The Investors Delight: When To Invest In Bitcoin
Understanding
the Market
Cryptocurrency adoption is going much
slower than most would have predicted. While owning cryptocurrencies is easier
now than ever before, using them is about as difficult as ever, with only a
handful of places accepting each individual cryptocurrency.
This leads us to a market that is, in
essence, an investors market. While there’s a lot of potential for widespread
adoption – and in fact, widespread adoption is more of a when than an if at this
point – right now people don’t buy cryptocurrencies to spend them. They buy
them to park them.
That doesn’t mean nobody spends crypto
– the crypto market is actually thriving, but since opportunities to spend
crypto are low even inside blockchains, the amount of people actually using
their crypto is dwarfed by the amount of people using it as investments or for
day trading.
And that’s because, in essence, the
crypto market these days is basically a stock market.
Recent History
Bitcoin recently went through
another bull market, bringing its value above the $13,000 mark for the first
time in a year and a half. It then plummeted under $10,000 as quickly as it
went up.
It’s easy to see why crypto
investments are seen as unsafe, considering the unstable market. After all,
stocks don’t usually display record peaks and price plummets within the same 24
hours – usually things go one way or the other.
A Strategy To Adopt
The truth about Bitcoin is that
investing is only wise if you’re in it for
the long game. Bitcoin’s peaks and valleys are huge enough to make the
news, but they don’t happen every other week.
Yes, some people have seen their
investments multiply tenfold – but most of these people waited years for that
to happen.
They waited through peaks and valleys, through rushes and droughts –
mostly because they know that once a bull market starts it’s already too late
to invest.
Last month, those who bought Bitcoin
when it hit the $3000 mark in 2018 reaped the rewards of their patience.
Meanwhile, most people who bought it during the gold rush of late 2017 ended up
losing their money.
Sure, they invested under the impression – largely spurred
by crypto fans – that BTC would reach $50,000 within a year, but that matters
little in the end: It didn’t happen.
Last Line
In other words, while Bitcoin is
volatile, there are ideal moments to invest and not to, as happens with every
asset.
Now, the question is – should you go all in and make an all-crypto
portfolio? You should stay abreast with the market, buy the dips and sell the tops as prices surge.
There is never a guarantee that as prices rise, that it will continue. But we know that as prices drop, there is a chance for it to rise again.
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