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3 Great Reasons To Buy Bitcoin

Posted 23 July 2017 3 Great Reasons To Buy Bitcoin
Written by Jon Gulson @jongulson

A new gold rush is upon us, only this time its digital. Adoption of bitcoin is increasing and in its relatively short life, bitcoin has already produced millionaires; college kids are either dropping out or graduating straight into retirement thanks to it.

Yet there are still many people who haven’t heard of bitcoin. Or if they have, they associate it with the unbalanced and negative publicity it sometimes receives. So here are three reasons to buy bitcoin:

1. Diversification: an investment portfolio is not properly diversified unless it holds bitcoin. Bitcoin is uncorrelated and independent from other investment assets with no direct relationship with them. In a global economy with sluggish growth and record levels of debt, diversifying just a small part of a portfolio (into bitcoin) could prove prescient.

2. Be Your Own Bank: bitcoin is decentralised: it does not have a CEO or boss. This means you don’t need to ask anyone’s permission to use bitcoin and you are not paying the fees and charges associated with traditional banking. Bitcoin is also trustless money, meaning you are not placing faith in a financial intermediary or middle man.

3. The World Wants to go Cashless: the volume of contactless transactions around the world is increasing sharply. Contactless is convenient for consumers, with merchants appreciating the frictionless nature of digital payments. It appears cash is no longer king and if removed entirely, people will begin to appreciate the privacy features of bitcoin as digital money.

Of course, bitcoin has risks; so please consider the following:

1. Volatility: despite assurances you may read about bitcoin maturing and stabilising as a currency, bitcoin is – and probably always will be – volatile. This is especially true over short time frames. So bitcoin is not for the fainthearted or amateur trader, but over the medium to long term it has a strong reputation for delivering (ask any seasoned hodler!)

2. Lost Private Keys: bitcoin has a very high level of cryptographic security across its network. However, if you lose your private keys (the private numbers which allow your bitcoins to be accessed) your bitcoins are lost forever and unlike a normal bank, you are not insured for losses. So keep your private keys safe!

3. Regulatory Intervention: to say bitcoin is anonymous is not strictly true: transactions are traceable, even if sometimes difficult to link with real life identities. Whilst this makes bitcoin pseudonymous, its use on dark web markets attracts the interest of regulators and government agencies. However bitcoin was the first blockchain, which has become a multi-billion dollar industry with increasing applications for legitimate commercial purposes.

The fantastic thing about bitcoin is it means many different things to different people - who would no doubt add to the points made above. What is also true is bitcoin’s increasing adoption and popularity, especially in countries with weak currencies where inflation is a problem. 

So before deciding to buy bitcoin, become comfortable with the full facts and take into account the different security measures in storing coins.

And once you are happy to purchase, good luck and see you on the moon!

Written by Jon Gulson @jongulson
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