Bitcoin is fascinating. It is the first real contender to enter the ring as a viable store of value for wealth outside of precious metals. With that said, the idea of calling the purchase of any form of money or currency “investing” is ludicrous. When you take your currency and swap it for another currency you’re not investing, you’re denoting your wealth from one denomination to another. But 90% of people who are reading this don’t understand what I truly mean when I say that.
Sure you can accumulate more wealth by swapping currencies. Their values fluctuate in relation to one another. You can hop, skip and jump your way to a larger pile of currency… we call it the FOREX. So, buy or mine bitcoins in 2010 and now you can convert those to millions of dollars, but that’s just the value of the bitcoin in the relation to the USD.
The most interesting aspect of getting to partake in this 7 year surge is that Bitcoin is new and needed to find its price. It entered the money markets extraordinarily undervalued against it’s potential. These events are rare. It’s super cool to be a part. I think it’s getting close to finding a stable price now. It’s a great place to put your money. But not because Bitcoin will garner us more future USD. It’s because I believe that bitcoins will reliably store wealth and retain that value despite future calamity.
The only reason it’s gone up as it has is because it has been proving itself as a viable store of wealth, which I don’t know that it has fully done that yet, but it’s position in the currency market has done nothing but gotten stronger. Now that Bitcoin has caught up with the price of gold, I think it cools off big time big time. In fact, I think it’s a bit high on spec right now. But, what do I know?! It could stay up there. Everything is as valuable as the market decides it is.
One thing we can say for sure.. it paid to be early and correct about bitcoin.