What if I told you that it was possible to invest your hard-earned wealth in an asset that was well on its way to becoming universally recognized as the most desirable money humankind has ever seen? You would probably want to get some, right?
For the first time in history we have the ability to hold our time and energy in an asset that can’t be debased by corrupt governments and central banks. Bitcoin’s rise to relevance will continue to usher in advancements in human prosperity and productivity around the globe. This will enable countless people to get out from under oppressive currency controls and facilitate true free markets where Bitcoin is traded for productivity. In today’s world, government controlled fiat money is created out of thin air with no associated productivity and it mostly finds its way into the hands of relatively few. This has caused systemic imbalances throughout time, leading to much suffering and strife.
Bitcoin will change age-old dynamics in ways that are sure to bring humanity forward. There is a world in the not too distant future, where individuals, cities, states and even countries, settle their debts and are compensated for goods and services rendered, with one non-political, secure and global money. Ideally you would want to have some before the rest of the world catches on.
There will only ever be 21 million Bitcoin. With 8 billion people on the planet, that is .002625 Bitcoin (or 262,500 SATs) per person. Today about 100 dollars will buy you that. A satoshi, or “SAT” is the smallest unit of a Bitcoin. (100,000,000 SATs = one Bitcoin). You can buy fractions of a Bitcoin. A seemingly small amount, if accumulated upon, will likely be a small fortune in the coming decades. Steady accumulation is key. Changing your time preference will help. Saving for your future is now possible, independent of what the money printing governments of the world do.
We are still early into Bitcoin’s global adoption. That being said, you may not want to wait any longer. As Ernest Hemingway once wrote about bankruptcy, “It happens in two ways. Gradually, then suddenly”. The world seems to be waking up to Bitcoin’s benefits in such a fashion.
In the future, people like you, who get in early, will exchange their Bitcoin for useful goods and services, thus enriching other productive people and continuing the virtuous exchange of this near-perfect sound money.
Many factors will come into play when deciding how much you should invest in Bitcoin. It is important to look at what you are trying to achieve by investing in the first place. What are your particular goals for wanting to invest, or invest in Bitcoin, specifically?
Investing in Bitcoin, with the assumption that you buy and hold for the long term, offers all of the above benefits and more.
Investing in Bitcoin is an excellent way of preserving one’s capital for the long term. Many people today believe that it is the preferred savings tool in a modern day investment portfolio. Investing enables you to preserve your wealth so that the “future you” is safe and protected. Doing so will free up your time and energy going forward -- time that will let you do whatever it is you enjoy doing.
Prudent investors usually allocate 10-20% of their income to investments, with the goal of having their money work for them, compounding in value instead of depreciating due to inflation. It is important to look at your current expenses and liabilities and figure out how much you can afford to invest. Long term and sustainable growth through dollar cost averaging (DCA) is a safe bet when considering how much you are willing to deploy. You may want to explore your comfortability with managing your own investments and ask; do I want to be more in my approach? Finally, what is your understanding of Bitcoin and its inherent properties and risks?
Many people around the globe have found Bitcoin to be the most valuable money the world has ever seen. People with high conviction in Bitcoin usually choose to buy it when they can prudently afford to, and save it as you would any highly valued asset or collectible. They view Bitcoin as an expression of free-speech and self-sovereignty. Many people buy and hold, and do not sell. They use fiat money to pay bills and expenses but their personal is in Bitcoin. For you, Bitcoin could simply be another way to add diversity to your portfolio.
Bitcoin is a complex topic to digest. A fact to consider is that because Bitcoin’s supply is limited and it's programmatic issuance is decreasing into the future, any net new demand means the price has to rise. Investing in Bitcoin lets you store your time and energy in an asset that can theoretically rise in value indefinitely.
Dollar cost averaging, or DCA, enables you to purchase Bitcoin on a recurring basis, catching the lows, the highs and the middle as it steadily marches along its way towards global adoption. Most people don’t have the desire or time to monitor the markets for precise entry points, not to mention the possibility that your order at an may not even be filled during times of volatility. Starting in October of 2015, if you would have started investing $25 a week in Bitcoin, the value of your investment would be north of $220,000 today! The money you would have put in over that time is about $7,800. That is a 2,700% overall return on your investment and a roughly 450% yearly ROI!
When deciding where to buy Bitcoin, consider looking into Bitcoin-only companies. It can be difficult to distill the signal from the noise surrounding cryptocurrencies in general. Large exchanges promote all kinds of tokens and coins in the hopes that you will buy, sell and trade them. These exchanges make profits from these trades and don’t necessarily stand behind the merits of any particular project. The benefit of a Bitcoin-only service is that you can be sure you are getting all the relevant information and tools needed to make informed decisions on your journey investing in Bitcoin. You aren’t going to be spammed with advertisements for other projects. There is something to be said about the integrity of a company that stands behind a new monetary asset that is accessible to all, launched organically over a decade ago, and has grown entirely out of people opting in because they believe that it may help change the world for the better.
Ultimately, deciding if Bitcoin is a good investment for you, how much you want to invest, and the strategy by which you choose to accumulate is a personal and oftentimes, collaborative procedure. Especially if you have a partner or family with whom you would like to keep informed. At the end of the day, by choosing Bitcoin, you are opting into the most robust and only truly money in existence. Many other cryptocurrencies claim to mimic Bitcoin’s merits but they simply cannot compete when compared. No other cryptocurrency has yet to achieve the network effects, absolute scarcity, and sufficient decentralization that the world has come to desire in a global and digital currency.
How much you choose to invest in Bitcoin will be a personal choice and there is no harm in starting off small as you grow your understanding of the attributes of this revolutionary new form of money. Getting off zero and keeping the ball rolling with DCA is a great way to build conviction and reap the enormous benefits as the world continues to wake up to Bitcoin.
