What’s bitcoin? Why the digital forex grew to become well-liked

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What is bitcoin? Why the digital currency became popular

April 6, 2021 8 min read

This article was translated using AI technologies from our Spanish edition. Errors can occur due to this process.

The opinions expressed by the entrepreneur’s contributors are their own.

It was the summer of 2012 when I saw the occasional headline in my mailbox and news applications mentioning “the digital currency,” bitcoin. I remember asking my office colleague, “Do you think we should invest?” And then all the questions we could ask ourselves came up:

  • What is bitcoin
  • Where do we buy it?
  • Will it be worth investing?
  • What is blockchain?
  • What is an exchange?

It would be up to five years later for me to start answering questions like this, as well as many new ones that surfaced along the way, which eventually encouraged me to fully step into the world of cryptocurrencies, the revenue of which is now coming from my own company Allocating capital to buy my first digital assets.

Now, in 2021, as trade ambassador for the most comprehensive exchange in Mexico and Latin America, I am sharing experiences, analysis and advice with the crypto community for people who, like you, who also ask the questions I had, venture into the world of Cryptocurrencies with the highest number of doubts resolved to generate income from these digital assets.

The first cryptocurrency

BITCOIN ($ BTC) had its origins as open source software, presented by “Satoshi Nakamoto”, alias of a programmer or group of programmers whose motivation for its development was the 2008-2009 economic crisis, especially the one Decision to print money to save banks after the credit and stock market crisis of the real estate bubble.

Bitcoin is known as the first cryptocurrency of the more than 2,000 cryptocurrencies today, regardless of government authorities (decentralization). Production is entirely digital, subject to an issue limited to 21 million bitcoins.

This means that only 0.27% of the world’s population could have 1 full bitcoin.

characteristics

  • Relative anonymity: Every Bitcoin transaction is stored in the blockchain, a unique, immovable record that guarantees both the security and the availability of information at all times. For cryptocurrencies, it can be considered the book in this book. All transactions of digital assets are recorded. In contrast to banks, crypto asset portfolios are not tied to our personal data.
  • Durability: Since it is a digital asset, it cannot be physically damaged, altered, or damaged and can be kept online forever.
  • Portability: Virtually any amount of money is easy to carry and use as it is a digital asset, either in your physical or digital crypto asset portfolio.
  • Security: Since it is an encrypted asset, it cannot be controlled by anyone in a decentralized network. While all of our funds are secure on the blockchain, an important recommendation is that all of your passwords, access codes and “passphrase” (series of security words) are physically stored in a secure location to reduce the risk of loss. during a cyber attack.

Bitcoin in the course of 2020

Without a doubt, we have all been exposed to more news and publications about Bitcoin on social networks, probably more people in your circle of friends, as well as some of your relatives, have joined the digital asset world.

Weekly chart, Bitcoin price action / Image: trade view

The way to the record:

  • The Bitcoin price chart shows the decline in major support generated in November 2018 and exceeded in April 2019. It hits a maximum of $ 9,214.67 and a minimum of $ 3,858, closing the month at $ 6,424.35. In November 2020, the price of Bitcoin not only hit the highest price ever (ATH – “All-Time High”), it surpassed it, reaching $ 19,915.14 on Coinbase, a platform for exchanging crypto assets. This represents a 415.60% growth from the lowest price of $ 3,858 in March.

With the uptrend that started in April and rose more than $ 14,000 (+ 263.25%) in late November, it has caught the attention of more and more people and institutions

In addition to the volatility of crypto activity, the impact of the current health contingency that forced people to exchange their Bitcoin for cash would only result in a 51.82% drop in March and the price from $ 8,024.38 to $ 3,866.11 increase .

That same month of March, as a measure against COVID-19, the United States government would approve economic stimulus and begin distributing checks for $ 1,200. And in April, Brian Armstrong – Coinbase CEO – announced a record of purchases and deposits of exactly $ 1,200. It shows that people used such economic stimulus to invest in Bitcoin and other crypto assets.

In October, PayPal announced it would offer payments in cryptocurrencies from 2021 and have a crypto wallet that would allow users to buy, sell and own cryptocurrencies through PayPal applications, with support for crypto assets. like Bitcoin ($ BTC), Ethereum ($ ETH), Bitcoin Cash ($ BCH) and Litecoin ($ LTC).

On November 17th, Ricardo Salinas revealed in a post on Twitter that he has a liquid portfolio of 10% in Bitcoin. It’s worth noting that, according to the Bloomberg Billionaires Index, he has $ 11.8 billion in net worth through his stakes in retail, banking, and media companies.

Today I recommend THE BITCOIN PATTERN. This book is the best and most important to understand #Bitcoin.

Bitcoin protects the citizen from state expropriation.

A lot of people ask me if I have bitcoins, YES. I invested 10% of my liquid portfolio in pic.twitter.com/6LtFVCXvuA

– Ricardo Salinas Pliego (@RicardoBSalinas) November 17, 2020 Bitcoin is trading at over $ 60,000! It would be on December 16, when the price topped the all-time high set in 2017, attracting massive attention and ending the year at a price of $ 28,990. Creation of new highs in January (~ USD 42,000), February (~ USD 58,400) and March (~ USD 61,800), 210.26% growth from the maximum set in December 2020, as well as SMEs using crypto as a payment method.

Weekly chart, Bitcoin price action, March 2021 / Image: trade view

Accessibility We Mexicans have more and better opportunities to acquire Bitcoin and other cryptocurrencies. The exchanges (Cryptocurrency Exchange Platforms) have bet on the Mexican market.

“We have been at the forefront of developments in the blockchain market for years and have seen the gradual rise of the Latin American market as an important region in this segment. In our view, this region, especially Mexico, has great potential for being the next blockchain- Hub for years to come. “, Maggie Wu, CEO and Co-Founder of Mexo.

For his part, Changpeng Zhao, CEO of Binance, says: “There is a great need for cryptocurrencies in Latin America, especially for financial access. We continue to work with our key partner, Settle Network, to improve access to cryptocurrency in Latin America and will support more local fiat currencies in the region in the future. “”

The accessibility and parabolic growth offered by Bitcoin have made it normal and more common to hear and read Bitcoin. What is your price prediction for Bitcoin given the exposure of the exchanges to the Latin American market, acceptance by institutions, SMEs and investors, and the growing number of people diversifying their investment portfolios between Bitcoin and other cryptocurrencies? Are you already investing in crypto?

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