Today one Bitcoin is worth $47,649. February 2011, 1 BTC sold for $1. In 10 years, so much has changed, and many people became millionaires as early Bitcoin investors.
As grand as the valuation sounds, cryptocurrency experts still posit the ecosystem to cover more grounds. On the other side of the spectrum, non-crypto persons wonder if it is too late to invest in bitcoin.
In this article, we want to talk about Bitcoin investing. Is it too late to invest in Bitcoin? What are some alternatives to investing in Bitcoin? Keep reading to learn more.
CAN YOU STILL INVEST IN BITCOIN?
First, the question arises can you still invest in Bitcoin. Of course, the answer is Yes!
You can still invest in Bitcoin. However, its market price is highly volatile. Unlike major fiat currencies that maintain price stability or value, Bitcoin’s price fluctuates as it’s controlled by market sentiment and trades. According to Anton Altement, Chief Executive of Polybius and OSOM Finance, “Bitcoin is perceived as a reliable store of value, and it is likely to stay that way for the foreseeable future.” He also added saying, “It is never too late to get into Bitcoin, just like it is never too late to get into gold.”
WHAT MAKES BITCOIN SPECIAL?
As an asset, Bitcoin has some features different from fiat currencies. A notable one is its scarcity. For instance, fiat currencies undergo regular printing by the central banks or federal reserve. However, the supply of bitcoin cannot increase. Instead, it has a fixed maximum supply of 21 million tokens that will ever be in circulation.
Hence, the scarcity of Bitcoin will persist, which will drive an increase in its value. Although Bitcoin has done over 50,000x price increase since its creation, there are predictions from experts that Bitcoin would someday hit $100k. At the beginning of 2021, the Bitcoin price was less than $30k. However, in less than a year, the popular crypto asset flipped its price value to an all-time high of $68,000.
With time, the economics around Bitcoin will change, and the primary incentive will be around ownership and sales. Hence, the next best time to invest in Bitcoin ownership is immediately after reading this piece.
IS IT TOO LATE TO INVEST IN BITCOIN?
Summarily, is it too late to invest in bitcoin? No. There is still some time before the world can mine the whole Bitcoin supply. However, the earlier you take action, the better. However, before investing your hard-earned money into BTC, understand the market realities. Investing is inherently risky. Nothing is guaranteed.
THE CURRENT REALITY OF BITCOIN
Knowing that it is not too late to invest in Bitcoin is one thing; understanding the market is another. As of now, speculations about Bitcoin as an asset persists. Hence, there is a constant fluctuation in pricing based on perception at a given time. So, as a new Bitcoin investor, get familiar with the price fluctuations. It will influence your short-term decision-making.
First, the Bitcoin Mining process requires a large supply of electrical power. A study claims that the global bitcoin network uses as much energy as Norway or Argentina. Second, transactional cost – time is on the rise. The network has become massive, taking about 10 minutes for transaction validations and a high transactional fee within Q1 – Q2 2021. Nevertheless, the lightning network, a layer-2 payment protocol designed on the Bitcoin blockchain, ensures faster transactions.
THE PROS AND CONS OF INVESTING IN BITCOIN
The pros of bitcoin are massive, and the potential cons are immensely disquieting. Unlike many other investment destinations, Bitcoin poses a high risk. However, the increased risk can be associated with high rewards. As traders often say, the money is in volatility.
Perhaps you can avoid regret by investing in the cryptocurrency market today. Perhaps you could lose your investment. The cryptocurrency ecosystem is an emerging market gradually gaining adoption. So, while it’s not too late to invest in bitcoin, you need to be prepared for both outcomes.
CRYPTO INVESTMENT OPTIONS FOR BEST ROI
Bitcoin is a significant player in the cryptocurrency space. It was the best performing asset of the last decade with an annualized return of 230%. However, as a new investor, you may consider having other cryptocurrency options for investment. Hence, there are other crypto assets, which have proven to be viable investment options with high returns on investment. These include:
Launched in 2015, Ethereum has risen to become highly valuable in the cryptocurrency space. In recent times, Ethereum took several leaps that increased its market share from 19.6% to 21.6%. Ethereum is fundamentally different from Bitcoin. The Ethereum blockchain is now the most-used blockchain in the world. It powers what experts call the future of finance – Decentralized Finance (Defi). The Ethereum blockchain also hosts the new wildly popular asset concept – NFTs. The growing relevance of Ethereum and its technology promises an increase in its value. Consequently, high ROI for you if you invest now.
In recent times, Solana witnessed an incredible turn of fortune. Founded in 2017, Solana is an open-source project that hosts decentralized, scalable applications. The crypto went from having a market share of 0.01% to 2.6%. Its growth in recent times reflects the growing fields of Decentralized Finance (Defi), smart contracts, trustless ecosystems, and the elimination of financial gatekeepers. Asides from Ethereum and Bitcoin, this is another cryptocurrency asset with credible use cases for investing.
According to CoinMarketCap, Binance is the world’s largest cryptocurrency exchange with an average $14.6 billion volume traded every 24 hours. There are over 500 other cryptocurrencies listed on the Binance exchange. Here, you can diversify your investments. Ensure you do due diligence on each crypto you are interested in, though.
Beyond its fundamental role as an exchange platform, there is also the Binance Coin (BNB). Starting from a 0.7% market share in 2021, BNB currently accounts for about 4.1%. The growth within 12 months indicates growing interest, resulting in increased value. In Jan 2021, the price of 1 BNB was $37.41. Now, 1 BNB is worth $521. So, BNB is another example of a solid project to invest in asides from Bitcoin.
The cryptocurrency space is growing, and Bitcoin’s adoption is rising. It’s not too late to invest in Bitcoin today, but you need to do your own research. There are pros and cons to investing in this market. Make sure you understand how it works and the risks involved.
Theresa is a personal finance blogger. She writes content for busy professional women to take control of their money and investments. She enjoys reading, traveling, cooking, and writing. Her work has been featured on GoBanking Rates, Your Money Geek, Savoteur, the Corporate Quitter, Thirty Eight Investing, and more.