Why Bitcoin Is Not a Bubble: Key Reasons to Know

Since Bitcoin began to rise in price and gain popularity, many people began to predict its sudden collapse. At the same time, many people did not even try to use bitcoin or dive into the essence of cryptocurrencies. 

Therefore, almost from the very creation of ‘digital gold’ to the present day, some analysts, ordinary people and opponents of digital currencies speak with a single voice: ‘Bitcoin is a bubble! It should burst, and all investors will be left without their funds.’ Is that really true? Let’s figure this out!

What Is Bitcoin (BTC)?

To understand whether bitcoin is really a bubble, you need to understand the very essence of this digital asset.

Bitcoin is the very first and most popular cryptocurrency. It is a payment system based on transparent blockchain technology. In simple words, a blockchain is compared to a large public address book. This book contains data about bitcoin transactions.

Everyone can verify this data, but due to the system’s complexity, it cannot be changed. Bitcoin itself is anonymous, transparent, and has a limited supply of coins. Bitcoin is not controlled by any centralized authority. Miners are responsible for issuing coins — millions of computers around the world.

Why Is Bitcoin (BTC) Called a Bubble?

When people call bitcoin a bubble, they mean that it inflates more and more and then will suddenly burst. This is an allegory for a rapid and strong increase in the price of an asset and then for a sharp collapse in the price to zero. And, indeed, bitcoin is an extremely volatile asset. A volatile asset is an asset whose price can rise or fall sharply and quickly and is affected mainly by popularity, recognition and demand.

At the same time, there were many examples when bitcoin rose in price to $20,000 and then fell to $3,000. It rose to $60,000 and fell to $30,000. All this causes distrust on the part of many people who have not fully understood the essence and functionality of bitcoin.

There are also many people who have not thoroughly studied the cryptocurrency market and bought bitcoin with all their money at peak prices due to a lack of knowledge. After the price fell by more than 100%, such people developed a personal dislike and distrust of bitcoin and, as a rule, began to spread such rumours.

State Structures & Their Attitude

Today, some states also speak negatively about bitcoin. They are trying to ban it and predict its inevitable collapse. Their motivation is that bitcoin is a very secure, anonymous and non-government-controlled network. For the governments of some countries, the absence of control over the money supply within the country is extremely unacceptable. And bitcoin can allow all people worldwide to gain financial independence. This will take place separately from the state monetary structures.

On this basis, the governments of some countries urge not to use bitcoin, and some even ban it since the lack of control over the money supply is unprofitable for them. Therefore, you can also often hear from them that bitcoin is a bubble.

Is Bitcoin (BTC) a Bubble?

However, we have seen that most of the supporters of the theory of bitcoin, which will soon burst and take billions of dollars from ordinary people, simply had an unsuccessful experience in interacting with the asset. Many people may also have reasons not to dive into the crypto activity and, therefore, simply unreasonably blame bitcoin. Also, here are the main reasons why BTC can not be called a bubble!

Key Reasons Why Bitcoin (BTC) Is NOT a Bubble:

  • To bring down the price of a digital asset to zero, it is necessary to completely devalue it in the eyes of absolutely every independent investor worldwide. If everyone sells bitcoin at once, then a price collapse may take place. However, from the point of view of common sense, this will never happen since it is physically impossible. Such a scenario can be realized only in the event of a global catastrophe, with a complete shutdown of the entire Internet. But in this case, no one will even think about earnings, money and bitcoins.
  • For 13 years, since 2009, the price of bitcoin has only been growing. Yes, like any other asset, bitcoin has price drops. They are usually much stronger than classical government currencies or stocks on the stock market. However, this does not prevent bitcoin from reaching new all-time highs every time after a certain period of time.
  • The bitcoin program itself is based on a limited supply of coins. This means that with further growth in the asset’s popularity, the price will only grow.
  • Now the popularity of bitcoin is at its height. At first glance, it may seem that the peak of Bitcoin’s popularity since 2017, when it first reached $17,000–$18,000, has already passed. In fact, today, more and more international companies, global corporations, banks, social networks, and government agencies recognize and integrate bitcoin into their systems. Let’s add here the global economic crisis due to the pandemic. People were searching for alternative earnings and payment systems such as bitcoin and cryptocurrencies. That is why the demand for bitcoin is growing every day.
All-Time BTC Price Chart

What Is the Best Place to Buy Cryptocurrency?

If you’re wondering where to buy your first bitcoin, you should definitely think about doing it at Switchere. On our platform, you have an opportunity to buy BTC in the fastest and most convenient ways using any available payment method.

Switchere is one of the most reliable online exchanges for buying cryptocurrencies. The company is a licensed provider of financial services, with guaranteed legal compliance and a secure infrastructure system for fast crypto exchange services at fair prices.

Switchere is characterized by the fastest order processing and instant delivery — in fact, you get your ordered amount of crypto within minutes after making a payment. Moreover, we offer some surprising bonuses! Users of our platform enjoy a 0% service fee for the first order.

Conclusion

‘Bitcoin is a bubble,’ is what people unfortunate with bitcoin usually say. These are those who do not know its essence or simply people who sincerely do not believe in the development and benefit of cryptocurrencies and bitcoin. Well, How many people, so many opinions will be.

However, if we take a deeper look at this issue, it becomes clear that purely physically, bitcoin cannot ‘burst’ at one moment. And the current trend in its development confirms this. Let’s add a lot of useful properties and functions of digital gold. As a result, we will get a reliable long-term store of value, which should be in the portfolio of every cryptocurrency investor.

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