Successful investors know how to spot the perfect asset to purchase. However, successful traders know when is the perfect time to place a buy order. The cryptocurrency market has been moving in a sideways trend. This is the perfect opportunity to trade and make profits in the short term. Currently, Bitcoin is showing interesting reasons as to why it is the perfect time to buy it. Here are 3 reasons why it is the perfect time to buy Bitcoin now.
- 1 What is Bitcoin?
- 2 Why is Bitcoin a Good investment for the future?
- 3 Top 3 Reasons why NOW is a Good time to Buy Bitcoin
What is Bitcoin?
Bitcoin is the earliest and best-known cryptocurrency in the market. Based on Satoshi Nakamoto’s white paper, this first truly decentralized currency was created in 2008 and released for use for the first time in January 2009. Bitcoin evolved from a currency that was only worth a few pennies to a financial asset that is currently valued at 5-digit rates in dollars per unit.
Blockchain technology is the foundation of Bitcoin. A decentralized reservation system exists on the blockchain of Bitcoin. Peer-to-peer transactions between two persons are possible in this. Since the transactions are decentralized confirmed, written to, and kept on the blockchain, there is no involvement of a central third party.
Bitcoin has evolved into a representation of independence and freedom in the financial industry throughout time. because no centralized entity, like a bank or a government, has any control over or influence on Bitcoin. Many investors are drawn specifically to this freedom.
Why is Bitcoin a Good investment for the future?
Now many investors will be wondering what makes us and other analysts so sure that Bitcoin can continue to rise in price. Well, it all has to do with its internal structure. Let’s explain.
Internal Structure of the Bitcoin Blockchain
The Bitcoin blockchain was created with the intention that Bitcoin’s value as a commodity will rise over time. Here, three mechanisms are essential:
- There are only so many Bitcoins available. A maximum of 21 million Bitcoins can ever be generated. As a result, Bitcoin is scarce and has a finite quantity, making it comparable to the valuable metal gold.
- The process of creating Bitcoins grows increasingly time-consuming and challenging with time. This is due to the fact that as the blockchain grows, it becomes more challenging and time-consuming to add new blocks.
- The benefits of mining bitcoin are halved with each halving of its value. As a result, the mining process is certain to get harder and less lucrative over time.
While the demand for Bitcoin continues to rise, these processes control the supply. Because of the straightforward market laws, Bitcoin should increase. From the beginning, Bitcoin was designed with a deflationary structure.
Top 3 Reasons why NOW is a Good time to Buy Bitcoin
1- Microstrategy Bought MORE BITCOINS
MicroStrategy is the biggest independent and public business intelligence company that has one of the top enterprise analytics platforms. Its founder Micheal is notoriously known to be a Bitcoin aficionado. He basically influences the board to acquire Bitcoins. Every now and then, Microstrategy purchases Bitcoins in the millions and adds them to its balance sheet.
Last week, Microstrategy paid approximately $6 million to purchase 301 Bitcoins. With such purchases taking place, cryptocurrency prices are inescapably going to rise, especially given the market’s general lack of optimism. Microstrategy officially owns as of October 1st 130,000 Bitcoins. Nearly $4 billion went to the purchase of all the Bitcoins, resulting in an average price of $30,623 per coin.
2- Bitcoin’s technical prices confirmed a price increase
It is no secret that the crypto market has been consolidating for the past couple of months. In figure 1 below, we can see Bitcoin’s price action moving in a sideways trend since mid-June 2022. Recently, Bitcoin prices reached the bottom trendline of the parallel channel. This often results in a rebound in Bitcoin prices. In fact, we can already see Bitcoin prices rise from the low price of $18,500.
Bitcoin price should next reach $22,000 as a first target, then the price of $24,500 as a second target. Ever heard of “buy low, sell high”? Well, this is the perfect time to apply this saying!
3- Consolidations hint at upcoming Uptrends
Especially after harsh downtrends, consolidation phases come in place to ease and halt falling prices. This proves that there are buyers willing to catch and buy at that consolidation price. Bitcoin reached its low of $18,500 and breached it for a brief while before getting back into the consolidation.
This shows that Bitcoin investors are willing to buy bitcoin at that specific price in anticipation of higher prices. Once the selling pressure becomes less, Bitcoin prices should increase. This is especially true as the Bitcoin cycle shows upcoming higher prices. However for now, it is smart to trade Bitcoin and other cryptocurrencies. In rising markets, crypto enthusiasts should turn to investors, while during bear markets, they should turn to traders.
Crypto prices might continue to consolidate or even slip lower during the first half of 2023, however they should turn bullish afterwards.
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