6 Reasons Why Bitcoin is King of Cryptocurrencies

Bitcoin is a cryptocurrency and worldwide payment system which was invented by an unknown person under the pseudonym of Satoshi Nakamoto. Since its inception in 2009, its value is on a wild ride and the value has also reached all-time highest up to $19000 in December 2017 and now at the time of writing this, its value is at $9000. The value of Bitcoin rises and falls and most unstable in comparisons to fiat currencies. Almost everyone in the world has known about the tremendous value of Bitcoin, but still, people have confusion about how and why Bitcoin has any value at all?

Why Bitcoin Has Value?

To understand how bitcoins, have value, we need to understand how the fiat currencies have value. Fiat currencies are just the medium for the exchange of goods and services which is accepted by everyone and the production of currency is regulated by the government. So national currencies like US dollars, Pound Sterling, Euros have value because they are regulated, limited and accepted as a medium of exchange.

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So how something gains a higher and lower value?

Something usually gains a higher value if it is scarce and has limited resource but not just that it must also have utility too because without using it will be useless. Bitcoin is similar to Gold and even called “Digital Gold”. Just like the gold used to be mined and used as a medium of exchange and as jewelry, thus gold has gained value due to its limited resource, use of labor to mine and high demand.

Bitcoin is also mined as gold by miners and is not regulated by any government or organization like traditional banks but regulated by blockchain technology which is developed by computer programming.

What is the benefit of using Bitcoin over fiat currencies?

Bitcoin was developed as the worldwide payment system, so it can be used anywhere. It has tried to stand as the currency of the world. So the question arises here, as we already have paper currency why would we need a digital currency like bitcoin?

Bitcoin is not regulated by any government so while performing transactions, people do not need to have middleman like a bank for performing transactions, so it saves money and no need to pay taxes for sending money to other countries. People will have their own control over their money and blockchain technology is safest and unhackable.

Bitcoin is only available up to 21 Million bitcoins, then after that, it will not get produced anymore. The production will cease by 2140 as of now the supply is just 16,931,163. It has also gained its value due to more people using it. The popularity gains also increase its value because of limited resources.

A Brief Analysis of Bitcoin Price History

Bitcoin, in the year 2009, first came into existence after being mined by Satoshi Nakamoto. The first person to receive bitcoin through transaction was cypherpunk Hal Finney.

At the time of launch, bitcoin has a value of nothing that is $0. Value of Bitcoin never reached more than $1 in 2010 but the very first real-world transaction took place that year when a miner bought two pizzas from Papa John’s in Florida for 10,000 BTC. The highest price in 2010 for Bitcoin was $0.39 only.

In 2011 Wikileaks started to accept payments via Bitcoins as Visa, MasterCard, PayPal, etc. banking companies has restricted transaction to the site. It also reached $1 on February 9, 2011. Bitcoin became more popular, gained wider exposure and investments.

It gained negative popularity due to the article published about Silk Road, which used bitcoins to buy illegal drugs. After publication of article within a week, it broke all previous records and reached $31 for a bitcoin. In June, a popular exchange Mt. Gox got hacked and 4,019 BTC lost from around 600 wallets. At the end of the year 2011, the bitcoin price reached around $4-5.

The year 2012 and 2013 made bitcoin more accepted by retailers and other companies. In November 2012, WordPress started to accept payment in Bitcoins. In 2013 the price of bitcoin became to rally, it reached around $100-195 in October and above $200 to $1,120 in November.

This enormous increase in the value of Bitcoin was due to the involvement of China’s miners and operating of Mt. Gox. It reached all-time highest of $1,230 on December 4, 2013. Just in 3 days, the price dropped down to $750 which is almost 39% drop in price.

In 2014 February 4, bitcoin was trading at $920 which was stable during that time. But it drops down to $260 by February 16 which was 71% drop in the price of Bitcoin. The volatility in the price remains around few months with increase and decrease in its value. It reached $600 around mid of July in 2014.

how bitcoin works

On July 18, 2014, Dell announced to accept bitcoins as payment to purchase any Dell product online. This announcement made other retailers too, accept online payment in bitcoins. On September 8, PayPal subsidiary Braintree announced to accept bitcoins and on December 11 Microsoft also announced to accept bitcoins as payment.

At the beginning of 2015, the bitcoin’s value was around $315 and remained around $460 in 2015. On April 27, 2016, Steam, a popular gaming platform started to accept payments in bitcoins.

On January 3, 2017, bitcoin price again reached $1000 after 3 years. Japan declared bitcoin as the legal payment method after passing the bill in Parliament on April 1, 2017.

On August 1, 2017, Bitcoin hard forked into Bitcoin (BTC) and Bitcoin Cash (BCH) and the value of Bitcoin was $2787 at that time. Bitcoin reached its all-time highest price by crossing $5000 on October 13, 2017. On October 25, bitcoin hard forked into Bitcoin Gold and the bitcoin price was around $5682.

On November 28, 2017, the price of Bitcoin reached an all-time high with a value of $10000 and again managed to create a record of an all-time high on December 18, 2017, by reaching $19,498. Currently, the price of Bitcoin is around $8850 on March 21, 2018.

Related: Monero Cryptocurrency: The Ultimate Beginners Guide

Today’s Bitcoin Price

 

Why Bitcoin is and will always be king of Cryptos:

Here are few reasons why Bitcoin is and will always be king of Cryptocurrencies:

  1. Worldwide Availability

Bitcoin has come into existence as a form of money which will be used as the currency of the world. Being a digital currency, it is available worldwide.

Due to worldwide availability of bitcoin, anyone can easily trade bitcoin almost anywhere in the world. It is easy to exchange bitcoins for any local currency or any fiat currency in the world.

So, the worldwide availability of bitcoin made it King in Crypto world. Bitcoin is also being available in ATMs and has been accepted by most of the big companies as the payment method.

  1. Brand Recognition

The first mover has more advantage and it gave enough time to get recognized as a trustworthy cryptocurrency.

Bitcoin is like a huge brand name in the crypto world. People who didn’t even heard about the world cryptocurrency has heard about Bitcoin. It became like a household name.

The recognition that bitcoin got, made it a popular investment in the digital world. Still, people do not know about hundreds of other cryptocurrencies but know the name of Bitcoin as a high-value commodity and digital currency.

  1. High Hash Power

Bitcoin has the highest hash power. More the hash power, the blockchain will be more secure. It is believed that the low hash power will make bitcoin more susceptible to a 51% attack.

It will allow the attacker to make illegitimate transaction verified. But due to the enormous hash power of Blockchain, it is almost impossible to do such attack on the bitcoin network.

  1. More Demand and Limited Supply

We all know that Bitcoin has become so much popular and its demand is high. People are willing to invest in it. Even people want to store at least some part of bitcoin.

Bitcoin is even limited too and will only available up to Maximum Supply of 21000000 BTC coins by 2140. The technology that Bitcoin use will cease its production and there will be no more production of bitcoin after that.

  1. Security

The unhackable technology of Blockchain is used by Bitcoin which makes it completely safe from hackers. Being a peer to peer network, it is reviewed and tested most of the time than any other coins.

Although the bitcoin network cannot be hacked, the coins from owners can be hacked like money are theft from banks.

It is surely more secure than the money deposited in a bank because the technology cannot be hacked but only the private keys if kept on vulnerable and insecure wallets. So, Bitcoin even stands at the top as the King of Cryptos on security as it’s unhackable.

  1. Standard and Most Supported Coin

Bitcoin, since the existence, has struggled for the support but now it is one of the most widely supported and available cryptocurrency in the world. It is widely available and supported in all cryptocurrency exchanges.

Now to exchange other cryptocurrencies, most of the exchanges support Bitcoin because it is not yet possible to buy other cryptocurrencies directly with cash or credit cards or debit cards or PayPal or bank accounts.g

It is taken as standard cryptocurrency for exchange and almost available in many organization and companies as a method of payment. As a standard cryptocurrency Bitcoin has also helped other cryptocurrencies to get investments and have them existence.

Related: The 10 Best Ethereum Wallets For 2018

These all factors make the bitcoin the undisputed and yet undefeated King in the crypto world. It is not possible for any other cryptos for now to reach the height that is gained by Bitcoin. The popularity and acceptance of Bitcoin will gradually increase even more and more. The digital world will have many cryptocurrencies, but Bitcoin will be at the top of all. It is sure that with the time the value of bitcoin seems to get raised even higher.

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