By the end of 2020, the bitcoin market is going crazy. On December 27, the price of bitcoin broke through $280 million at one time, reaching a record high of $28365 per piece, a new high in the market value since its birth more than 10 years ago. Bitcoin has risen more than 233% this year. Bitcoin broke through 20000 US dollars before, and public opinion was full of hot pot. Now it has soared to 28000 dollars. It is crazy again. The total market value has exceeded 500 billion US dollars, which is equivalent to two universe lines, which is 1 trillion higher than Maotai. Bitcoin can’t eat or drink, and it doesn’t create profits. All of these are so valuable. What are the reasons for the sharp rise? Should we hold bitcoin? 1、 With the impact of the epidemic, the US Federal Reserve has released a lot of water, and the rationality of bitcoin’s rise is just at the right time. The US Federal Reserve’s massive release of water has led to the spread of the epidemic in Europe, the virus mutation, and the rising global risk aversion mood. You can see that there is no commodity that doesn’t go up all over the world, and gold may now be at a new high. Because of the loose currency, there is always a stable thing to replace the loose currency. In addition to gold, a globally recognized “safe haven”, bitcoin has also won “good timing.”. Let’s take a look at the comparison between the dollar index and bitcoin I made on October 1, this year. At that time, bitcoin price was $10800, and the dollar index was 93.8. That is: when bitcoin was born, the dollar index was low. The dollar index was falling a few months before bitcoin’s first bull run. The dollar index was falling months before the peak of bitcoin’s second bull market. The dollar index was falling a few months before bitcoin’s third bull market peak. On the contrary, in bitcoin’s three bear markets, the dollar index is rising. Is this a coincidence? Or is it a struggle between the old and the new? However, if you want to say that bitcoin has threatened the US dollar, that is a joke. Cryptocurrency is still hyped at present, which does not mean that it is always the case. The global financial crisis, economic crisis is inevitable, and the scarcity, unforgeability, anonymity (illegal use) of bitcoin determine that it will rise now, and all rationality is just at the right time. It can be said that the future trend is that bitcoin will not stop rising until the money printing machine stops. 2、 Review why bitcoin was born? The essence is the machine that makes credit. Let’s review the history of bitcoin. In 2008, the financial crisis caused widespread panic and anxiety. In order to resist inflation, Nakamoto proposed the concept of digital currency in 2009. In October 2009, when the first bitcoin was announced, the exchange rate was only 1 US dollar to 1309.03 bitcoins, which can be said that everyone can afford it. However, when Nakamoto proposed this block, the following sentence was written on coinbase: the times 03 / Jan / 2009 Chancellor on brink of second bailout for banks. On January 3, 2009, the chancellor of the exchequer was on the verge of implementing a second round of bank emergency aid. That’s the headline from the times of the day. Genesis block is the first cry of bitcoin, which also announces why bitcoin was born. The logical basis of bitcoin comes from economist Hayek’s book “the non nationalization of money” in his later years. He put forward: if competition is introduced into the currency, free competition is introduced, instead of each country proposing an exclusive legal tender, is it more conducive to maintaining the currency price at a most stable value? Whether the government’s monopoly on issuing currency will manipulate money to seek private interests, and then force the masses to accept it through law, so as to reduce the efficiency of social operation, and then lead to certain economic problems. Private coin issuing is a way to introduce free competition, but private credit is lower and people can’t accept it. It happens that the blockchain is the machine that makes credit, which perfectly solves the impractical part of Hayek’s theory. 3、 Bitcoin is sought after, but we have to face up to the high risk hidden behind it. Undeniably, currency digitization has become an inevitable trend. Investors’ demand for gold is gradually being squeezed by bitcoin. As an equally excellent value storage tool, bitcoin is being recognized by more and more institutions and financial giants. At present, the most popular topic on Wall Street is the wind direction change of gold and bitcoin. However, even if bitcoin becomes more and more popular, we have to face up to the high risks behind it. The value of bitcoin fluctuates, and it has become the norm to rise and fall sharply. Behind the myth of sudden wealth, there are many tragedies of returning to poverty overnight. Greater trading leverage, more volatile price range, and the fact that investors are often not rational when they enter the bitcoin market are all huge risks. Although bitcoin’s rise is encouraging today, we have to make a number of trade-offs. The result of blindly following the trend may be to bring amazing luck, or it may be to lose money. In particular, virtual currency transactions are not protected by law in China. Because the transactions often use foreign servers, the authenticity and security can not be guaranteed. Once fraud and illegal fund-raising can cause crimes and economic losses, it is difficult to safeguard rights. In short, if you really want to enter the market, it is suggested to ask yourself: how can you make money in this market? Is it because you know less than the old leek? Or is it because you never run out of luck? I think it’s better to work steadfastly. The rise and fall of the capital market are often accompanied by blood. What you can do is not to become fuel!