You may not know this, but the federal government is not a fan of bitcoin.
In 2012, the U.S. Attorney’s office asked a federal prosecutor to look into shutting down the cryptocurrency before it could take off.
But Katie Haun, the prosecutor tasked with taking down bitcoin, said there was no way for the U.S. Department of Justice to do it:
“It would have been akin to saying ‘let’s go prosecute cash.’”
The government isn’t a fan of bitcoin and other cryptocurrencies because it can’t regulate them.
Its attempt to halt bitcoin’s rise failed then. And just as President Donald Trump aimed his 2021 budget at stymieing bitcoin, it will fail again.
Bitcoin Gets You Out of the Authority Bubble
One reason bitcoin got so popular wasn’t because hackers working nefariously in their dark basements wanted to buy things on the darknet.
Computer operators wanted a way to grow their wealth without being over-regulated by the government.
You need to understand that bitcoin has no central authority and doesn’t run on the traditional financial system.
It runs on a voluntary network of thousands of computers around the world.
Governments have no way of shutting down this network without shutting down the entire internet and keeping it off.
And that’s just not going to happen.
The Rise of Bitcoin
When bitcoin was first introduced to the currency market in 2014, it was slow to take off.
A lot of that was because investors had no idea what to make of it.
In 2017, however, the price of bitcoin skyrocketed from $1,000 in January to near $20,000 in December, buoyed by bullish investor sentiment.
Bitcoin Is Making a Comeback
The 1,800% jump came despite the government’s best efforts to crack down initial coin offerings (ICO) and reject a cryptocurrency exchange-traded fund (ETF).
A main reason is that investors saw bitcoin like gold — a good safe haven against stock market fluctuation and the devaluing of the U.S. dollar.
That will play a part in bitcoin’s next rise.
Trends Show Bitcoin Jumping Again
As you can see in the chart above, the price of bitcoin jumped significantly:
- The price spiked 1,800% in 2017.
- In 2019, the price jumped 233%, from $3,600 to above $12,000.
The current price trend shows another jump on the horizon.
Earlier this year, bitcoin tested a recent low around $5,000 in February. Since then, it has risen 80% to come close to the $10,000 mark.
The big reason: stock market volatility.
Market indexes dropped more than 36% in March, pushing investors into safe havens such as gold and bitcoin.
And that volatility isn’t going away.
But there are more reasons bitcoin is a good investment now and in the future.
Avoid Government Intrusion
Just like in 2012, the government is taking aim at cryptocurrencies.
All because it can’t control them.
In his 2021 proposed budget, Trump proposed moving the Secret Service back to the Department of the Treasury. The idea is to use the Secret Service to investigate how cryptocurrencies are used by criminal organizations.
But bitcoin’s rise is not because of some underworld criminal organization using it. It’s because of what the government has already done.
You see, the Federal Reserve’s recent action — namely printing more money to help the economy — devalues the U.S. dollar.
When the dollar loses value, you lose buying power.
But with bitcoin, you aren’t subject to unsound banks, heavy regulations or even theft.
And since we are in the midst of an economic crisis, the value of bitcoin is only going to rise.
As an investor, now is a good time to own bitcoin.
It protects you against market volatility — as well as stringent government oversight.