Why Bitcoin is Valuable

Bitcoin is a cryptocurrency that I believe is one of the greatest investments that one can make. Only time will tell if I am right or not, but in this article, I want to explain my theory on why Bitcoin is and will keep being valuable. My hope is that someone reading this will disagree with me and tell me why in the comments below because I hope that we can start a discussion on this topic, but for now, I will do my part and provide my reasons on why Bitcoin is valuable.

1. It accomplishes something amazing. Many people who are opposed to Bitcoin say that they don't believe in it because it doesn't actually do anything. I think that this could not be further from the truth. Bitcoin gives people the ability to transfer wealth all around the world without a third party. Imagine if one needed to transfer money to someone in a foreign country. How would they do it? Well, one could send a bank transfer assuming they do it when the banks are actually open because they are not open 24/7. They could use a service like PayPal although international transfers with PayPal are not free and those fees can end up being a large expense over time. If one wanted to avoid all of that, they could just transfer Bitcoin from their wallet to the other persons. This is one of the reasons that Bitcoin is so valuable. It accomplishes a need.

2. It works as a currency in a way where other things can't. Some of the biggest critics of Bitcoin are the supporters of precious metals like Gold or Silver. These things will never work as a currency in the way that Bitcoin does. Bitcoin is easy to verify as authentic while precious metals are not. Also, even our current currency faces limitations that Bitcoin doesn't. If I travel to a foreign country, I have to exchange my money for the other countries money. This causes problems because when I shop at other countries, I have to convert each item to my dollars to know how much of my money I am actually losing when at the end of the trip I retransfer back to my own money. It's difficult. Bitcoin would fix that. As Bitcoin becomes legal tender in more and more countries, I will now be able to go to a foreign country and instead of converting my money, I would just use my Bitcoin. This is another value that Bitcoin possesses. Also, imagine if one owns a business. If someone pays at the business by check, they must wait for the bank to clear said check. If one pays by card, they must also wait for the funds. With Bitcoin's lightning network, they see the money essentially instantly. Bitcoin has also been a currency that has seen a large increase in value since its creation. This is important. Since our current currency faces constant devaluation, it gives people an incentive to not have it. Why would one want something that will lose them buying power over a long period of time? Bitcoin has historically increased in value which gives people the incentive to want Bitcoin.

3. Bitcoin is scarce. There are 21 million Bitcoins in existence. It is impossible for anymore Bitcoin to ever exist. Scarcity alone isn't value, but since Bitcoin already accomplishes a need, the scarce element of Bitcoin provides huge value. With huge demand and very limited supply, it makes sense that Bitcoin would keep becoming more and more valuable because people will be willing to spend more and more money to have it. If one agrees with my first two points and believes that demand for Bitcoin will grow, then one must also agree that the scare supply of Bitcoin will create more value. 

These are three reasons why I believe that Bitcoin is valuable and will remain valuable. If one disagrees with me, I would love to hear why in the comments below.

Follow @financebycwt on social media.