Is Bitcoin Back?

100%.

That’s how much the price of bitcoin increased since December 31. At last check, the cryptocurrency was trading at $7,502, after jumping 14% on Friday and 7% on Monday. For non-mathematicians, that’s more than 20% in just a couple of days. Not bad.

So, are cryptos back?

If you’re looking for an investment with zero assets, no home turf, no management, and a side of adrenaline rush, then this is your baby. But if you want stability, as most people do with their currency, then take a pass.

And that’s the problem with bitcoin. It’s not stable and not used for many transactions. Other than that, it’s a perfectly acceptable currency!

As for why it’s going up, there are a couple of reasons, one internal and one external…

On the inside…

Bitcoin is headed for another “halvening”, which is the time when bitcoin miners earn half as much for their efforts because the algorithm controlling the cryptocurrency will reduce the amount of bitcoin created by 50%.

Without getting too far into the weeds, miners verify all transactions on the blockchain and then add a small block of verified transactions to the blockchain. The entire process is computer intensive and uses a lot of power, so miners are paid in bitcoin. The controlling algorithm determines the rate of pay, and it drops by 50% about every four years.

By consistently lowering the number of coins created, the system is trying to maintain or even increase the value of bitcoin. If demand and use are growing faster than supply, then the price should go up, making everything purchased with bitcoin comparatively cheaper.

The next halvening will occur in May 2020, which seems like a long way off, but it’s possible that bitcoin investors are starting to build positions in front of that date.

On the outside…

We’ve got trouble in Venezuela, Iran, and now Argentina, all of which can drive bitcoin higher.

1 2 3
View single page >> |
How did you like this article? Let us know so we can better customize your reading experience. Users' ratings are only visible to themselves.

Comments

Leave a comment to automatically be entered into our contest to win a free Echo Show.
Sasha Smith 6 months ago Member's comment

Please continue this great work and I look forward to more of your awesome blog posts.

https://kriptomat.io/litecoin-ltc-price/