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● Gold Corrodes, Bitcoin Surges

Bitcoin: Transformation into Digital Capital and Interpretation by Investment Principle

If you've ever been curious about Bitcoin or wondered what perspectives are advantageous for long-term investment, this article is worth your attention.

Today's content includes the evolution of assets through digital transformation, universal investment criteria that investors must consider, why Bitcoin is a more attractive asset than gold, and a comprehensive overview of Bitcoin's major history over the past 14 years.

As it summarizes the latest investment trends, global economic trends, and future prospects of Bitcoin, reading to the end will surely make you realize why Bitcoin is another long-term growth opportunity.

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1. Re-establishing Investment Principles: Priorities in the Digital Age

• Long-Term vs. Short-Term Investment
  
  As the economic environment changes, pursuing quick profits becomes increasingly disadvantageous. Looking at traditional indicators such as economic growth rate, inflation, and interest rates, assets that grow in the long term are ultimately the winners. Bitcoin has maintained an upward trend for 14 years despite temporary fluctuations.
• Capital vs. Currency
  
  Currency is vulnerable to inflation. On the other hand, Bitcoin has a limited total supply of 21 million, increasing its scarcity over time. It is solidifying its position as “digital gold” as time goes on.
• Perishable Assets vs. Permanent Assets
  
  Physical assets are subject to value decline and depreciation over time. However, Bitcoin is digital, eliminating concerns about physical damage, and its existence solely in code ensures permanence.
• Local vs. Global Assets
  
  Real estate and local businesses are heavily dependent on the local economy, leading to liquidity deterioration during economic downturns. Bitcoin is recognized for its same value worldwide, and blockchain technology enables borderless transactions.
• Physical vs. Digital Assets
  
  Traditional assets require various costs and efforts for transportation, management, and proof. Bitcoin is an online asset, making it easy to move and significantly reducing transaction costs.
• Mass Production vs. Limited Supply
  
  Raw materials and cash can continue to be produced, but Bitcoin’s supply is algorithmically limited, eliminating inflation risk. This is the driving force behind price increases.

2. Bitcoin’s ‘Superiority’: Why is it better than gold?

• Limited Supply
  
  Gold is scarce, but it is still mined at a rate of 1-2% per year. However, Bitcoin’s mining schedule is predictably designed according to the halving policy, with mining expected to end completely around 2140.
• Transportable & Digital Native
  
  Gold is physically difficult to move and trade. Bitcoin can be moved with a single click on the global network. Blockchain technology also allows transparent tracking of who traded.
• 14 Years of Weaknesses and Strengths
  
  Since its emergence in 2009, it has overcome numerous crises – exchange hacks, regulations in various countries, and the emergence of competing coins. Even after the surge and fall in 2017, it renewed its all-time high in 2021. It has solidified its position as a ‘digital safe asset’ during traditional market crises.

3. Market Valuation: “Price is not arbitrary”

• Bitcoin’s value may be subjective, but the trading price in the market is determined by the supply and demand of global market participants. This market price is an objective signal.
• The data from the past 14 years shows that Bitcoin has gained credibility as an asset, not just a trend.
• In a complex economic era that requires new growth engines and emerging investment destinations, Bitcoin has become ‘a new generation of capital.’

4. Digital Transformation and the Future of Bitcoin

• Investment criteria are changing due to global digitalization. Sticking to existing assets alone may result in missed opportunities.
• Full-scale competition between Traditional Finance and Decentralized Finance (DeFi) is expected in the future. Bitcoin is at the center of it.
• Ignoring Bitcoin in a long-term investment portfolio means failing to understand the new capital flows.

< Summary >

Bitcoin is advantageous as a long-term investment asset due to its limited supply, permanence, global accessibility, and digital native nature.

Bitcoin is highly likely to replace the role that gold played in the past in a digital trend environment.

Looking at market value and the actions of global economic participants, Bitcoin is a new asset paradigm.

Bitcoin is more competitive than existing physical assets and cash from a long-term investment perspective.
With the stability guaranteed by blockchain, its position in the global economy, and the characteristic of limited supply, Bitcoin is emerging as the representative of digital assets.
Now is a time of global economic transition, and it is playing a key role in the shift in the wealth management paradigm.

[Related Articles…]

• Bitcoin’s 2024 Price Forecast and Long-Term Investment Strategy
• The Future of Digital Assets and Global Economic Changes in 2024

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