How to Invest in Bitcoin

February 18, 2018 Peter cryptocurrency

How to Invest in Bitcoin

How to invest in Bitcoin and survive, is probably what this article should really be called, because prices had been going crazy for a while now. As I write this, Bitcoin is down almost 70% from the high of December, 18^th, 2017, of around $20,000, trading at around $7,000.

Does this mean that Bitcoin is a dead horse? – No, I don’t think so.

Why Invest in Bitcoin?

So, why invest in Bitcoin if it is such a volatile investment. Well, I’m going to answer that, and more in this post. Firstly, it’s important to remember that since Bitcoin’s creation, it has experienced many deaths as reported via the media, the banks and many so called ‘experts’ in fact, over two hundred times. Yet, it keeps coming back to life. The price changes hourly and could easily rise and fall dramatically, even daily, and significantly as we have seen recently.

To see todays price, in real time see the image below:

Current Bitcoin Price

This gives you the current price for one Bitcoin (1BTC) and it changes regularly.

How To Invest In Bitcoin…continued

But, just because the price is down, doesn’t mean it’s the end of Bitcoin, as an investment.

Just to highlight a few of those many reported ‘deaths’ of Bitcoin.

It crashed 40% on September 2017, dropping from $5000 to $2972.
It crashed 80% on April 2013, dropping from $266 to $54.
It crashed 36% on June 2012, dropping from $7 to $4.
It crashed 94% between June & November, 2011, dropping from $32 to $2.

And each time Bitcoin has supposely died. Its price at the end of the each crash period, has always been higher, than before the reported ‘bubble’ began. So, the overall trend, has been, and still is, upward.

What is a Bitcoin

November 22, 2017 Peter cryptocurrency

What Is A Bitcoin?

Don’t worry if you don’t know too much about Bitcoin. It was little known when it first got started in back 2010. It wasn’t until mid 2013 when it shot up from a few cents to more than US$ 1,000 which was it’s first claim to fame.

Still, by 2015, very few people owned any Bitcoin and the price had receded to around US$ 300 and stayed there for more than a year and the total market at that time was only about $4.4 billion.

It’s only in 2016 that the price of a single Bitcoin had slowly risen to around $700 jumping to $1,200 in early 2017. But from there it has quickly risen, massively, to more than $7,000 in October and November, capturing global attention and stunning investors.

Then it hit $8,000 went past $9,000 and then exceeded $10,000+…

Which is pretty amazing right!

“In fact that’s so astounding that there has never been anything like it before!

Overall the price has risen almost 75,000,000 percent since its inception eight years ago.

You can see todays Price here;

The total market is now around $300 Billion, which is significant, as is the daily trade volume. But what’s really interesting is it’s about to get a whole lot bigger.

Why?

For one, Bitcoin recently broke through US$ 11,000+ per coin and that created a lot of global attention, now everyones talking about Bitcoin.
Two; Limited Supply – There are only Twenty-One million Bitcoins. Ensuring that’s it value will rise as demand and interest continues to grow.
And three; Institutional Investors don’t yet own Bitcoin.

Institutional Investors

Institutional investors are hedge funds, big money managers, sovereign wealth funds with billions of dollars to invest. Usually these big money investors are the first to invest in ground breaking technologies, but with Bitcoin it’s been different.

As institutional investors collectively manage trillions of dollars it shuts them out of any market that is too small ($100 Billion or so) and also they need to be able to hedge their bets. So until now institutional investors haven’t been able to do that with Bitcoin.

But that’s about to change, because the Commodity Futures Trading Commission (CFTC) has recently given the go-ahead for the two big Chicago-based derivatives exchanges to launch Bitcoin futures trading. Opening the door for institutional investors to begin investing and that will send billions, perhaps even trillions of dollars, flowing into Bitcoin.

Limited Supply

There are only 21 million bitcoins that will ever exist and 16.7 Million of those coins have already been mined. Meaning that nearly 80% of Bitcoin’s total supply is already in circulation.

The rest will slowly enter the market over the next 123 years. Ensuring that’s it value will continue to rise as the demand begins to exceed supply.

To put Bitcoins ‘limited supply‘ into perspective, there are some Thirty-five million, US millionaires, but there are only, twenty-one million Bitcoins, so not every millionaire can own a Bitcoin.