It has now been eight years since Satoshi Nakamoto released his peer-to-peer digital cash system to the world, and the debate over whether or not the payment network and currency have any real, long-term value is still undecided. Having said that, some real-world use cases have emerged. Bitcoin transaction volume continues to grow year-to-year, which means someone, somewhere finds Bitcoin to be the proper way to transfer value online.
Although there are many different reasons as to why someone would become interested in Bitcoin, there are five that stand out from the rest.
1. Digital Gold
Nathaniel Popper picked the perfect title for his book, Digital Gold , which details the history of Bitcoin. Bitcoin has many features similar to gold, and it’s superior in more ways than one (more divisible, portable, durable, etc.). The only area where the digital currency cannot compete with physical gold is fungibility , but that’s an issue that may be solved in the future via privacy improvements to the system.
The various use cases of the Bitcoin blockchain are what drive Bitcoin’s value as a digital gold. Much as gold’s underlying value lies in its use in jewelry or electronics, Bitcoin’s underlying value lies in the fact that one must have some bitcoins to interact with the Bitcoin censorship-resistant ledger.
2. Trading and Speculation
The vast majority of Bitcoin transactions happen off-blockchain , and most of those transactions are on the various Bitcoin exchanges around the world. According to Bitcoinity , the all-time record for trading volume in a single day was broken on Christmas Day 2015. The record was then broken again on the 14th of January, 2016.
While some prefer to buy and hold, there are still plenty of speculators in the market who think they can time the bear and bull runs […]
