Bitcoin is a cryptocurrency that was created in 2009, and in recent years its value has surged.
Bitcoins can be used to buy merchandise anonymously. In addition, international payments are easy and cheap because bitcoins are not tied to any country or subject to regulation. Small businesses may like them because there are no credit card fees. Some people just buy bitcoins as an investment, hoping that they’ll go up in value.
Sometimes it's hard to tell whether Bitcoin is more like Ponzi scheme or a pyramid scheme. Whatever it is, though, it isn't a currency. It's a tech stock.
The catch-22 is people buy Bitcoins because they think the price will go to infinity and beyond once everybody uses them, but they don't spend their own Bitcoins because they think the price will go to infinity and beyond once everybody else uses them. And so nobody uses them. But if nobody uses them, then the price will stay stuck at something a lot less than infinity let alone beyond. So the Bitcoin faithful have tried to not only convert people, but also convince them to martyr themselves, financially-speaking, for the crypto cause.
But some have defended the value of bitcoin against its critics.
Bitcoin is not any sort of investment scheme. Rather, it is a decentralised currency system which requires proof-of-work in order to mint new bitcoins... Bitcoin cannot be a Ponzi Scheme, pyramid scheme, etc., as there is no person at the top that is defrauding those who have converted other currencies into bitcoin.
Bitcoin does represent inherent value. Each bitcoin added to the blockchain represents proof of work. The system used in Bitcoin to decide the amount of mining power each user in the network has. Proof of Work (or POW in short) states that the more computational power you own, the more mining power you will have in the Bitcoin network.
And believe its immense value in cutting out a middleman will likely be the future of currency.
Bitcoin has shown that it is possible to use a network of computers, connected via the Internet, to build and maintain a set of valuable shared data—in this case a ledger of account balances that prevents counterfeiting—without the need for a trusted authority. Think about that: from a bunch of anonymous computers that have no reason to trust one another, an ironclad network has emerged that can support a whole currency. Literal money—what could be a more valuable target for hacking or compromise? And yet there it stands, unperturbed amid the chaos of the Internet.