With its introduction in 2009, Bitcoin (BTC 1.24%) ushered in the cryptocurrency era, helping some early adopters achieve enormous wealth and leading to some speculators surely going broke. Since then, digital assets, and Bitcoin in particular, have increasingly become a popular investment vehicle for many individuals and institutions. 

Even some well-known billionaires, including MicroStrategy Chairman Michael Saylor, Tesla Chief Executive Officer Elon Musk, and Dallas Mavericks owner Mark Cuban, own some Bitcoin. And here's why you should, too. 

Bitcoin has been one of the best-performing assets 

Since April 2013 (the earliest data provided by coinmarketcap.com), Bitcoin has produced a monster return of over 15,000%, despite being down 57% in 2022. This performance crushes the S&P 500, which generated a total return of 191% during the same period. 

As of this writing, Bitcoin carries a market cap of just under $400 billion, easily making it the most valuable cryptocurrency out there. And this is precisely why it is usually an investor's first stop in the world of digital assets. 

Whereas another top cryptocurrency, Ethereum, receives a lot of attention thanks to its smart-contract functionality and the recently completed "Merge," which gives this blockchain promise for disrupting numerous industries and bring about real utility, Bitcoin was simply created as a peer-to-peer electronic cash system. And while this might seem boring in the exciting and fast-paced crypto space, Bitcoin itself has some incredible potential. 

Despite a recent history that has been full of extreme volatility, I think Bitcoin has a bright future. 

Bitcoin has unreal potential 

Up to this point, Bitcoin has really only been used as a store of value, meaning that both individuals and institutions hold it with the hopes that the price will go up over time. In this regard, Bitcoin is viewed by some as a digital version of gold. For thousands of years, the precious metal has been a popular asset to own in order to store wealth. 

But Bitcoin has better properties because the top crypto is more divisible, portable and can be used more easily in transactions than gold. Plus,  younger, tech-savvy people familiar with the internet may be more comfortable storing wealth in a digitally scarce asset like Bitcoin as opposed to gold. If Bitcoin even approaches half of the $12.5 trillion total value of gold on Earth, that would equate to a nearly 16-fold increase in market cap. 

While Bitcoin has sizable upside if it simply becomes more widely accepted as a legitimate store of value, the real potential comes from it becoming a medium of exchange, meaning Bitcoin could be used in transactions. Right now, the Bitcoin network can process less than four transactions per second (TPS), not even close to Visa's capacity of 65,000 TPS. But a scaling solution, known as the Lightning Network, is a promising development that makes transaction settlement instantaneous with virtually no costs. A lot of work still needs to be done for its adoption to grow, but the potential is there. 

However, day-to-day transactions aren't the only opportunity. A more realistic use case for Bitcoin as a medium of exchange has to do with settlements between governments, financial institutions, or corporations. When these large parties transact with each other, settlement can take days and involve multiple intermediaries. Bitcoin settlement takes 10 minutes, with the average transaction size being $65,000. What's more, there's no need for central authorities. Therefore, the speed to finality, coupled with the ability to handle bigger dollar values and facilitate a direct connection between opposing parties, makes Bitcoin appealing in this regard. 

Billionaires like Michael Saylor, Elon Musk, and Mark Cuban most likely understand the bullish arguments for Bitcoin, and that's why they own some. Individual investors should consider following in their footsteps.