Bitcoin is exploding in the marketplace. Recently, Tesla took a huge gamble and invested in $1.5 billion in Bitcoin for January. Major market players saw the move and followed suit by also investing in Bitcoin. The price of this first cryptocurrency keeps
- Author: William Asher
- Posted: 2024-08-04
MicroStrategy, the business intelligence organization, will sell $600 million in bonds as the company bets on the rise of bitcoin. The company bought over 1 billion in tokens this past December.
Bitcoin recently hit a market cap at $50,000 which is a new psychological threshold fit the currency. Since the middle of February 2021, Bitcoin is worth a staggering $1 trillion.
Corporations Hesitant About Bitcoin
Most corporate executives, however, are hesitant about investing in Bitcoin. Their fears are not unfounded. They list reasons why they are not ready to invest in the cryptocurrency.
Gartner conducted a survey which polled 50 Chief Financial Officers.
The majority of the CFOs said the wouldn't invest in the world's favorite cryptocurrency because of volatility.
Secondly, most retail and corporate financial centers have yet to accept Bitcoin as a form of payment. You may see your favorite shop or your regular bill payer ask for the cryptocurrency, but usually, this is not on a daily basis.
And thirdly, Bitcoin is a risky investment. Corporate boards have an aversion to high risk investments.
Alexander Bant, who works for Gartner, believes that corporate tastes will change as more financial systems take on the cryptocurrency. Presently, 10% would like to invest in Bitcoin in 2024, with 16% of corporate executives considering Butcoun for the future.
Companies like to have funds reserved in safe and reliable investments, like U.S. treasuries and money market funds. Bant agrees that is essential that corporations remember that this is only a nascent in the long line of corporate assets.
Should You Invest in Bitcoin?
You may want to take part in Bitcoin. Nevertheless, think about the risks before you jump wholeheartedly into Bitcoin.
Bitcoin markets itself as a scarce commodity; the opposite is true. The cryptocurrency says it has a 21 million token limit and 18.6 million tokens already in circulation. So, it may take only 120 years before the rest if the tokens are mined and put into circulation.
This illusion is a myth. Created to fight the devaluation of the dollar, Bitcoin can increase the token count at any moment.
As mentioned before, Bitcoin is not necessarily a favorite form of payment. Only 2,300 businesses in America accept Bitcoin as form of payment. It has been a decade, and Bitcoin has not made a huge dent in popularity.
Investors prefer to hold on to Bitcoin as a means of stored value. This limits the ability of Bitcoin acting as a preferred medium of exchange within the financial system.
Next, if you time and energy on your hands, you can start your own cryptocurrency. There are no barriers of entry into the digital marketplace. Even though Bitcoin was the first cryptocurrency, doesn't mean it will maintain its advantages for preferred investor preference.
It is difficult to sell Bitcoin in the market because of short sellers. Short selling is the natural desire of investors that makes the price of the product volatile. Investors want to make money off of a product when the price decreases. This is difficult to do with Bitcoin.
Finally, you must protect Bitcoin from hackers. This is a bit of a security concern. You must store Bitcoin and you must protect it viciously. Doing 2020, over a billion dollars worth of crypto coins who was stolen. You will get no protection from the Federal Reserve if you lose your Bitcoins while you may want to get picked the currency in the future, just realized what the risks are and hopefully you will have a successful future with Bitcoin.
Finally, you must protect Bitcoin from hackers. This is a bit of a security concern. You must store Bitcoin and you must protect it viciously. Doing 2020, over a billion dollars worth of crypto coins who was stolen. You will get no protection from the Federal Reserve if you lose your Bitcoins while you may want to get picked the currency in the future, just realized what the risks are and hopefully you will have a successful future with Bitcoin.
