Currently worth more than $2.3 trillion, the cryptocurrency market has certainly caught the attention of the investment community, particularly those looking to score huge gains. Prices have soared in the past year and a half, after they dropped precipitously in 2022.

If you're looking to gain exposure to cryptocurrencies in your portfolio, it's best to keep things simple and focus on the most valuable digital asset out there. It shouldn't be a surprise that I'm talking about Bitcoin (BTC 4.19%).

Here's why it's the ultimate cryptocurrency to buy with $1,000 today.

A special asset

Bitcoin is a breakthrough technology; never before could someone send money to someone else anywhere in the world digitally without the use of an intermediary. It is essentially a decentralized monetary network. This means that it competes directly with central banks around the world.

Investors who want to own an asset outside of the troubled financial system flock to Bitcoin. The purchasing power of the U.S. dollar, the world's reserve currency, has tanked more than 95% in the past 110 years. In more recent times, the country's debt balance and underfunded liabilities have ballooned. We are quite literally on an unsustainable monetary path.

This proves why Bitcoin has value, something many people still struggle to understand. Bitcoin has a fixed supply cap. There will only ever be 21 million coins in circulation. This hard cap is etched in its software code. And unless they want to undermine the entire network, the majority of nodes won't agree to change these rules.

This setup is completely different from other assets. Companies can issue more equity. Governments, especially the U.S., aggressively raise and create more debt that results in the money supply going up over time. Even gold, what many consider the ultimate store of value, sees its supply rise.

This underlying structure of a fixed supply cap partly helps explain why Bitcoin's price has skyrocketed more than 132,000,000% since July 2010 (the earliest data available on coinmarketcap.com). In fact, in eight of the past 11 years, Bitcoin has outperformed every single asset class. That's a phenomenal track record.

The approval and remarkable early success of Bitcoin spot exchange-traded funds (ETFs) proves that demand for this type of asset is strong. I firmly believe that education is the key factor that will unlock even greater price appreciation for Bitcoin. As more people learn more about it, understanding how it has advantages over the current financial and monetary network, demand will go up.

Buy the dip

As of this writing, Bitcoin's price is about 13% off its peak, which was just reached in March. I think this presents an attractive entry point for investors to put some money to work.

But I can understand if you're hesitant to buy when there's a lot of bullish sentiment. If this is the case, then perhaps you should consider dollar-cost averaging that $1,000 over several months to buy at different price points.

It's critical that investors don't view Bitcoin as a get-rich-quick scheme. This is an asset you should plan to own for at least the next 10 years. This ensures that you're able to focus on the factors that matter most to Bitcoin's rise, like favorable regulation, greater portfolio adoption, and perhaps progress toward becoming a popular medium of exchange.

These things will take a long time to play out -- assuming they do. Adopting a long-term mindset will help you cope with the extreme bouts of volatility along the way.

That $1,000 has the chance to be worth significantly more well into the future.