Many people are playing with the thought of investing in Bitcoin. They ask themselves questions like, “How much does a Bitcoin cost?” “Is it still worthwhile investing in Bitcoin?” “Should one invest in Bitcoin or not?” In fact, there are many good reasons to invest in Bitcoin. Of course, there’s a lot of information out there, and not everything you can find is there.
So, before you can invest in Bitcoin on the internet, you should be well informed. For all those who are perhaps considering investing in Bitcoin, we have compiled the most important information and facts below. In short: an investment in Bitcoin is also a good idea in 2020.
Investing in Bitcoin: Yes or no?
Perhaps you, like many other interested parties, are wondering whether it is still worth investing in Bitcoin in 2020. Of course, there are the legendary tales of crypto-millionaires and Lambo drivers who invested in Bitcoin more than 5 years ago, when the price was still below 10 USD. Even though such a profit potential is no longer apparent today – and many of these legends are also pure invention – Bitcoin is still worthwhile. And very much so.
For example, if you had decided to invest 1000 USD in Bitcoin on January 1, 2019, you would have already made more than 500 Euro profit by the middle of the year – 50% return in less than 5 months. The question “Is Bitcoin still worthwhile?” can therefore be answered with a clear YES.
Traders are even making a lot of money that way since years as they are constantly watching price movements and profit from them in both directions (ong and short trades). But this is something you have to be a pro in, for investing beginners this so called margin trading isn’t recommended. If you want to trade BTC from the USA you even have very few options as crypto margin trading is very restricted there.
But WHY one should invest in Bitcoin – this question requires a closer look. That’s why we have put together a list of good reasons why investing in Bitcoin makes sense and is still an excellent idea in 2020.
What does a Bitcoin cost?
An important aspect for all those who want to invest in Bitcoin is of course how the Bitcoin price is at the moment. But first of all, it is important to note that you can buy any part of an entire Bitcoin. So if you want to invest in Bitcoin for the first time, you can do so with a small amount of money and buy more at a later date. So what does a Bitcoin currently cost? The answer to this question is constantly changing, the Bitcoin price is very dynamic.
You can check the current Bitcoin price on coinmarketcap.com.
Once you have decided to invest in Bitcoin, it is advisable to keep an eye on the Bitcoin price. However, you should not be tempted by sometimes stronger daily developments to panic (sales) buying. The Bitcoin price is sometimes very volatile and can sometimes fluctuate by a double-digit percentage. To keep track of how much a Bitcoin currently costs, you can either visit websites such as Coinmarketcap, or take a look at our Bitcoin price index.
As a prospective Bitcoin investor, you will naturally ask yourself how the Bitcoin price will develop in the near future. Experts and analysts have already racked their brains on this question and are constantly updating their assessments. In our Bitcoin Forecast we have summarized numerous expert opinions and current market developments for you.
Is a Bitcoin Investment still worthwhile? There are several Reasons for this
There are several reasons why an investment in Bitcoin will still be worthwhile in 2020:
- The price recovers from the adjustment in 2018
- Bitcoin trend clearly points upwards
- Many experts and analysts are increasingly optimistic
- The market adoption of Bitcoin is growing rapidly
- Bitcoin ETFs are on their way and will bring many new investors
- Bitcoin’s protocol is being continuously developed and will soon be able to scale
- Shopping with Bitcoin is getting easier and easier
- Perfect for trading with Altcoins
The Price recovers from the Retracement in 2018
2018 was not a good year for all Bitcoin investors. Bitcoin, like virtually all other cryptocurrencies, went downhill rapidly, with annual losses of up to -85% in the end. What caused a lot of excitement and trouble in 2018, meant a lot of good things for 2019. For one thing, last year’s losses led to a long overdue shakeout in the crypto market, caused by the massive rises and hype in Q4 2017.
Many market participants, who had entered the market as pure speculators, have left the market again (disappointed). In contrast, interested and more long-term oriented investors have consolidated their investments and remain in the market. As a rule, this also means that phases of extreme volatility – price fluctuations of more than 10% per day – should at least largely be a thing of the past. In addition, the adjustment of the previous year’s Bitcoin also prepares the ground for solid price gains. There are many indications that Bitcoin is clearly undervalued, with a value of around €5500.
Bitcoin trend clearly points upwards
Following on from the previous point, it appears undisputed that Bitcoin is currently still clearly undervalued. The Bitcoin Trend 2020 is also clearly pointing upwards so far. At the beginning of the year Bitcoin was valued at 3750 USD according to the coin market cap, on May 4 it was quoted at an impressive 5870 USD. In a year-on-year comparison, this results in a healthy price increase of 56%! This is a remarkable return, which of course cannot be achieved so quickly with classic investor instruments. The market is clearly in a bullish mood for the Bitcoin price 2020. The signs are good that the price will continue to rise in the coming weeks and months. This is also ensured by many of the other developments which we discuss below as further reasons for investing in Bitcoin.
Many Experts and Analysts are increasingly optimistic
The list of experts who expect positive developments includes many well-known names in the crypto world. Among them is Sonny Singh, the Chief Commercial Officer of Bitpay. As a payment processor, his company is responsible for ensuring that more and more large and well-known companies accept Bitcoin as a payment method. For his company, he expects to be able to attract many new companies to Bitcoin in the coming months. Estimated analyst Tom Lee, former strategist at JP Morgan and co-founder of Fundstrat, also sees a bullish (i.e. rising) Bitcoin price.
Mike Novogratz, who will be known to many as the founder of Galaxy Digitial, a merchant bank for crypto and block chain companies, even estimates that Bitcoin could reach five-digit figures again. Bobby Lee, CEO of BTCC – a crypto-exchange that was brought to its knees by China’s crypto-ban has also expressed his optimism. The tireless efforts of the Winklevoss twins (whom they may know as competitors of Mark Zuckerberg in the early days of Facebook) to obtain approval for Bitcoin ETFs in the U.S. also testify to the potential and positive development they foresee for Bitcoin in the coming times. It should also be noted that the Winklevoss twins are likely to be one of the largest owners of Bitcoins ever.
The Market Adoption of Bitcoin is growing rapidly
Another important signal that connaisseurs and analysts pay attention to is the trading volume. The higher the daily trading volume, the greater and more dynamic the demand for Bitcoin. A quick look at Coinmarketcap reveals that the trading volume of Bitcoin has developed very positively. While it was only around 5 billion USD per day at the beginning of 2019, it has risen rapidly since mid-February to just under 10 billion USD in March.
Since April there has been further growth, so that Bitcoin worth between USD 15 and 18 billion is now being traded daily. A high trading volume is naturally also a positive sign for investors. This gives investors the certainty that they can sell or exchange their Bitcoin for other coins at any time.
Bitcoin ETFs are on their Way and will bring many new Investors
An additional important step for the rise of Bitcoin is the admission of so-called exchange-traded funds (ETFs), which use Bitcoin as the underlying asset. These financial instruments make it interesting for a new group of investors, such as institutional investors or family offices, to invest in Bitcoin. Bitcoin ETFs are traded on the open market, which means that their price can also develop dynamically through supply and demand.
The advantage of investing in a Bitcoin ETF is that you do not have to worry about keeping Bitcoins in wallets yourself, but that you can buy a regulated investment product on the market and sell it again if you wish. (If, on the other hand, you want to buy real Bitcoin, you can decide whether you want to invest in Bitcoin or rather buy a Bitcoin ETF).
In Europe, Bitcoin ETFs are already a reality. In the USA, on the other hand, it will not be long before the time comes – here the Financial Market Authority must first give its approval, although most analysts expect this to be a matter of weeks to a few months. The more countries approve Bitcoin ETFs, the more demand for Bitcoin will increase. This will of course also lead to a rise in the Bitcoin price.
Bitcoin’s Protocol is constantly being developed and will soon be able to scale
Of course the Bitcoin price 2020 is not only strongly influenced by market factors. Because the crypto currency Bitcoin is based on the innovative block chain technology, the technological factor must also be considered as an important aspect. So far, there have been two main challenges for the Bitcoin protocol. This is the rapid scalability of transactions per minute, because every transaction on the Bitcoin block chain must be verified and confirmed by several participants (nodes) in the block chain network. Previously, only very few transactions per minute could be processed, resulting in long transaction times and often high transaction costs (the second challenge).
For more than a year, developers have therefore been intensively looking for ways to increase the scalability of the Bitcoin block chain. With the Lightning Network this will now become possible. This will enable many times more transactions per minute to be processed and verified. As a result, transactions with Bitcoin will become much faster and cheaper in the future. This eliminates an important obstacle to further growth and wider adoption of the Bitcoin blockchain and paves the way for Bitcoin’s rise to the ultimate digital currency.
Shopping with Bitcoin is getting easier and easier
The value of a cryptocurrency such as Bitcoin also depends heavily on what it can be used or applied for. Times when Bitcoin was mostly used for betting and as means of payment in online casinos have long gone by. The higher the number of uses, the greater the benefit of owning Bitcoin. The number of merchants and online shops that accept Bitcoin as a payment option is increasing day by day. For example, this also includes Microsoft, where you can use Bitcoin to pay into your account to purchase games or apps from the Microsoft Play Store. At the same time, it is important that it is becoming easier and more convenient to be able to purchase Bitcoin.
In Austria, for example, you can now do this at any post office. More and more Bitcoin vending machines also mean that it will be possible for more and more people to purchase Bitcoin – including those who might have been able to get their hands on it until now because of issues such as public keys, private keys and Bitcoin wallets. The easier it is to buy Bitcoin and the more numerous the merchants and points of sale where you can pay with Bitcoin, the greater the benefits of Bitcoin – and consequently a positive price development is practically guaranteed.
Perfect for trading with Altcoins
Even for those beginners and advanced users who are thinking of becoming crypto traders, an investment in Bitcoin is the most sensible first step. After all, Bitcoin is and remains something like the “gold standard” in the world of crypto currencies. Bitcoin is accepted practically everywhere in the crypto world. Regardless of which of the leading exchanges such as Binance, OkEX or Bitcoin exchanges you wish to trade in crypto currencies – a deposit in Bitcoin creates the necessary credit balance to be able to carry out your first trades.
In general, Bitcoin is also well suited to “temporarily storing” the profits from successful trades on crypto-exchanges. Of course, as a conservative investor, you can also consider transferring the money in fiat currency. But then the transfer times are longer and the transaction costs higher. Profits from successful crypto trades can therefore be converted back into Bitcoin at the same exchange. In this case, however, it is best to store them securely in a Bitcoin wallet (e.g. a hardware wallet).