If money can be trusted to maintain its relative value over time, it can be used as an investment tool. Throughout history, precious metals have been used as an investment tool in many societies. These metals have been shown to have a relatively stable value. However, instead of requiring individuals to carry large amounts of cocoa beans, gold, or other forms of currency, the investment vehicle was alternatively converted to minted currency. Yet many examples of minted currency were usable because they were reliable shelf storages, made of metals with long shelf lives and little risk of depreciation. However, after a while, this started to be insufficient for individuals because there were non-cash uses. Innovative as it is not possible to pay with currencies without an intermediary and is the first cryptocurrency as the currency of the future.
The foundations of Bitcoin
were laid.
Bitcoin offers an efficient way to transfer money over the internet and is controlled by a decentralized network with a transparent set of rules. Thus, it offers an alternative to fiat money controlled by central banks. We can see fiat coins or any valuable asset as an investment. Bitcoin and other
cryptocurrencies
also have several advantages to using as an investment tool. If we briefly touch on these advantages;
1. Authenticity
There is no fraud in Bitcoin that would be possible in investment vehicles such as gold. You can check it online from anywhere. Since Bitcoin relies on public key cryptography and one-way hash functions that are impossible to break, it cannot be counterfeited.
2. Severability
Bitcoin , which is a piece of code, can be broken down into very small parts. Instead of 1 BTC, you can also get 0.000001 BTC. This is not the case when investing in gold or other precious metals.
3. Portability
No matter how much the value of Bitcoin increases, the wallet weight will always be the same. Since it is a physically worthless investment instrument, it has no weight except for hardware to store your wallet information. This is much more advantageous than cash or other investment instruments. It’s 0 grams if it’s on your phone, or a few grams in a special hardware wallet like Trezor.
4. Storage Cost
When you want to store your Bitcoins in a cold wallet, choosing the right device for this can be quite reliable and convenient. It does not have expenses like a bank. A low-cost wallet will do you all .
5. Transaction Cost
Every physical product will always be more costly than a digital product. Despite the high dollar value of Bitcoin, it is practical and efficient compared to all other investment vehicles thanks to its low transaction fee, high divisibility.
6. Predictable Supply
Bitcoin’s distribution and maximum supply is a well-known fact. Only 21,000,000 BTC will be generated, and this limit is guaranteed by consensus rules, which are impossible to change.
Considering these details; The nominal price of Bitcoin will be used as a valuable investment tool day by day thanks to its market capitalization and advantage.
