Cryptocurrencies evoke interest, especially in young people, who are interested in modern technologies and accept higher investment risks but would also like to make the highest profits possible over a relatively short period of time using cryptocurrencies. Why is it Bitcoin, one of the most popular cryptocurrencies in the world, that enjoys so much interest of young investors? What is it that makes Bitcoin different from other popular investment instruments?
What is Bitcoin anyway?
To understand the growing interest in Bitcoin (BTC) among young people, you need to have some knowledge of that cryptocurrency, which emerged quite recently – in 2009. The Bitcoin cryptocurrency is also referred to as a virtual currency. It was created by Satoshi Nakamoto, but we do not know for sure the name, or names for that matter, of the authors of that most popular cryptocurrency in the world. It is based on the blockchain technology and is decentralised. Contrary to the classic fiduciary currencies, such as euro or American dollar, Bitcoin remains independent from decisions of authorities of any country. It is not issued by any national bank. Instead, it is mined – dug by the so-called cryptocurrency miners. Its number is strictly defined – there will be no more than 21 million BTC.
This cryptocurrency serves to store and send information about transactions made over the Internet. It is impossible for transaction data to leak and fall into the wrong hands.
Where does young people’s interest in BTC come from?
The huge interest in Bitcoin, mainly on the part of the youngest investors, stems from its independence and opposition to the old order in the financial sphere. The speculative value of that cryptocurrency is significant as well. The cryptocurrency gives an opportunity to make huge profits if someone bought it at the beginning of 2017 and sold towards the end of that year – they could make even several times more money.
All that is, however, related to the risk of losing on BTC investments. The institutions supervising the financial market in the world, i.e. the National Bank of Poland in the case of Poland, warn against too hasty allocation of the owned investment capital to cryptocurrency trading.
As already stated, BTC is based on the blockchain technology. It serves to store and send information about transactions made over the Internet.
The investor can invest in BTC by buying that cryptocurrency for instance on a cryptocurrency exchange. Bitcoin allows the investor to make payments online – you can use it to buy e.g. goods in Japan, still remaining in Poland, and then make a quick payment and wait for the goods to arrive. The process of carrying out transactions is much shorter in such a case.
Bitcoin allows to make money easily if good investment decisions are made. However, Bitcoin investments entail high risk. The higher the risk, the higher any potential profits may be. The interest in Bitcoin, especially on the part of young people, stems mostly from its speculative value.
At present, Bitcoin is in a falling phase. In December 2017 it was valuated even at 1 BTC = 20,000 American dollars. Those who invested in Bitcoin at that time are currently sustaining losses, but experts claim that the virtual currency will rebuild its value in the future.
What is significant is that the investor who owns Bitcoins can maintain full anonymity. Nobody from the outside has to know that a given person has that popular cryptocurrency in their investment wallet or that they make money on it. Transactions are confidential and no government has access to them. Therefore, the investor can amass a multimillion fortune, which will go unnoticed by their surroundings unless, of course, they want to share information about their success.