Should I Invest in Bitcoin?
Should I Invest in Bitcoin?
It’s a good question and one that would be extremely hard to answer right now with the current state of the market.
Not to mention the hype and propaganda that is going around at the moment. Having just had the biggest rallies that the cryptocurrency world, no the whole world has ever seen.
No one would blame you also with all of the talk about the cryptocurrency bubble and that this is the same as the Tulip craze of the 19th century.
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Is Cryptocurrency a Bubble?
Is bitcoin a $200B bubble that is just about to come crashing down or is this the rise of the next global currency?
Well I will tell you right now I don’t have the answer and I can promise you that no one does either. The best gurus on finance, cryptocurrency, the internet or anything else don’t have any idea where this is going to go.
The facts are that Bitcoin is doing things that some people expected and others didn’t. So let’s not talk about the hype and let it get the better of us let’s talk about the facts without making unsubstantiated claims.
What’s happening with Bitcoin
First of these is that Bitcoin is failing as a currency. Now wait, I know a lot of you will say, how is that possible? But it’s true, the transactions on the blockchain are more expensive than ever and that’s only getting worse with the pace of bitcoin.
Issues with Bitcoin as a Currency
It’s no not feasible to make smaller transactions with bitcoin and merchants are less and less inclined to accept it as a method of payment due to the crazy fluctuations of the currency. One of the biggest of these is the games company valve dropping bitcoin as a payment method due to the volatility of the currency.
So if Bitcoin is not a currency then what is it?
It is a store of value, like gold. Bitcoin is a store of value that changes relative to other currencies. This is exactly the same as cash, it just holds value. What that value truly is, is what the market is currently working out. Bitcoin is the first and biggest of a number of ways to hold and exchange value between parties on the internet in a safe and fast way.
Second of these is not knowing if this is a bubble or not. There is a lot of talk about bitcoin being a bubble and this may be true but it could also be just as true that it is not.
Bitcoin is not like tulips, Bitcoin doesn’t rot and it’s not physical. Bitcoin is on the internet and they are not something that will disappear any time soon.
Even if there was a terrible market crash they would still be there and the cryptocurrency market will continue on. As long as there is an internet there will forever be cryptocurrency. I know this doesn’t answer the question and I don’t believe that anyone has an answer.
If it’s not a bubble how far will bitcoin climb?
The short answer, again no one knows. But if there is no catalyst to cause major public mistrust with cryptocurrency then the sky’s the limit. There has never been a truly global currency like bitcoin. There is no way to predict it because it has never happened before.
Does the recent turn in the growth mark a fall?
Well there are a number of technical indicators that tell you that another growth phase is soon to come. But this currency is very hard to predict, maybe the recent turn is actually the market indicating that the value is too high and there is going to be a major decline in the price.
So should you invest in Bitcoin now?
This is the big question on everyone’s mind and it’s a very personal question. And really there are a few questions that you should ask yourself to find out. Firstly, can you afford it? If the money was gone and the bubble burst, you walk away with nothing would it hurt you financially? If the answer to that question is yes then you shouldn’t invest or you should invest less.
Forget the Ferrari, CAN YOU AFFORD TO LOSE IT?
The other question is, what do you think will happen with bitcoin in the future? Is bitcoin taking its place in the global financial market and building itself to that point. Or is this just a fad and Cryptocurrencies will fall from favor as quickly as they have attained it?
Well if your answer is the second option then I suggest you get yourself a front-row seat to a small financial crisis. But if not then I would say why not ride Bitcoin to its place in the global financial world and take a bit of profit on the way.
Invest with your head, there is a lot of information out there. Don’t trust all that you see and hear. There are very simple and obvious truths you just need to look for them. And don’t let someone else make decisions about investments for you. If you don’t have the time to do the necessary reading and keep up to speed with what’s going on then maybe you shouldn’t be in it.