Bitcoin is the cryptocurrency with better performance since blockchain tokens began their travesty.
Of all crypto assets, Bitcoin is the face of digital currency that serves as an alternative to central bank control.
Certain people believe that the value of Bitcoin is similar to precious metals.
Indeed, they have similarities. Precious metals and crypto assets have a limited quantity and have specific roles.
People use precious metals in industrial applications. However, Bitcoin serves as a medium for retail transactions and could be more useful in the future.
“Bitcoin demonstrates some attributes of a currency, but its main source of value lies in its restricted supply and increasing demand,” says John Kelleher, a blockchain software architect and founder of Level K.
“If the price of one bitcoin were to reach $514,000, Bitcoin’s market capitalization would reach approximately 15% of the global currency market.”
Where’s the value in Bitcoin and other digital currencies?
Money moved from physical attributes onto more functional characteristics.
Bitcoin doesn’t need government authorities or an intermediary bank for using it.
“The only way that one would be able to create a counterfeit bitcoin would be by executing what is known as a double-spend,” Kelleher published.
“This refers to a situation in which a user “spends” or transfers the same bitcoin in two or more separate settings, effectively creating a duplicate record.”
Bitcoin’s source of value is scarcity.
Similar to gold, crypto investors trade the limited supply and obtain an increasing profit.
Plus, the blockchain is not expensive, and it is effective when a user wants to trade Bitcoin.
“Bitcoin’s underlying technology, called blockchain, is tested and used as a payment system,” Kelleher mentioned.
“One of its most effective use cases is in remittances across borders to bump up speed and drive down costs.”