When Bitcoin first emerged on the scene, it was introduced as a currency. Some even referred to it as the currency of the future, meant to move transactions into digital form and potentially supplant the likes of the dollar and euro. But over time the idea that Bitcoin’s primary purpose as a functional currency was called into question and in September 2015, the U.S. CFTC even went so far as to officially designate Bitcoin as a commodity.
That decision didn’t have any practical impact, but it classified Bitcoin more along the lines of silver or crude oil than the dollar or euro. And in some ways it was the big signal people needed to ask the simple but vital question: is Bitcoin a good investment opportunity?
Fast-forward nearly two more years, and the answer to that question has been yes. That’s not to say Bitcoin is necessarily a wise investment right now, but it certainly would have been at the time of the CFTC’s ruling, and investors have been piling on ever since. More and more people seem to be buying Bitcoin not to use in everyday transactions, or even occasional ones, but rather to store for the long-term in the hopes of selling for a profit. But this isn’t just because of the CFTC designation. There are a few other factors playing into why Bitcoin is being taken seriously as an investment as well.
The main reason more people are looking into Bitcoin investment is simple: they regret not doing it sooner. Bitcoin’s price has been soaring for quite some time now, and has already reached highs around $3,000 that some never thought it would see. Just recently a stock analyst predicted it could reach $50,000 in another decade. That might be a particularly outlandish prediction, but it’s a also a good snapshot of how people are viewing the commodity. They’ve seen lucrative growth particularly in the last year, and they can envision more in the years to come.
We’ve seen brick-and-mortar and online merchants alike hopping aboard the Bitcoin train sporadically for a few years now, but recently larger industries and even nations have been facilitating more usage (which drives up value). Late last year, we saw licensed online casino platforms beginning to accept Bitcoin in a move that could ultimately lead to millions of players using it for transactions. More recently we’ve seen countries like China and Japan lighten restrictions on the use of Bitcoin, which could bring large portions of their populations to the table. Developments like these make cryptocurrency seem more like a lasting asset and less like a passing trend.
There’s also the fact that people are starting to get used to Bitcoin, and in this case that’s probably a good thing. For a while, a lot of people viewed it as a temporary blip on the radar, or at best a legitimate asset with limited appeal. But Bitcoin has stuck around longer than some thought it ever would, and that has inevitably given it an air of legitimacy and stability.
Again, none of this means that Bitcoin is necessarily a good investment at this moment. There are other factors involved, and it’s important to do your due diligence if you’re considering buying in. But if you’ve been surprised even at how seriously it’s being taken, these are a few reasons behind the shift in attitude toward the world’s leading cryptocurrency.