Is it too late to buy bitcoin?
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One question that we will get a lot this Bull run is “is it too late to buy bitcoin?”
Bitcoin has stayed for under $30k for the past year and a half. We just recently pump from $30k to $60k since December 2023.
I told him also to buy at $25k to $30k range. He said that can still go down.
I told my friend to buy Bitcoin when it hit $60k
he told me that it is now too expensive.
But is it?
Most of us invest when price is going up and don’t buy when the price is going down.
We do what is the exact opposite of investment advice which is to buy low and sell high.
When a shoe or bag is in sale , we buy them immediately. But somehow we can’t apply that to Bitcoin or other investments.
In buying Bitcoin, long-term hold is the best strategy. Predicting what Bitcoin will do over the next few days, weeks or months is a fool’s errand. That will either get you sidelines or rekt.
When buying Bitcoin, you should not base your decision on whether bitcoin will go up or go down next week or next month.
The right questions to ask yourself is “what are your alternatives?”
That question will differ per individual because we have different understanding of different investments.
If you have P100,000 today that you’re willing to invest and don’t need it in 10 years. Are you more comfortable to hold it in stocks, bonds, real estate or bitcoin?
If you hold it on stocks, what stocks? It’s hard to pick individual stocks. Most people will say index funds. Can index funds outperform bitcoin in 10 years?
If you don’t want to take risk and save in Cash, you are guaranteed to lose value because of inflation. Bonds similar with cash will suffer from inflation or debasement over time.
Real estate is an expensive choice and illiquid.
You want to store your long-term savings on an investment that will outperform inflaiton. That’s why most invest in stocks because historically they outperform bonds and the rate of inflation.
But now that there is a faster horce in the race than stocks ( which is bitcoin), why not bet on the winning horse?
Of course, past performance does not guartantee future returns. But you want to invest in asset that is not yet adopted by the masses. You want to be an early adopter. Believe it or no, we are still in the early phase of bitcoin adoption.
We are Still Early
Is it too late to buy bitcoin?
If you have long - term horizon of more than 10 years, we are still very early.
If you are a trader, you were late because the best chance to buy was a year ago when we dip to $16k. But of course you can’t roll back the clock or time travel to the past.
You can’t wait for the dip of $20k because I firmly believe we won’t see bitcoin at that price anymore.
In fact I’m confident that we may not see bitcoin below $40k anymore (Not Financial Advice).
Of course anything can happen, but you’ve got too move forward and based your decisions on what bitcoin price will be on the future.
I believe that bitcoin will be somewhere between $200k - $400k in the next 2 years.
If I believe that , it doesn’t matter whether I am buying now at $50k or $65k.
And I am a long-term hodler. I do not have plans on parting with my bitcoin anytime soon. If I will ever do, it will be just a small part of my bitcoin stack.
One way to visualize that we are still early is the market cap of bitcoin:
Another way is to estimate how many people are using bitcoin, the estimate ranges from 1% to 5%, there’s no reliable way to know the exact bitcoin adoption.
But what you can do is to ask family or friends if they own bitcoin, it is likely that 99% of them don’t own any.
We are still early. Be thankful, because if everyone owns bitcoin now, it’s unlikely to 10x or 100x the price.
Some says that bitcoin is in the 1995 phase in terms of internet adoption.
Bitcoin like a virus will be adopted by everyone. Understand that first before buying bitcoin.
There are many reasons why would that happen. Best way to learn about that is to understand history of money
Bitcoin is best understood through the lens and history of money and how money printing works. Once you understand that, you won’t have to convince yourself to ape into bitcoin.
You can check out my blog series if you want to learn how bitcoin will be adopted through the lens of money:
Chapter 1: “Everything is More Expensive”
Thank you for reading!
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