Many people have heard the term called Bitcoin on media, but they actually do not know what exactly it is, or how it is tradeable. The derivative gained so much fame lastyear especially, when it was trading near the $13 mark, at year’s start, and touched nearly $1050 on 27th of November, 2017.

So what it is this Bitcoin? It is an alternative to all other forms of currencies and just like the currencies, it can also be traded anywhere in the world, and the supply is extremely restricted. The above definition of Bitcoin looks very much like the precious shining metal- Gold.

Then, it begs the question, why has Bitcoin been on the rise, while gold was trading in a completely opposite direction. Well for one, you have to be very brave if you want to buy gold, given that the two-year bull market is over. Moreover, inflation is subdued, and Federal Reserve bank in the US is looking to wind down their ultra-loose monetary policy, so it is more than likely that gold could continue its downward trend for some time unless inflation starts ticking up.

Moreover, analysts will argue that gold prices have been suppressed by the Central Banks around the globe, and if this manipulation would not have taken place, there could be a different story. As for the Bitcoin, it is very much like the “Tulip bubble”, which we experienced in the 17th century. But the reality is that there is certainly a demand for the alternative currency and Bitcoin is providing the answer for this now.

Unlike gold, Bitcoin does actually have a predetermined supply and manipulation for this derivative is not possible and storing cost for Bitcoin is far less than gold. We all know that more money is being invested in Bitcoin, as investors are looking for an alternative to gold, and Bitcoin is the answer, therefore, it may be safe to say that Bitcoin may be rising for some time and gold could continue its downward trend.

You may want to ask then, that who has invented this Bitcoin and what is the quantity of this? The answer is that no one knows that who has invented Bitcoin, and at the moment supply for this is controlled by the pre-determined algorithms. Currently, we have 11 million Bitcoin in circulation and the final figure will be near the 21 million mark.