$100k Bitcoin đ It's Not Just Because of Elon or Trump
Bitcoin's price moves in 4 year cycles irrespective of leadership
Thereâs been a lot of chatter about why Bitcoin is hitting new all-time highs. Some people think itâs because Donald Trump has shown some support for crypto, or because Elon Musk created a âDepartment of Government Efficiencyâ and named it Doge. But let me tell you, if youâre buying into these theories, youâre not digging deep enough to understand Bitcoin truly.
Itâs not about hype or headlines. Bitcoinâs price movements are part of a much bigger picture - one that requires a little effort to wrap your head around. Letâs break it down.
The Basics of How Bitcoin Works
First, understanding Bitcoin starts with grasping how the blockchain works. Bitcoin isnât just some magic internet money. Itâs built on a decentralized ledger - a blockchain - where transactions are recorded in blocks.
Miners are the ones who add these blocks to the chain by solving complex cryptographic puzzles. This isnât guesswork; itâs a computationally intensive process that ensures the network remains secure and tamper-proof.
But hereâs the kicker: Bitcoin has a fixed supplyâ21 million coins. Thatâs it. No one can print more Bitcoin out of thin air, unlike fiat money (which weâll get to in a moment).
The Broken Financial System
To really appreciate Bitcoin, you need to understand how flawed our current financial system is. Inflation, for example, is a stealth tax that eats away at the value of your money. Central banks âprint moneyâ like itâs Monopoly cash, devaluing the currency and making everything more expensive over time.
Bitcoin, on the other hand, is deflationary. Its supply is capped, and the process of releasing new Bitcoin slows down over time. Thatâs what makes it so revolutionary. Itâs not just an investmentâitâs an entirely new way of thinking about money.
The Four-Year Bitcoin Cycle
Now, letâs discuss Bitcoinâs price cycles. This part fascinates me because itâs incredibly consistent. Every four years, or after 210,000 blocks are mined, a Bitcoin halving occurs.
During a halving, the reward that miners receive for adding new blocks to the chain is cut in half. This reduces the supply of new Bitcoin entering the market, which historically drives up the price.
Right now, weâre in Bitcoinâs fourth halving cycle - or its fifth epoch, depending on how you count it. These cycles have been remarkably predictable, and if history is any indicator, this current cycle could still have a lot of room to grow.
Why Bitcoin Is Valuable
Beyond its limited supply, Bitcoinâs value comes from its unique monetary properties. Itâs durable, easily verifiable, divisible, and stored in a decentralized way on the blockchain. Every transaction ever made with Bitcoin is recorded and accessible, which means no central authority can mess with the system.
And letâs not forget: there will only ever be 21 million Bitcoins. The last Bitcoin is expected to be mined in around 40 years. This scarcity is a huge part of its value proposition.
The Bottom Line
So, the next time someone tells you Bitcoinâs price is up because of a tweet or a political statement, challenge them to dig deeper.
Bitcoinâs story is about much more than hypeâitâs about fixing a broken financial system and creating a decentralized future. And if you take the time to learn how it works, youâll see why so many people believe itâs the most important financial innovation of our time.