- El Salvador became the first country to adopt bitcoin as legal tender in 2021. Will others follow? The law has already proven successful in a few ways for El Salvador.
- Bitcoin reached its all-time peak of nearly $69,000 in November of 2021. Could it swing even higher in 2022?
- Tesla, the electric carmaker headed by billionaire Elon Musk, has started to allow people to buy brand merchandise using Dogecoin.
- Major investors are moving more and more of their assets into Bitcoin since it outperformed gold by a margin of 127% last year.
- Crypto became a household name thanks to sponsorship and naming rights deals for sports arenas in major cities like Miami and Los Angeles.
5 Reasons to start investing in crypto right now....
Cryptocurrency as a hedge against inflation
Inflation levels in the USA reached 40-year peaks in 2021. Heading into 2022, the US Bureau of Labor Statistics reported that the consumer price index rose 7% for all items. This was the highest recorded increase since 1982. Many factors can lead to higher inflation; one major factor is more free money flowing into the economy. Bitcoin’s value is actually deflationary, meaning its purchasing power is more likely to increase over time. Bitcoin’s scarcity is why some consider it to be an effective hedge against inflation. There will only ever be 21 million Bitcoin in existence. Ever. That built-in scarcity is why some investors rushed to hold Bitcoin during a period of rising inflation.
Local governments are increasingly looking at crypto
Everyone knows about taxes. But what are cities and local governments doing with that tax revenue? Increasingly, cities are looking at ways to save their cash reserves in crypto. Part of it is the anti-inflationary hedge mentioned above, but another part of it is that cities and local governments see crypto as a growing opportunity to attract talent while stabilizing their balance sheets. When civic leaders are asking to receive their paychecks in crypto, that means that the average citizen may not be far behind.
Think crypto’s too complicated? Crypto IS casual
Investors aren't the only people holding assets tied to the blockchain. Non-fungible tokens, better known as NFTs, exploded in the past year. More casual collectors and gamers found themselves holding and trading NFTs as this term created major buzz, even rising to become the “word of the year” for 2021 according to Collins Dictionary. This rapid adoption meant that more people started utilizing the technology that powers crypto, the blockchain, and proving its versatility while also becoming owners of some pretty cool digital art. Where can NFTs go from here? The possibilities are vast.
Powering a new global payments system
Sending payments around the world used to mean tapping into a series of complicated networks. There are wire fees, differing exchange rates, and of course the thorny issue of how the recipient may store or even access the funds once they’re transferred over. With crypto, the process is so simple and streamlined that people may begin to wonder why it was ever done any other way. Imagine deciding how much you want to send to someone, pushing a ‘send money’ button, then it’s done. It’s that simple! No third-parties involved, no ridiculous wire fees, no opaque exchange rates controlled by central governments. Just assets flowing from one digital wallet to the next.
The pool of investors isn’t huge – for now
We mentioned there will only ever be 21 million Bitcoin in existence. Did you know that close to 19 million of that supply has already been mined as of January, 2022? There are just over 2 million Bitcoin remaining to be mined. Think it’s too late? Hardly. According to a Pew Research Center Survey conducted in 2021, 16% of Americans have invested, traded or otherwise used cryptocurrency. That means the vast majority of Americans still haven’t dipped into this expanding market. Bitcoin came into existence in 2009. And back in 2015, only 1% of people surveyed had ever used Bitcoin. Now here we are, over 13 years later and the total market cap for all cryptocurrencies has risen to more than $3 trillion dollars. The pool is getting bigger, there’s no doubt about that. The real question is, how early do you want to dive in?