today.

    Bitcoin is the first cryptocurrency of its kind and widely referred to as the flagship coin of the cryptocurrency space. For this reason, all other cryptocurrencies are collectively referred to as altcoins. 

    However, as the convergence between the digital and physical world continues to unfold, more cryptocurrencies and types of digital assets are emerging. The following discussion will investigate if Bitcoin can survive in the long run and stay relevant as the cryptocurrency industry continues to evolve. 

    Is Bitcoin Here to Stay or Just a Fad?

    The cornerstone narrative in the cryptocurrency community is the provision of decentralized financial (DeFi) systems. In terms of this narrative, Bitcoin is the undisputed gold standard. Bitcoin is a new financial system that can’t be controlled or manipulated by politics or human greed — a fair and transparent money for a divided world. It isn’t designed for buying coffee; it’s designed to be the next global reserve currency. 

    In technical terms, Bitcoin is the most decentralized cryptocurrency in the world, and the largest cryptocurrency by market capitalization. Moreover, Bitcoin is the only leading cryptocurrency that has an anonymous creator, had pure organic growth and been tested multiple times, which has resulted in it being the most meritocratic cryptocurrency on the market.

    In short, Bitcoin is extremely unique. The biggest difference with Bitcoin and other cryptocurrencies is what Bitcoin stands for in terms of shifting the power away from a few to as many people as possible.

    What Is Bitcoin?

    Bitcoin is a Layer 1 blockchain, a type of project that represents the base network or underlying infrastructure in a blockchain-based financial system. Layer 1 blockchains can finalize and validate transactions without the help of another network. They also have their own native token, which is used to pay for transaction fees. 

    Bitcoin is a form of digital currency and used by many as a speculative store of value. It is decentralized, meaning that no central authority controls it. Instead, Bitcoin is run by thousands of computers distributed around the world. Despite not being accepted as legal tender in most of the world, Bitcoin is popular because it can’t be censored, has a finite supply of 21 million and allows transactions to be made by anyone, at any time and from anywhere.

    Like most cryptocurrencies, Bitcoin is supported by a technology known as a blockchain — a decentralized, distributed ledger that records the provenance of a digital asset. The blockchain secures cryptocurrency transactions by creating incentives to make tampering unprofitable for malicious users. The implication is that ownership of crypto is held probabilistically through trustless enforcement, as opposed to certainty. 

    From an investment standpoint, the closest thing that Bitcoin can be compared to is digital gold. Bitcoin can be considered as a speculative super commodity, with a value proposition based on it being a perfectly scarce, portable, immutable and divisible savings technology. 

    These factors mean that Bitcoin can stay largely unaffected by factors that could affect its value such as  inflation, seigniorage and failing monetary policy. Bitcoin does not rely on a central bank; instead, it is managed by programmed algorithms that are governed in a decentralized and democratic manner. 

    BTC History

    Bitcoin was developed out of the turmoil of the 2008 Great Recession as distrust of centralized financial institutions grew. An individual or group of people going by the name Satoshi Nakamoto issued a whitepaper to address the centralized control of money and the required trust that citizens place in the hands of centralized authorities.

    The purpose of Bitcoin was to bypass the middleman in financial transactions, reducing costs,  improving efficiency and increasing financial accessibility.

    On January 3, 2009, the Bitcoin blockchain was launched when the first block, widely referred to as the genesis block, was mined. For the first few months, Bitcoin had no real monetary value. However, about a year later, the first economic transaction took place when a man from Florida negotiated to have two Papa John’s pizzas, valued at $25, delivered for 10,000 Bitcoin on May 22, 2010. This act established the first initial real-world price of Bitcoin (BTC) at 4 Bitcoins per cent.

    Fast forward today, and that amount of Bitcoin is valued at nearly $400 million. This iconic day is referred to as Bitcoin Pizza Day (May 22) by cryptocurrency fans all over the world. Since first becoming available on exchanges in 2010, BTC is now listed on over 600 exchanges worldwide. 

    Pros and Cons of Bitcoin

    Despite Bitcoin’s sterling reputation in the cryptocurrency space, Bitcoin too shares its mix of strengths and weaknesses compared to other cryptocurrencies.

    Pros

    • Most decentralized cryptocurrency
    • Strong reputation, concrete aim and global recognition
    • Higher level of trust and stability than many other cryptocurrencies

    Cons

    • Proof-of-work (PoW) mining process not eco-friendly
    • Serious scalability issues

    BTC Competition

    As a Layer 1 blockchain, Bitcoin’s biggest competitors are other Layer 1 blockchains such as Ethereum. All competitors aim to solve the blockchain trilemma (scalability, security and decentralization) more effectively than Bitcoin. Nonetheless, while Bitcoin is the most decentralized blockchain, Bitcoin is easily surpassed by competitors in terms of functionality and scalability.

    Bitcoin’s biggest competitor is Ethereum, the second biggest cryptocurrency by market capitalization. You can think of Ethereum as a public shared global computer network. It doesn’t run on a single device but instead runs simultaneously on thousands of devices around the world. People around the globe contribute their computer’s computing power to the network and are paid for doing so. 

    Unlike Bitcoin, the Ethereum blockchain enables developers to create and launch decentralized applications (dApps) and is faster than Bitcoin. This goal is achieved by using smart contracts, allowing users to interact and develop dApps that cannot be censored or shut down. For this reason, Ethereum is commonly referred to as a decentralized computing platform or a decentralized internet. 

    In addition to Ethereum, other competitors include Solana, Cardano and Polkadot, all of which aim to differentiate from other Layer 1s by addressing the blockchain dilemma in a more effective manner. 

    How to Make Money With Bitcoin

    Aside from buying BTC at one price and selling at a higher price, you can make money with BTC through interest-earning platforms such as Coinbase.

    However, it is important to note that you cannot earn BTC from staking because Bitcoin doesn’t use a proof-of-stake (PoS) consensus mechanism like Layer 1 blockchains such as Ethereum or Cardano. 

    How to Buy Bitcoin (BTC)


    get started

    securely through eToro’s
    website

    Disclosure: eToro USA LLC; Investments are subject to market risk, including the possible loss of principal.

    1 Minute Review

    eToro, headquartered in Cyprus, England and Israel, has provided forex products and other CFD derivatives to retail clients since 2007. A major eToro plus is its social trading operations, including OpenBook, which allows new clients to copy trade the platform’s best performers. Its social trading features are top notch, but eToro loses points for its lack of tradable currency pairs and underwhelming research and customer service features

    Best For

    • U.S. based cryptocurrency traders
    • Investors looking to CopyTrade other traders
    • Simple user interface
    Pros

    • Several major cryptocurrencies and altcoins
    • Expansive network of social trading features
    • Large client base for new traders to imitate

    BTC can be traded on major exchanges such as Coinbase Global Inc. (NASDAQ: COIN), Gemini, Crypto.com and eToro. Many of these platforms allow you to purchase Bitcoin using your credit card, through swapping features or through different trading pairs such as BTC/USDT. 

    Is Bitcoin Here to Stay?

    Bottom line, Bitcoin is the longest-standing cryptocurrency, with an untouchable value proposition and fundamentals that suggest that it is the most meritocratic cryptocurrency in the world. Moreover, Bitcoin has a unique network effect from being the first cryptocurrency created of its kind, making it less susceptible to being easily replaced and the first point of contact newbies have with the cryptocurrency industry.

    To reiterate, all other cryptocurrencies are called altcoins, and for good reason. Bitcoin is truly one of a kind, and is the epitome of what the cryptocurrency movement stands for.



    Source link

    Previous articleApple’s gothic “The Essex Serpent” needs more bite, despite Claire Danes and Tom Hiddleston
    Next articleIs Spell Token (SPELL) Trending Lower or Higher Saturday?