The Best Way To Buy Bitcoin
There are lots of truisms in Bitcoin. One truism is that everyone thinks they’re late to the Bitcoin game, that they missed out on the big…
I updated this post on September 27th to update the numbers post the latest mini-crash.
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There are lots of truisms in Bitcoin. One truism is that everyone thinks they’re late to the Bitcoin game, that they missed out on the big gains:
Another truism, is that predicting Bitcoin’s price is pure folly. Bitcoin finished 2018 at $3,829 after “experts” had earlier predicted year-end prices that were 5X-25X that price:
And by the way, it’s not just the experts that are way off. Everybody sucks at predicting the near term price of Bitcoin:
Bitcoin was trading at $7,436
The third and final truism is the fact that Bitcoin is volatile:
https://bitvol.info/ 30-Day BTC/USD Volatility
Bitcoin is three times more volatile than the NASDAQ.
Given The Three Truisms, Stop Worrying About Bitcoin’s Price Today, And Start Stacking Sats … Daily (or Weekly or Monthly)
Because Bitcoin is so volatile, buying on regular intervals enables you to take advantage of the inevitable dips and crashes. That’s what Bitcoin does. It crashes. It’s volatile.
By buying at regular intervals, you take the emotions out of investing. By definition, investor euphoria peaks at the top. Your emotions tell you to buy more. And investor despair peaks at the bottom. Your emotions compel you to sell. So take your emotions out of the equation.
To see how the math works, let’s assume you started buying Bitcoin at the top, on December 17, 2017, when it was over $20,000. Now if you had bought just on that day, and held, you’d be down about 50%.
But let’s assume you bought $1,000 worth that day. And then the next day, and the next day, through today (September 27th). Per the chart below, you’d be up more than $153,000 (on a total investment of $650,000).
There Are Risks, But You’re Potentially Getting Well Compensated
There are certainly risks associated with Bitcoin. Most notably, in my view, is the risk of a better store of value coming along. There is obviously the simple risk of adoption. Right now, Bitcoin has a market cap of $185 billion, just a little more than 2% of the total “market cap” of gold. If Bitcoin is a better store of value, over time, it could exceed the market cap of gold. So while you could lose 100% of your investment, the upside is still (at least) 40X+.
Bitcoin has always been, and remains, one of the great asymmetric investments of all time. Meaning your potential downside is dwarfed by the significant upside potential.
So start stacking sats today. You haven’t missed it. It’s still just beginning.
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