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As of March 2021, the cryptocurrency market is worth around US$1.7 trillion, out of which US$1 trillion is Bitcoin alone. Bitcoin is still so dominant that all altcoins’ collective price action continues to depend on Bitcoin largely. Its value has been increasing since its inception; it has made many millionaires and even Billionaires in the past decade. It seems that Bitcoin’s value will keep on increasing in the foreseeable future.
This begs the question – why is Bitcoin’s value on the rise, and how to buy Bitcoins in India?
#1 The tech that Bitcoin delivers
Blockchain was first presented to the world in the 90s, but it didn’t gain much traction at that time. Bitcoin was the first successful implementation of the technology. The idea of a trustless and privacy-centric payment system is quite intriguing.
Bitcoin was followed by thousands of other cryptocurrencies, which either aimed to improve Bitcoin’s technology. This mass adaption was one of the biggest reasons for an increase in Bitcoin’s value.
#2 Deflationary tokenomics
Bitcoin’s value is always on the rise, not just because of its tech; tokenomics is also equally responsible. Tokenomics is a study of understanding the supply and demand model of a cryptocurrency. Bitcoin has a deflationary model of tokenomics; this means it will reduce the supply with time.
After every 210,000 blocks of the Bitcoin blockchain has been mined, Bitcoin reduces its supply by 50%. In the early days of Bitcoin, the mining rewards of one block of Bitcoin was 50 BTC, which was reduced to 25 in 2012 and 12.5 in 2016. After the third Bitcoin halving, in 2020, the mining reward is 6.5 Bitcoin. This mining algorithm will go on until all 21 million Bitcoins have been mined, effectively increasing Bitcoin’s value over time.
#3 A good hedge against a bear market
Experts around the world are anticipating a major crash in the stock markets. Gold is also entering a bear market; more and more companies are investing in Bitcoin to hedge against the stock market. Companies like Tesla and MicroStrategy have invested billions of dollars in Bitcoins, promotion mass adoption, and Bitcoin’s value.
#4 Not just “dark money”
Imagine going to burger king and paying in Bitcoin or buying the new Halo game for your Xbox in Bitcoins. All this can be done since multiple top-tier companies now accept Bitcoin as a legitimate payment option. You can even recharge with Bitcoins; if you are in New Zealand, you can get paid in Bitcoins. All this is showing how the world is evolving and understanding that Bitcoin is more than just “dark money” or a “bubble,” this day to day use of Bitcoin is also contributing to its value.
#5 Layer 2 solutions
Bitcoin is the first of the cryptocurrencies. Hence it is not perfect; there are many flaws in the system, the biggest being the transaction speed is slow. It takes around 10 mins for a Bitcoin transaction to take place; on the other hand, Visa or MasterCard can process fiat transactions in seconds.
This slow transaction speed could be a challenge since it makes Bitcoins virtually useless in the type of transactions mentioned above. It’s why many Layer-2 solutions were thus introduced by the community, like the Ethereum Plasma network and Bitcoin Lightning Network. With these layer 2 solutions, users can withdraw or send Bitcoins and complete the transaction in some seconds and decrease the fees, effectively increasing local adoption and increasing Bitcoin’s value. Expect this trend to continue as innovations continue to push for more mass adoption.
Bitcoin’s adoption increases its value, but to increase adoption in countries like India, exchanges like WazirX, which introduced a fiat pair to buy Bitcoin in India, also played a major role. Introducing a fiat pair (BTC/INR) facilitates users to buy Bitcoins in India with INR, which is way more convenient and cost-effective than buying Bitcoin or any other cryptocurrencies with foreign currency.
There have been several predictions on Bitcoin’s price already. We’ve even covered the top 5 Bitcoin price predictions for 2021 in a separate post. And Bitcoin’s hype isn’t just driving up its own price. It’s causing ridiculously high price predictions for Ethereum as well – as much as $5000 in 2021! Certainly, a great time to be in the market, don’t you think?
Further Reading:
Bitcoin Cash Price Prediction: How much is it worth in 2021?
Ethereum price prediction: Will it hit $5000 in 2021?
5 Critical Bitcoin Price Prediction For 2021
Digibyte Price Prediction : What’s in store for us?
TRON Price Prediction: How much is it worth in 2021?
Zilliqa Price Prediction: How will it perform in 2021?
Ethereum price prediction: Will it hit $5000 in 2021?
5 Critical Bitcoin Price Prediction For 2021
Disclaimer:
The price prediction is based on data collected from various sources. This is not an investment advice. Crypto investing is high risk activity, and User should do their own research, including obtaining appropriate professional advice before taking any investment decision.
Frequently Asked Questions
What Is The Meaning Of Bitcoin?
Bitcoin is a type of cryptocurrency that was first introduced in January 2009. It is invented based on the key concepts and notions presented in a whitepaper by Satoshi Nakamoto, a mysterious and pseudonymous figure. The name of the individual or people who invented technology is yet unknown. Bitcoin promises reduced transaction fees than existing online payment methods, and a decentralized authority controls it, unlike government-issued currencies.
What Is Meant By Bitcoin?
Bitcoin is a digital currency that was initially released in January 2009. It is based on ideas offered by Satoshi Nakamoto, a mysterious and pseudonymous figure, in a whitepaper. The name of the person or individuals who invented technology has not been revealed. Bitcoin promises lower transaction fees than other online payment systems, and unlike government-issued currencies, it is decentralized.
How Many Bitcoins Will Ever Be Created?
The source code of Bitcoin stipulates that it must have a restricted and finite quantity. As a result, only 21 million Bitcoins will ever be generated. These Bitcoins are added to the Bitcoin supply at a predetermined rate of one block every ten minutes on average. The supply of Bitcoins will be depleted once miners have unlocked this number of Bitcoins. It's possible, however, that the protocol for Bitcoin will be altered to allow for a higher supply.
How Many Bitcoins Are There?
There are 18,730,931.25 Bitcoins in circulation as of June 2021. The total number of Bitcoins that would ever be there is just 21 million. On average, 144 blocks are mined every day, with 6.25 Bitcoins per block. The average number of new Bitcoins mined every day is 900, calculated by multiplying 144 by 6.25.
What Is Bitcoin Used For?
Bitcoin was created as a means of sending money over the internet. The digital currency was designed to be a non-centralized alternative payment system that could be used in the same way as traditional currencies. Bitcoin is being used by an increasing number of businesses and individuals. This includes establishments such as restaurants, apartments, and law firms.
How Can I Convert Bitcoins To Cash?
Bitcoin may be converted to cash in various ways, including crypto exchanges, Bitcoin ATMs, Bitcoin Debit Cards, and Peer to Peer Transactions. You may do this by using Bitcoin exchanges like WazirX. You may also sell Bitcoin for cash faster and more anonymously through a peer-to-peer marketplace.
What Type Of Currency Is Bitcoin?
Bitcoin is a type of digital currency or cryptocurrency. In January 2009, Bitcoin was established. It's based on Satoshi Nakamoto's ideas, which he laid out in a whitepaper. The name of the individual or people who invented the technology remains unknown.
Is Bitcoin Safe And Legal In India?
In 2020, the Supreme Court of India lifted the RBI’s restrictions on cryptocurrencies. According to the Supreme Court, the existence of Bitcoin or another cryptocurrency is unregulated but not unlawful. The verdict has greatly aided the world of digital money in the country. To put it another way, investing in Bitcoin is perfectly legal, and you may do so through various apps and traders.
Is Bitcoin Mining Free?
Bitcoin mining isn't free, but it can be tried on a budget. Bitcoin mining is an essential part of the blockchain ledger's upkeep and development and the act of issuing new Bitcoins. It is accomplished by the use of cutting-edge computers that tackle complicated computational arithmetic problems. The effort of auditor miners is rewarded. They're in charge of ensuring that Bitcoin transactions go off without a fuss and that they're legal.
What Is Bitcoin?
Bitcoin is a decentralized digital currency that may be purchased, traded, and traded without intermediary like a bank. Bitcoin is built on the blockchain, which is a distributed digital ledger. Wei Dai suggested a new kind of money that relies on cryptography rather than a central authority to oversee its production and transactions on the cypherpunks mailing list in 1998. Bitcoin was the first application of that notion. In 2009, Satoshi Nakamoto sent out the first Bitcoin specification and proof of concept to a cryptography mailing group.
Disclaimer: Cryptocurrency is not a legal tender and is currently unregulated. Kindly ensure that you undertake sufficient risk assessment when trading cryptocurrencies as they are often subject to high price volatility. The information provided in this section doesn't represent any investment advice or WazirX's official position. WazirX reserves the right in its sole discretion to amend or change this blog post at any time and for any reasons without prior notice.
