Whether the price of Bitcoin is up or down, the long-term future of the world’s most popular cryptocurrency is still looking bright. Here are our top 3 reasons to be bullish on Bitcoin!
Although the naysayers tend to grab the headlines, the use of Bitcoin has been increasing at a steady rate. Mainstream adoption isn’t here yet, but Bitcoin is no longer just “magical internet money” for computer nerds and other perceived outsiders.
El Salvador became the first country to make a major bet on Bitcoin in 2021, with president Nayib Bukele announcing intentions to make Bitcoin legal tender in the country.
The Swiss City of Lugano followed suit in 2022, announcing that both BTC and Tether’s USDT will become legal tender in the city, which aims to become “Europe’s crypto hub.” The City of Lugano will also mine Bitcoin using locally-sourced green energy.
Other countries are also interested in learning what Bitcoin can do for them. El Salvador recently hosted a Bitcoin conference designed especially for sovereign nations. According to a series of Tweets from president Nayib, 44 countries sent delegates to the conference, including Egypt, Pakistan, Ghana, Paraguay, and many others.
Given how many countries attended the gathering, we’re hopeful that at least a few of them ultimately decide to adopt Bitcoin. It’s prudent for nations to have an alternative financial system to fall back on so that they’re not completely at the mercy of the IMF and the US dollar.
Beyond these huge adoption stories, a growing number of places are accepting Bitcoin payments, including Paypal, Microsoft and Twitch. Many well-known celebrities, from Aaron Rodgers to Alex Barrett and Odell Beckham, are also taking their paychecks in BTC. Some companies are even paying their employees in crypto too, including almost everyone who works at Exodus!
2) Network Growth
Although Bitcoin has come under criticism for how much energy the network uses, its decentralized network of ASIC miners makes Bitcoin secure. The total computational power of these miners is referred to as “hash rate.”
Bitcoin’s hash rate is increasing steadily year on year. In fact, the network even managed to make an all-time high of 247 ExaHashes since China banned mining in the summer of 2021, and the China ban itself doesn’t seem to be as serious as once thought, with the country still running a scaled-down version of its previous mining operations.
To compromise the Bitcoin network an attacker would need to control more than half of Bitcoin’s hashrate, which would be very difficult and expensive. Difficult because it’s not easy to go out and buy hundreds of thousands of ASIC miners. A purchase that large would draw a lot of attention, and also cost billions of dollars. That’s a big investment, especially considering that if the attack were successful, and the Bitcoin network were compromised, the ASIC miners would be all but worthless afterward.
Many in the Bitcoin community used to worry that the CCP might force Chinese miners to attack the network, however, that’s no longer a concern. The public ban has increased Bitcoin’s security since the ASIC miners are now more evenly distributed worldwide. It would now be much harder for any government to successfully attack Bitcoin, which is great!
3) Authoritarianism is on the rise
Global wealth inequality is growing. While the poor stay poor because their inflation-adjusted earnings are falling, the rich are getting richer and can afford exorbitant luxuries. Quantitative easing and inflated asset markets have benefited the wealthy, while the 50% of Americans who don’t own any financial assets have been left stranded.
When populations tire of democratic systems that no longer work for them, they tend to put their faith in populist demagogues. These “strongman” leaders have a habit of ripping apart democracies and forming authoritarian dictatorships.
The future looks uncertain to many people, but Bitcoin can offer some hope. For example, the situation in Ukraine has shown the importance of Bitcoin as a vital tool to stay afloat amongst socio-economic volatility.
Ukrainians have been using Bitcoin to receive financial aid outside of interrupted banking systems and centralized crowdfunding platforms. In fact, crypto adoption is growing so fast in Ukraine that the government recently legalized all cryptocurrency in the country.
Russian citizens have been also buying Bitcoin as an alternative to the falling price of the Russian Ruble, as have Turkish citizens. The Turkish Lira is hyperinflating and Bitcoin can provide people with a way to protect their savings against devaluation. Even though the price of BTC is volatile, holding Bitcoin is still safer than holding the plummeting Lira.
In a time when even leaders in social democracies can block people from their bank accounts for supporting the wrong movements, more and more people are seeing the true value proposition of censorship-resistant money.
Last but not least, Bitcoin is referred to as “the best performing asset of the decade,” for good reason! BTC has outperformed pretty much every other asset since 2011, with cumulative gains crossing 20,000,000% last year.
Plenty of so-called financial experts in that time have declared “Bitcoin is dead” after large drops, but the little orange coin just keeps proving them wrong.
This content is for informational purposes only and is not investment advice. You should consult a qualified licensed advisor before engaging in any transaction.