Why is Bitcoin so Expensive?

08/17/2023 11:53 • Metaverse Matters • 60 views

Why is Bitcoin so expensive? Why is the price of Bitcoin so high?

From 2013 to early 2017, the price of Bitcoin fluctuated below $10,000. It wasn’t until the end of 2018 that it gradually increased in value and reached a peak of $20,000. Today, the cryptocurrency market has reached an all-time high, with a market value of over $1 billion.

So what is the use of Bitcoin? Why is it so popular?

Let’s take a look together!

What is Bitcoin? Bitcoin is digital gold, a virtual commodity, and a peer-to-peer electronic cash system. It operates and maintains a transaction platform through a decentralized computer network. Its purpose is to enable people to make payments and store value anytime, anywhere.

Simply put, when you want to buy or sell a specific type of token, this network will provide these tokens as a medium of exchange. If someone tries to use Bitcoin for payment, your network can automatically accept Bitcoin as one of the payment methods. However, because this method is called “double spending,” if you want to convert your funds into another asset, you need to first deposit the money and transfer it back to your account at another address. This is called the double-spending problem. How does Bitcoin work?

According to CoinMarketCap’s data, there are currently over 50 major exchanges providing liquidity for BTC/USDT and ETH/USDT trading pairs; in addition, some large over-the-counter trading desks have also launched BTC spot trading.

Why is Bitcoin popular?

First of all, it is the most popular form of digital fiat currency, and as time goes on, more and more people hope to hold it to gain higher profits. So we can see that many central banks have started to continuously launch their own digital dollars and legal tender to stimulate economic development.

Second, because no banking institution can guarantee that they will not charge high interest rates to anyone, Bitcoin is also very popular, especially in the United States.

Finally, although many other central banks in other countries do not consider Bitcoin as valuable, in fact, not many people can understand the value of Bitcoin. For example, the US government allows investors to invest in Bitcoin and other cryptocurrencies, or they may not even know what they are.

In summary, Bitcoin is not only a good currency tool, but also the world’s first government-issued legal tender, which means that Bitcoin now has a legal market position.

The reason why there are so many users of Bitcoin is because its value is increasingly connected to the global financial market.

Why is Bitcoin so expensive?

Why is Bitcoin so expensive? Why is it so easily accepted and used by the public?

Firstly, its security is guaranteed by a cryptocurrency-supported digital cash system. In traditional payment networks, users convert their funds into Bitcoin as a means of value storage (such as the US dollar or other legal currencies) through bank transfers or other methods. This allows traders to obtain encrypted assets at a higher price than the existing financial system. Secondly, instant settlement and automatic clearing are achieved through smart contracts, allowing millions of customers around the world to access, verify, and execute blockchain-based peer-to-peer transactions. Finally, there is a virtual currency called “Tether” that is pegged to fiat currency, which serves as a means of exchanging goods and services. These cryptocurrencies are generated through the issuance of a new token called “Tether”.

According to recent reports from Bitcoinist, Tether has successfully emerged from a basket of currencies, and many major economies including the United States, Japan, and others are adopting this technology and may even bring it into the mainstream market, such as Venezuela, but no one knows how this cryptocurrency will perform. (Cointelegraph)

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Why is Bitcoin so Expensive?

Why is Bitcoin so expensive?

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