Bitcoin more profitable: The world of digital currencies is dominated by bitcoin and most crypto traders have at least once invested in Bitcoin. Bitcoin was the first cryptocurrency which started the trend of virtual currency and, since then, millions of people around the world have invested in it and there are very few who ever had to face losses.
Well, Bitcoin is not the only digital currency that is profitable; there are many other cryptocurrencies traded in the digital currency market. This article will help you to understand the real reasons behind the potential in profitability capacity of Bitcoin over other digital currencies.
Price fluctuation and relief from taxes
Bitcoin price fluctuation is very high, the ups and downs are sometimes unpredictable, which makes trade interesting. The potential of making huge profits in a short period is actually something which gives an edge to Bitcoin over other cryptocurrencies.
The experts spend hours studying the Bitcoin price fluctuation and then come up with a pattern where selling or buying is profitable. Artificial intelligence tools like bitcoin compass help traders to know the right time to invest and make huge profits from price fluctuation.
The element of transparency makes Bitcoin more trustable in the eyes of investors, as the information is protected and remains secure in the blockchain technology. Secondly, the freedom to make payments helps Bitcoin holders to send and receive bitcoins at any place, anytime.
Bitcoin is backed by many financial institutes and multi-millionaire investors which gives it hype and recognition. As a result, the price of Bitcoin increases and attracts other investors to shift their money in trading Bitcoin.
There are various types of taxes charged on cryptocurrencies, whereas Bitcoin is totally tax free. Secondly, most of the other cryptocurrencies charge high transaction fees which hurts investors as the profit gets squeezed down. On the other hand, Bitcoin charges very low transaction fees which does not affect profitability much.
Why some traders invest in Altcoins instead of Bitcoin
The volatility of Bitcoin sometimes or its instability price keeps away those investors who prefer to invest in low-risk digital currencies. But as high returns are expected while trading Bitcoin, the level of risk is considerably high too.
As Bitcoin is backed by blockchain, it is claimed that recreation of blockchain is relatively easy, and that’s why few organizations come up with their own digital currencies. China, for example, has been claiming for the last few years that it is looking to launching its own digital currency.
Another reason is that altcoins serve as an alternative to bitcoin. Those investors who are not interested in bitcoin but want to invest in the market of cryptocurrencies move to altcoins. Few investors take altcoins as the next best option, such that if something went wrong with Bitcoin, altcoins investments would back it up.
Being the pioneer in crypto trading, Bitcoin has attracted multinational organizations and billionaires. This affects the profitability element in Bitcoin as the price goes up wherever any big company or billionaire investor announces investment in Bitcoin. Other cryptocurrencies are infamous and investment in other cryptocurrencies like cardano, polkadot and litecoin is comparatively less as compared to bitcoin.