January 7th, the world’s investors and economists were left in awe after they saw how the Bitcoin price witnessed its second boom since 2018, soaring more than 700%, and surging above the $40,000 mark per Bitcoin.
For some perspective, if you were to have bought a single bitcoin before the boom when a single bitcoin was valued at only $10,000, I say only because compared to how much it is valued at currently it’s trivial. Anyways you would have made a profit of approximately $30,000 dollars absurd I know but it was a reality for many.
How does Bitcoin work though? To break it down into simple terms in the whole cyberspace world there are these virtual coins that are mined by bitcoin miners which are then put out into the market by the miner for whatever value the Bitcoin is on the market. The thing is Bitcoins are so hard to mine requiring ridiculous amounts of energy close to 300 kilowatts for some comparison the average household in America uses 900 kilowatts per month.
That being said there is a very limited number of Bitcoins out there and by rules of supply and demand if the supply is low and demand is high the value of the Bitcoin will go up. The demand for Bitcoin is currently through the roof because of the opportunity at making riches but low supply.
Mark Cuban explains Bitcoin on his Twitter page saying, “Watching the cryptos trade, it’s EXACTLY like the internet stock bubble. EXACTLY. I think btc, eth, a few others will be analogous to those that were built during the dot-com era, survived the bubble bursting and thrived, like AMZN, eBay, and Priceline. Many won’t.” Mark Cuban endorses Bitcoin and other such cryptocurrencies are going to do well and be just like the huge company’s today like Amazon. Just this single tweet from Mark Cuban caused many more investors to take a spot in the cryptocurrency world further increasing the price because of the very scarce supply of Bitcoins.
“Some people, like me, invested a modest amount and have done sensible things like buying boring cars and overpaying the mortgage,” Said Chris Sedgwick. Chris is one of the success stories of this recent Bitcoin boom. Making hundreds of thousands of dollars from a relatively small initial investment. He has a different approach to how he is going to use his investment a much safer and long-term approach.
Peter Smith, CEO and co-founder of crypto exchange has this to say about this recent Bitcoin boom, “Bitcoin’s become inevitable. Bet on Bitcoin’s inevitability,” he said. With that being said, keep an eye on Bitcoin this year there is a good chance this isn’t the peak of Bitcoin we are only seeing the beginning.