Short answer: Yes! In my opinion, it’s irresponsible to own zero bitcoin.
Bitcoin has been the best performing asset in the world since its inception in 2009 – let that sink in for a minute.
Many people see the current price of bitcoin and think ‘wow, this is so expensive! It couldn’t possibly double or 10X from here.’ My friend, I’m here to tell you this just isn’t true. Bitcoin’s adoption curve is just getting started, and has tons of room for growth.
The worldwide adoption rate is still very low (in 2021). Only a few percent of the world’s population are currently holding, or using bitcoin. As adoption and usage increases over time, price appreciation will continue.
Bitcoin should be viewed as a long term asset to invest in. While many traders try to make money from buying and selling bitcoin, the easiest (and most effective) strategy is to buy and HODL (hold on for dear life).
Bitcoin is not a scam. Bitcoin is not a get rich quick scheme. Bitcoin has real value, because it solves real problems for real people, and because it has absolute scarcity that cannot be debased.
To learn all the basics, check out my article: What Is Bitcoin? I answer all sorts of questions like: Who created bitcoin? Why was bitcoin created? What makes bitcoin so special?
What About Bitcoin Volatility?
Volatility is a major concern for many potential investors but it’s actually what makes the investment so attractive.
“The volatility is the price you pay for it to be 10x outperforming the S&P Index for a decade and be outperforming Nasdaq and the S&P by a factor of eight in the last 12 months.”
Michael Saylor, CEO MicroStratagy
An asset is considered to be volatile if it goes up, or down. Because bitcoin has gone up drastically in price over time, it is considered to have a high level of upward volatility.
But of course, nothing goes straight up forever. There will always be market corrections from time to time. To learn more about bitcoin volatility check out this article: Why Is Bitcoin So Volatile?
Bitcoin vs Stocks vs Gold vs Real Estate
If you’re trying to answer the question of whether or not to buy bitcoin, you need to compare it to the alternatives. Store of value assets that compete with bitcoin are: cash, stocks, bonds, real estate, and precious metals (among others).
While all of these assets have pro’s and cons, I believe that bitcoin is the best possible asset to invest in for the long term.
Bitcoin is the single most important asset you can own in the 21st century.
Robert Breedlove – The “What is Money” show (YouTube)
Let’s take a look at the 10 year performance of bitcoin versus these other asset classes. We’ll look at a 10 year, non-inflation adjusted return based on the 10 years prior to September 2021 when this article was published.
10 year returns:
Bitcoin: +652,779%
S&P 500: +301%
Nasdaq: +525%
Gold: –0.63%
Silver –42%
US Home Value: +85%
The numbers speak for themselves. Every other asset class has been obliterated by bitcoin’s return in the past 10 years.
Past performance is not always an accurate indicator of future performance, however, history often rhymes.
By this I mean – bitcoin may, or may not outperform the S&P 500 by 10X in the next decade. But in my opinion, it is likely to continue outperforming by some margin, whether it’s massive, or modest.
Using this same 10 year time frame, if you could go back in time and invest just $100 in bitcoin in September of 2011, you would have purchased 12.5 bitcoin at a price of $8 per coin.
Two months later in mid November, the price of bitcoin had fallen to a low of $2.25 and your initial $100 investment has lost 71.8% of its value – yikes!! This volatility is scary, but don’t sell!
Let’s say you DCA (dollar cost average) to bring down your cost basis. So you invest another $100. Timing the bottom is nearly impossible, so let’s just assume you buy near the bottom at $2.50, and obtain another 40 bitcoins.
Now just hold, and don’t even think about selling. Fast forward to 2021, and your initial investment of $200 is now worth over $2.6 Million and growing!
The good news is that you’re not too late to get started now. Even though bitcoin is much more expensive now than it was 10 years ago, we’re still early in the game.
Getting Started
The best way to learn about bitcoin, is to dip your toes in the water. I recommend starting by purchasing a small amount of bitcoin, and getting self-custody storage setup on your personal computer, cell phone, or a hardware wallet.
Going the through the process of purchasing bitcoin from an exchange, and then transferring it to your self-custody storage solution will teach you a great deal about what bitcoin is, and how the system works.
In the near future, I plan on writing a step-by-step guide that will walk you you through this entire process. I will link it here once it’s complete.
Where To Buy Bitcoin?
If you buy something, or create an account with one of my links, I may earn a commission.
There’s tons of places to buy bitcoin. When choosing an exchange to purchase from, it’s important to find low rates, accurate pricing, a good reputation, top-notch security, and most importantly – bitcoin withdrawals.
I’ve used several of different exchanges to test out user experience, and my favorite is: Strike.
Strike has the lowest rates in the industry, and a great reputation. The only downside is their somewhat low limit of $1,000/week (but you can get this limit raised if you inquire).
While most people will not have more than $1,000 per week of investable income, this limit can be a pain if you have a substantial net worth, and are trying to reach a portfolio allocation.
