Does Bitcoin have any value really for the masses or is it just an illusion. Gold is the store of value is that still true and does it compare to other assets
What is Bitcoin and what does it represent
Bitcoin is a product that uses the blockchain for transactions and is both a trading asset and a store of value.
The world has waited for a non-Sovereign store of value that is devoid of political and national disruption that stands alone among the Fiat currencies.
We are becoming well aware of disruptive technologies that change the way we live and do business across the world.
Recent examples of Disruption have been;
|Changed the way we search and see|
|Amazon||The Bookseller that went viral|
|from a target audience to the worldwide appeal|
|Apple||Took a phone to a computer|
|3D Printing||A new way of building things|
|Artificial Intelligence||Doing it by robotic automation|
Now we can add the Blockchain and Bitcoin to the list because things will never be the same again.
Bitcoin is a recognized store of value
Just where you put your money for safekeeping will often be determined by the growth return that it provides to you. For example interest or increase in value in value.
Traditional means can include;
- The S&P index rising at 34.1% this year
- Nasdaq going up 41% this year
- Gold declining by 7.5%
We also have individual shares that show gains and losses, however ;
- Bitcoin increased by 352% in the same time
Investments must have value.
Therefore the best value investment for 2021 has to be Bitcoin.
Compare the values over a decade to draw a conclusion
Certainly, Amazon has gone up around 17x over a decade Google about 11x and the darling Facebook even greater at 32 x its original value. These are massive returns however all are now facing massive challenges to their position.
Amazon has both supply chain problems and a potential union interference in the operation.
Facebook and Google are certainly facing regulatory issues that may affect their future.
The value of Gold has seen a decline by .06 every year averaged over the decade thus positioning it as a dubious long-term investment.
Bitcoin has had a 64x growth in that time at a consistent and annualized rate of 170% every year
This makes Bitcoin as Digital Gold.
The total gold supply is currently valued at just under $10 Trillion and a Bitcoin price of $450,000 would equal the market.
Gold is going nowhere whilst Digital gold is growing as a store of value.
The ten year gold price also shows some volatility with a near 40% collapse in 2015
That would have had investors pulling their hair out
Any new technology needs time to be accepted and I dearly wish I had accepted it much earlier.
Does Bitcoin come with risks?
Yes, Bitcoin comes with risk. However, nothing is without some risk so let’s look at why we think it is safe.
|It could be copied||There have been around 10,000 tries at imitation |
|True proof of work concept||Every movement noted|
|Banning is always possible||China tried and it grew the Bitcoin value|
|Hacking is a potential||An almost impossible venture|
|Global Warming potential||This has been addressed with free energy sources|
|Speculative||It is a trading platform|
Institutional Investors are now coming on board
In the last two years as Bitcoin has become a recognized source of value, the world’s largest investment houses are taking part. These are the so-called Whales that hold large tranches of shares for the long term.
The Greyscale trust, Micro strategies, Galaxy Digital and let’s not forget Tesla.
In the early days, the miners would move the coins gained to cover their expenses however that has now changed. With low-interest rates, they are borrowing money and hoddling the coins for future value. It should be noted that miners are no longer backyard operators but billion-dollar operations performing the tasks to keep up with development
What are the Bitcoin positives
|Consistent value increase||Up around 350% this year|
|Countries adopting Bitcoin as a store of value||el Salvador is the starter|
|Limited supply||Only 21Million coins are available|
|Hedge against inflation||World inflation went mad|
|Used as a currency||Spend with your Sartoshies|
|Available to anyone in small parts||Investments start from around $50|
|Early stage of growth||The future is far ahead of today’s price|
Does Bitcoin have any value really and are there alternatives.
What are your alternatives?
First of all, Cash is dead, and interest rates that are so low you are actually losing value every month.
Picking shares that will provide an income is a gamble and if you get it wrong it can be very bad.
Betting on the S&P, Footsy or Nasdaq could return you up to 30% a year so it is a reasonable value.
The securities regulator has expressed concern this rush of amateurs into the stock market is a train wreck waiting to happen. Its report notes retail investors are, on average, “not proficient” at predicting short-term market movements.The Converstaion
A reasonable result however is subject to fluctuations
Real Estate is going ballistic and is as high as it has ever been but you know the old saying “what goes up must come down”. Furthermore having a value in your home does not feed the hungry mouths.
Choosing other Alt Coins is a choice that can win wars
Bitcoin stands out as the perfect investment for the future. It is difficult times so you really must be careful in placing your money in any one market.
These are turbulent times as inflation runs ahead and governments print money to bolster a flagging community.
This is not investment advice it reflects my understanding of the market. A lot of this is taken from Michael Saylor of Strategic Investments who has a modest $3.16 billion in Bitcoin and still buying.
You will read a lot of rubbish spruiked about the crypto market so get your information from well-versed identities that understand what is happening.
You should carefully choose your advisors.
YouTube has many great supporters of Bitcoin. People like Michael Saylor and Raul Paul.
Stats and figures, not FUD back up their findings.
2 thoughts on “Does Bitcoin have any value really for the masses”
You set out a good case for Bitcoin and its growing value in the world but I’m concerned about blockchain storage. I read somewhere that it takes an enormous amount of energy to run this system and it certainly isn’t green or carbon neutral. How will these problems affect Bitcoin value in the future?
I am interested in the growth of Bitcoin but I would need more information before I invested. Great article.
Thanks Lily and great for the question.
The problem lay with Bitcoin miners which are large masses of computers all working together. This has become a big business and because of cost they mostly operate out of areas where the power is both cheap and green.
That may include Wind, water, geo thermal or any renewable resource.
Elon Musk bought this up however became impressed with the efforts to restrict power and retained all his coins.
Therefor the the issue is now just a talking point for those that want to find issue with the coin.
I just wish I had bought coin when I first looked however am happy to ride it through to about $250k before even considering getting out.
My investment is not all that big but enough to really enjoy the journey.