Many people didn’t think too much about Bitcoin until 2017 when it was exploding to new heights. It was difficult to not get wrapped up in the hype. After all, there were a lot of Youtube celebrities showing off their Lambos that they bought with the profits from their bitcoin investments.
But, then the crash happened. Almost overnight in early 2018 the price dropped almost 80%. And that’s when people gave up on the idea of Bitcoin as a viable currency and didn’t think any further about it.
Was it wise to move on and think more traditionally? Or, was it wrong and short sighted to write off bitcoin as a fad that had no real value after all?
Now that Bitcoin has hit record highs, it pays to take another look and see if it is a good idea to start thinking about it again.
Once the crash happened not only did people start to question whether it was a good idea to continue to support the cryptocurrency, but they also wondered is Bitcoin legal. Some countries decided to ban trading of the cryptocurrency and some people turned their backs on it even if it remained legal.
Then, bitcoin went into a bit of a hibernation period. It slowly crawled its way back in price, but it never reached the fever pitch that it previously had attained in 2017. Then, in 2020, the pandemic hit and suddenly people tok a much different view of the possibilities of bitcoin.
Benefits of investing in bitcoin
One of the problems caused by the pandemic was that the economy went into a major downturn. To keep things going, many governments started printing money like crazy. As a result, inflation went wild.
Since there is a limited amount of Bitcoin, there can never be a case of inflation. So many saw it as a good way to keep their money safe. And the value rose again. Then Paypal announced that you could start using their app to buy bitcoin and it started to get adopted by the masses. Which in turn caused the value to rise further. Now you have a situation in which you can protect your money from inflation and use the cryptocurrency as an actual currency that retains its value. And not only that, but if you are buying in to protect your money and the price continues to rise you will also make a tidy profit.
If you’re still unsure of whether or not to believe the Bitcoin hype, then start out by buying small amounts that you can afford to lose. This way you can see if it is worth the risk to invest. Since any investment is a risk you need to weigh the pros and cons of investing in bitcoin.
*This article has been contributed on behalf of Paxful. However, the information provided herein is not and is not intended to be, investment, financial, or other advice.