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WHAT MAKES CRYPTOCURRENCY GAIN VALUE?

When it comes to any type of money, value comes from scarcity. If gold were extremely common, it wouldn’t command half the value and prestige that it does in our world.




HARD TO GET, EASY TO SPEND


Cryptocurrency takes scarcity into consideration from the very beginning. Take bitcoin for example: Only a maximum amount of 21,000,000 can ever be generated through mining.


WHAT IS CRYPTO MINING?


The codes behind a cryptocurrency set the number of coins that can be generated from the start, but accessing these coins requires decrypting extremely complex codes. The process requires an intense amount of computer power and energy use, so the very act of obtaining new coins is extremely costly. These up-front costs plus scarcity help create the value.

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