Therefore, the main question that arises now is: is 2020 the right time to buy Bitcoin? Many reliable sites, like bitcoin revolution, have published extensive articles on this topic, and it seems that certain factors must be considered to answer this question. Let’s take a look at these factors to try to answer the question.
– Lots of Options Available – Since the moment Bitcoin was launched in 2009, many new cryptocurrencies have also entered the market, which has helped many people and investors to invest their money in them. Cryptocurrencies like Litecoin, Etherium, etc. also have their share of the market, but Bitcoin is still the favorite among the masses as it was the world’s first virtual currency and its prices have been higher than the rest. Furthermore, the media coverage that Bitcoin has received in all these years was far greater than that of all other virtual currencies combined. This factor has also contributed greatly to the increase in their prices.
– Quantitative easing – In 2020, following the situation with COVID-19, the US Federal Reserve dug deep into its savings and introduced quantitative easing. This led some investors to place their investments in Bitcoin, so that they could protect their funds against any potential devaluation of the dollar that could occur from quantitative easing. Some experts believe that since there is a limited number of bitcoins on the market, BTC may not be susceptible to devaluation. However, the number of new BTC that are being mined is always decreasing. Therefore, increased demand and decreased supply could increase the value of BTC, which is also a basic principle of supply and demand.
– Blow to traditional investments – Traditional investment instruments, such as stocks and shares, have been seriously impacted in 2020 due to the “black swan” of the coronavirus. The transaction volumes of these instruments have been significantly impacted, which is why many investors are turning to cryptocurrencies despite their substantial volatility. But, so far, the volatility of the virtual currency has not been so much this year, and it is expected to remain stable throughout this year and the next, due to many associated factors.
In addition, investors who trade traditional investment sources are becoming more and more comfortable with Bitcoin, and all that this currency offers them. It can be a very good start for these investors, as well as for the cryptocurrency to gain more acceptance and recognition.
– Bitcoin split – In May 2020 the “Bitcoin split” took place, through which the number of available bitcoins was reduced to half what was available before. That effectively means less supply, and with COVID-19 still affecting the world, demand is sure to go up. The ‘Bitcoin split’ has also helped the price of BTC appreciate, and after 2017, 2020 is the year the cryptocurrency has seen its highest prices. However, industry participants maintain that the BTC boom will last for a few more years, and the current rise is just the beginning of that event. Some informed optimists of BTC have even ensured that the coin will reach the million mark within two to three years from 2020. If that happens, even partially, it would mean that the price of BTC will be between five and six times. greater than the current one.
Hence, after considering all these factors, it certainly seems like the right time to invest in cryptocurrency, even if the current rate is believed to have reached its highest possible point. However, as an investor, it may be the best bet, as BTC may be the best long-term asset.