
Not so long ago, cryptocurrency was a term known by few, and understood by fewer. Just a decade or so after the invention of Bitcoin, however, the phenomenon has become mainstream, with digital assets trading for tens, or even hundreds, of thousands of dollars.
So, exactly what’s behind this surge in interest? Let’s take a look at several crucial factors.
The simplest explanation for the rise of crypto is that it’s self-reinforcing. As media attention is given to the surging price of Bitcoin, more people are made aware of what Bitcoin is. A few of these people might go on to learn about it in depth, and even invest in it. This pushes the price up further, which generates more media interest.
Endorsements from influential people like Elon Musk, Reese Witherspoon, and Matt Damon have variously helped to draw attention to digital assets in general, and often to particular kinds of them.
Crypto is, for the most part, a male phenomenon. It also tends to be disproportionately bought by younger people, who are more likely to be technically literate. There are also ideological reasons to prefer this type of currency.
However, it’s worth considering that older people tend to have more money to invest. We’ve also seen plenty of retirees seeking to get into crypto in order to diversify their portfolios.
The proliferation of crypto-trading apps has helped to reduce the barriers to entry for would-be investors. But it isn’t just your phone that can help you to access these assets – Bitcoin ATMs are now to be found across the country, helping to streamline the exchange of digital assets for cash, and vice versa.
The easier that the federal government makes it to invest, the more adoption we’re likely to see. The Trump administration has made moves in this direction, with the establishment of the Strategic Bitcoin Reserve and the signaling of a crypto-friendly regulatory environment.
We’re also seeing technical trends that might help to push crypto further into the mainstream. Stablecoins, which are tied to the price of fiat currencies like the dollar, are likely to be increasingly popular as traders seek to move their wealth frictionlessly from one part of the world to the next.
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Disclaimer: Analytics Insight does not provide financial advice or guidance on cryptocurrencies and stocks. Also note that the cryptocurrencies mentioned/listed on the website could potentially be scams, i.e. designed to induce you to invest financial resources that may be lost forever and not be recoverable once investments are made. This article is provided for informational purposes and does not constitute investment advice. You are responsible for conducting your own research (DYOR) before making any investments. Read more about the financial risks involved here.