Three Facts Every Bitcoin Investor Must Know

▲ Bitcoin (BTC), U.S. Dollar (USD) ©

Bitcoin (BTC) has plunged 46% from its recent peak, exhibiting extreme volatility, but an analysis suggests that its three core strengths—fixed supply, overwhelming long-term returns, and flawless security—remain intact, potentially presenting a buying opportunity.

According to investment media outlet The Motley Fool on February 14 (local time), the first key factor Bitcoin investors should understand is its scarcity, capped at 21 million coins. This absolute limit, embedded in its software to reduce new supply through halving events, ensures a predictable inflation rate. This stands in stark contrast to fiat currency systems, whose value is eroded by ever-increasing government debt and monetary expansion.

The second factor is its overwhelming historical returns. Data from asset manager BlackRock show that Bitcoin outperformed all other asset classes over the 11 years from 2013 to 2023, and surged 120% in 2024 alone. Once dismissed as a worthless internet currency in its early days, Bitcoin has skyrocketed 17,000% over the past decade, evolving into a globally recognized asset.

The third strength is its unwavering network security, maintained despite numerous adverse events. In January, Bitcoin marked the 17th anniversary of the first block being mined, and throughout its long history, the blockchain has never been hacked.

This achievement stands out even more when compared to major failures within the cryptocurrency industry. Incidents such as the Mt. Gox exchange hack and the collapse of FTX in 2022 due to the misuse of customer funds severely undermined investor confidence. However, the Bitcoin network itself endured these trials and demonstrated remarkable resilience.

The outlet advised that although Bitcoin is currently trading at nearly half its all-time high, investors who clearly understand its proven fundamental strengths may view the current volatility as a smart opportunity to rebalance and strengthen their portfolios.

Disclaimer: This article is for investment reference only and we are not responsible for any investment losses resulting from its use. The content should be interpreted for informational purposes only.