Should I buy Bitcoin now or am I too late?
No you should not buy bitcoin.
Now I know that everyone is saying “Bitcoin is still one of the best investments out there and it will reach $xx,xxx in two years”, but to be perfectly honest, Bitcoin doesn’t have much room for growth.
Bitcoin is up almost 2,000% in the past year. This is an unheard of growth rate that even the most volatile of traditional investments don’t reach. Maybe in 5 years, but one year? This is something that doesn’t happen everyday.
So say Bitcoin goes up another 2,000% next year. Then each bitcoin will be worth around $320,000(assuming a current price of around $16,000 per bitcoin).
With each Bitcoin being worth $320,000 Bitcoin would have a total Market Capitalization of over $5,120,000,000,000. Yes that is 5.1 trillion US dollars. You would essentially need a large portion of the money in the world, across all countries, invested in bitcoin in order to achieve these kinds of numbers.
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Bitcoin essentially is nearing it’s pinnacle. It might grow 100% or 200% more, which are still ridiculous growth statistics for any investment, however if you are hoping to put 1,000 bucks in Bitcoin and walk away with $200,000 you are out of luck, you missed your opportunity. The days of bitcoins unprecedented growth are over.
Now that is my argument from a growth perspective. Now here it from a practical perspective:
With the rise of bitcoin, there are now literally thousands of cryptocurrencies out there that are worth looking into. Many of them start by being listed on the website below, after which they have their ICO(initial coin offering), and eventually find their way to an exchange.
Cryptocurrency Market Capitalizations | CoinMarketCap
Bitcoin is just the beginning of what cryptocurrencies are capable of, it isn’t the best cryptocurrency, it’s not the fastest, nor the most innovative. Bitcoin was the first cryptocurrency to gain prominence, it’s the first one people started hearing about, and so that’s why it’s price is so out of control.
I’d like to think of Bitcoin as the Blackberry.
Everyone remembers the blackberry right? It was the coolest piece of tech 15 years ago, everyone was talking about it, and the stock price was shooting through the roof.
Then the iphone came out….
By most metrics the Iphone was just a superior product. It was easier to use, did similar functions, and had one button which was amazing when compared to the blackberry. So when buyers started comparing the two it became very clear which was was their preferred choice.
Blackberry’s stock price gradually fell, their market share plummeted, and suddenly the smart phone market exploded with producers like Samsung, Apple, and LG coming onto the scene. Pretty soon the Blackberry was more of an antique than anything.
The Blackberry introduced the world to smart phones, but that doesn’t mean it was the best smartphone, once consumers started getting more options, Blackberry started to falter.
Bitcoin is the same way, it isn’t the fastest processing cryptocurrency, it isn’t the most innovative, it isn’t the easiest to do business in, in essence, Bitcoin’s appeal is it’s widespread adoption, use, and investment. Once investors, and individuals start looking into other cryptocurrencies, however, Bitcoin will probably do a blackberry and lose marketshare.
I’d look into other cryptocurrencies if I were you, there are some incredibly innovative ones that are extremely undervalued. Take Litecoin for instance, I made several thousand dollars today off of a swing in the price of Litecoin. Had I put that same money in Bitcoin over the same time frame I would have actually lost several thousand dollars. I don’t believe Litecoin is superior to Bitcoin(although it does have benefits over it), but Litecoin has a lot of room to grow, as do many other cryptocurrencies out there.
Who knows, there might be another cryptocurrency trading at .50 cents right now that could be worth $5,000 in the future. Don’t look at the past, look at the future. Don’t be kicking yourself over not investing in bitcoin 5 years ago, you should be kicking yourself over not taking steps to find the next bitcoin.