Digital assets, and primary cryptos, are still pretty fragile, as many things can affect their worth. Now, Bitcoin is a globally accepted crypto and is probably the least influenced by what’s going on in the world or what Elon Musk tweets, for example.
Yet, depending on what that tweet is about, it can still cause certain market changes. The role of social media is much higher than anyone could possibly imagine, and if you don’t believe that, make sure to check this piece about it at gazette.com.
On the other hand, perhaps the best way to determine their influence is to check how much money is flowing into the crypto world, so let’s get into details.
Calculating the worth of Bitcoin
Since BTC is the most popular and many know about it, we will start by calculating the worth of all BTCs currently in circulation. It can be pretty challenging because its price varies and fluctuates all the time, which means that it changes in a day, and finding the real worth of it is not easy.
That does not mean that it is impossible and that it is unknown because we actually know the approximate value. But that’s the thing, as it’s only approximate, meaning that no one can say for sure its value because of all ups and downs, as after a few minutes, that info can become a piece of old news.
A few months ago, or better said, three months ago, it was about one trillion American dollars based on the price of Bitcoin at that time, which is a pretty high amount of money. On the other hand, you probably know about that guy who ordered a pizza and paid with BTC, and if he believed in it just a little more, he would become a billionaire.
That’s perhaps the best example of how time and patience are of vast importance with digital assets, and also why it is still a pretty challenging thing to calculate the total worth of some crypto.
Besides Bitcoin, we have many other coins that cannot be overlooked because their worth, along with Bitcoin, is about $2.5 trillion, which is one and a half times more than Bitcoin.
There are many of them, and the choice is pretty enormous when it comes to choosing the one to use, and there is the perfect one for each person in the world. Compared to all the narrow money in the world, the value of all cryptos is 7% of it, and it is expected that this percentage will only increase in the future.
As for the reasons why even fiercest doubters now agree with this claim, mainly that’s because just like we evolve, so does the technology we use. Today, digital money represents something that will be our future money, meaning that cryptos will stay with us for quite some time.
Furthermore, that also says a lot about the future of BTC, as even though there are thousands of new coins on the market and regardless of what will happen to Bitcoin, it will always be used and have value because it is the first crypto, the one responsible for this financial revolution.
Cryptos vs. narrow money
What is even harder to determine is the amount of narrow money. The main reason is the fact that we have a lot of different fiat currencies in circulation worldwide, precious metals, along with the one thing people often forget about, and it’s about how we also need to take into count debts and banknotes, and doing all that can be pretty challenging.
On top of all this, there are many lost items and banknotes, and even though we don’t know where they are, we still need to count them too. Now, the last try to calculate the value of all money in the world was about a year ago, and it was estimated that it is about $35 trillion, but it also included cryptos meaning that they also have a huge role in all that. Since people are using cryptos more and more, the only right thing to expect here is that the overall amount and percentage of total money used in the world will only go up.
Cryptos compared to gold
Gold is the to-go option for many, as it has a certain value that will never experience sudden rises or drops, unlike cryptos. Furthermore, for centuries, gold has been used as a way to express wealth and stability, and as such, plays a huge role in our world.
Besides the narrow money, another popular way to keep wealth is gold because it is considered as one of the safest ways to keep the wealth since its price is not fluctuating and does not vary often.
Although it is not easy to estimate the value of gold because it was mined for a long time, and there are a lot of tones mined, at the end of 2019, it was estimated that it was about $12 trillion. The value of all cryptos is about 10% of all gold in the world, and if it continues to grow, that percentage will get much higher pretty soon. On the other hand, gold is still mined today, and it will probably never stop, but at a much lower rate than cryptos.
It was just a matter of time until people responsible for some payment system decided that adding cryptos, and by that, we here think about Bitcoin, is the next logical step. The first one doing so was PayPal, an online payment system people around the globe use, which opened the door to other systems also adding BTC to their offer.
But, the importance of this action is much larger, as it was a clear sign for everyone that cryptos are now accepted worldwide and that people don’t need to be afraid to use them and invest in them. As you know, many things influence the value of cryptos, and this action by PayPal was one of the most important so far.