Cryptocurrency is a digital currency that is highly secured by cryptography. Cryptography is a method of converting plain text to ciphertext. Now there are numerous categories of cryptocurrencies that are being used for transactions in the cryptocurrency market. Now Bitcoin is one of the popular virtual currencies which is widely used by today’s youth to earn profit from the investment.

While there are 8000 cryptocurrencies in the market, the question is why Bitcoin is valued so high. The first reason is that it is the pioneering digital currency, and secondly there is a limited value to it. There was a time when Bitcoin’s value was pegged at $1 and now its in thousands of dollar.

What is Bitcoin?

Bitcoin is digital currency that works on peer-to-peer technology. All the transactions of bitcoin are maintained on the ledger, and this work is done by bitcoin miners. This whole process is termed ‘Bitcoin mining’. Since bitcoin is the largest and oldest cryptocurrency and is available in a limited amount, its demand is increasing in today’s cryptocurrency market. There are only 21 million Bitcoins circulating in the market. The miners continuously mine Bitcoin.

In addition to Bitcoin trading, we have also seen a rise in the number of Bitcoin ATMs.   These are just like the other ATMs but not connected to any specific banks. Now the most common question arises why bitcoin is highly valued?

So here we are going to discuss some of the main reasons behind the high value of bitcoin.

Why is bitcoin highly valued?

  • Since bitcoin is a decentralized digital currency, the user doesn’t need to go through or connect with any specific bank to make any transaction.
  • Also, bitcoins are the oldest crypto, so the awareness of bitcoin in the market is much more than other digital currencies.
  • As a product becomes rare, its value increases. Similar to this concept, the number of Bitcoin is limited, and so its value is also high. In addition, Bitcoin also enjoys the benefit of being the first cryptocurrency. This also adds to its value.
  • It is based on software technology, and everything will be done online.
  • No involvement of any third party. Bitcoin is a public asset. There is no central authority controlling it. Bitcoin transactions are hassle-free. This makes the selling and buying of bitcoin independent.
  • Bitcoin is the source of investment. People invest in bitcoin and expect a better return in the future. It is also known as “Digital Gold”.
  • Bitcoin ATMs are started in different countries, so the selling and buying of bitcoins have become very easy and reliable for users. 

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Is Bitcoin safe to buy?

The user can also buy the bitcoin on the government-approved cryptocurrency exchange like coin base and you can buy bitcoin in Canada too. Since the price of bitcoin is very volatile, there is no guarantee of higher returns or even losses in the future. Investing in any cryptocurrency is highly risky, so the client must be very aware of bitcoin’s information. Digital currency is the better platform for beginners and also very helpful in providing information on selling and buying bitcoin every second.

What determines the bitcoin’s price?

Bitcoin is not mined by any bank or any central authority, so whoever buys the bitcoin has become the owner of that bitcoin. The fluctuating price of Bitcoin also poses a risk, so as a wise investor, you must know the reason behind the fluctuating price. Several factors are contributing to it:

  • Supply of bitcoin
  • Demand
  • Mining rate of bitcoins
  • Availability

What is the price of 1 bitcoin?

Since the price of bitcoin is dependent on several factors, the intrinsic value of a single bitcoin is determined by the marginal cost of production of a bitcoin at a given time and based on the block reward.

We hope that your confusion is now solved that why bitcoins are exactly highly valued on the cryptocurrency platform. Different bitcoin exchange platforms are being used in very large amounts. And also, people use Bitcoin wallets to store this digital currency and privatekeysy secure from online threats. And Bitcoins ATMs are also started for the customers to sell bitcoins through it without being connected to any specific bank. Since there are so many uses of bitcoins with several advantage,s the bitcoins are worth higher values.

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