Here’s Why Bitcoin Is So Valuable

Editor’s Note: We’re finally setting the record straight…

Several weeks ago, we ran an essay in Insight called “The Incredible Growth of Bitcoin and Crypto.” It came from Adam Sharp, the co-founder of First Stage Investor and an expert on the fast-growing world of cryptocurrencies.

Within minutes, we received a flood of emails…

So why would you use bitcoin to buy a Burger King burger and fries versus a $10 bill or Visa card? I don’t get it. What is the advantage?
– Jim P.

Another skeptical Member wrote…

1) What need or desire is it meeting?
2) Useful for what objective?
3) Is it free from inflation?
– J. Harley

Even Members who want to get on the bitcoin train are struggling to do so…

You have put out a lot of rhetoric, but I still do not know how to invest in bitcoin or Mt. Gox. Do you recommend it, or are we watching the world go by? Help!!!
– Kevin C.

With questions still coming in, I asked Adam to write a cryptocurrency series for Oxford Club Members… a “Cryptocurrency 101,” if you will.

Today and tomorrow, Adam will give you all the information you need to know to understand how cryptocurrencies work, understand their colossal growth potential and determine if any are right for your portfolio.

To “continue your education” on cryptocurrency and access Adam’s most recent bitcoin research, click here now.

– Rachel Gearhart, Managing Editor

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Baltimore, Maryland – Throughout history, many things have been used as currency.

Livestock was one of the first forms of money. It makes sense, as a milk cow is essentially a dividend-paying asset.

But cows are not easy to trade – or divide, for that matter.

So the evolution of money continued.

Eventually the world learned how to extract metals from the ground. And those became the basis for monetary systems.

In ancient China, the Zhou dynasty used metal gardening spades as money.

Other societies relied on copper, silver, lead and gold coins.

Metals worked well as currency for thousands of years. They’re useful, easily transferable and divisible, and they offer the possibility of an increase in value.

Eventually bankers realized they could use paper bills to represent those metals. Paper bills were far easier to transfer and spend than coins were.

But in 1971, Richard Nixon ended the ability to exchange dollars for gold, and the rest of the world soon followed his lead.

Paper money hasn’t been the same since the “Nixon shock.” Since government bills aren’t backed by gold and can be printed at will, today’s monetary system is a bit of a mess.

In fact, some would say it’s vulnerable to disruption…

The New Platform

Bitcoin was created in 2009 and has been spreading rapidly since.

In just seven years, the price of one bitcoin has risen from $0.05 to $3,400.

But why? Simply because people want to own bitcoin due to its attractive features….

First, each bitcoin is divisible into 100,000,000 pieces. This makes it an excellent form of money and is one reason it’s so valuable.

Second, bitcoin is easy to transfer. You can send $100 as easily as you can $100 million. There are no middlemen. Transfers are conducted directly from one party to another. You can store $1 million in bitcoin in a flash drive in your pocket or even on a piece of paper.

Thirdly, Bitcoin is liquid, meaning you can change large sums of it into cash or other assets… all over the world.

Another important reason bitcoin has value is that it is scarce. There will only ever be 21 million bitcoins and no more.

It is also secure and time-tested. Malicious actors have been trying to hack and disrupt the bitcoin network since its inception.

They have failed.

To top it all off, bitcoin is decentralized. The network runs on hundreds of thousands of computers all over the world. This means it would be extremely hard to shut down or block. Plus, it’s not vulnerable to the whims of bankers or governments.

We have all the hallmarks of an excellent currency here. To recap, bitcoin is…

• Transferable
• Divisible
• Increasingly valuable
• Scarce
• Secure
• Decentralized.

Increasing Awareness

The ultimate signal that bitcoin has value is the number of people who believe it does. And this number is growing rapidly every day.

For example, the largest bitcoin exchange, Coinbase, reported 1 million new accounts in June.

Clearly, demand for this digital asset is growing fast.

Yet I suspect many of you are still skeptical about cryptocurrencies – as you should be.

We’re still very early on in the game here…

Far less than 1% of the world’s population own any bitcoin at all.

I’ve owned it since 2013, so I’ve been on the roller-coaster ride for quite a while now.

I know what will happen as the number of bitcoin owners continues to increase…

The price will keep rising. It’ll be volatile at times, but that’s to be expected.

The secret to bitcoin’s success is this: viral organic growth. In other words, it spreads naturally from person to person, “infecting” new users at an exponential rate.

And like most bitcoin believers, I’m not looking to sell for a quick buck. I’m a holder who believes we have only just scratched the surface.

Bitcoin is unlike anything else the world has seen before.

It will continue to defy expectations. So if you’ve been on the fence for a while, as the price continues to rise, why not buy a small amount?

If you’re looking for guidance, my research service, First Stage Investor, has just released a full cryptocurrency package to its members. It includes four cryptocurrency recommendations and full details on how to securely buy bitcoin and three other rising superstar coins.

It includes everything you need to get started. Where to buy, how to buy and, importantly, how to keep your coins secure.

The risk-reward here is off the charts. I strongly recommend taking a look at our presentation. To access the presentation, click here now.

Good investing,

Adam

P.S. Please join the conversation by sending your questions and comments about bitcoin and cryptocurrency to mailbag@oxfordclub.com.