Cryptocurrency And Early Retirement: What No One Is Talking About;

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Coinmonks

6 min readMay 18, 2022

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They said if you dedicate yourself to public service we will guarantee you a decent solid pension but it was all a joke. Pensioners have suffered brutal slaps by the central government through years of poor conditions of work. This has led to extreme hardship for middle and low-class pensioners. Others have taken advantage of investing in cryptocurrency and other investment assets which have yielded tremendous returns.

As a young investor, bitcoin is a retirement plan for the future as inflation keeps galloping, the reason being that after years of labor my mom’s retirement settlement couldn’t set up a business. If publicly traded companies (Tesla, Square, MicroStrategy) have bought billions of dollars worth of Bitcoin as a means to better manage their assets then why will I trust the central government with my retirement savings.

Whether or not you accept the long-term economic opportunities of cryptocurrency, the choice of what you invest your retirement savings in should be yours to decide not the central government. I took the time to explain some of the reasons why I think pensioners, employees, college students, and every young enabling individual should consider bitcoin and other cryptocurrency assets as a long-term investment plan.

What Is Bitcoin? — Easily Explained

Satoshi Nakamoto is the mysterious name associated with Bitcoin creation but nobody knows for sure who created Bitcoin. This technology often described as a cryptocurrency, a virtual currency, or a digital currency — is a type of money that is completely virtual. It’s like an online version of cash. You can use it to buy products and services, but not many shops accept Bitcoin yet and some countries have banned it altogether. El Salvador and the central African republic has officially adopted bitcoin as legal tender and we expect in the coming years, countries with high inflation rate may opt for bitcoin as a legal tender.

Impact Of Inflation On Pension Funds

Inflation is the rate at which the cost of everyday things like food, transport, and electricity increases over time. In the real world, the inflation rate changes frequently. And while the value of goods generally rises due to inflation, they can also fall when there’s deflation. The measurement of inflation is conducted by the federal reserve, where employees are sent to stores with electronic tablets to collect data on whether there has been an increase or decrease in the prices of goods and services. Personally, this method of data collection is inaccurate because there is a potential for human error and poor examination of data.

To elaborate on inflation in real economic terms, let’s pretend you hid $1,000 in cash under the mattress and left it there for five years. And let’s say the rate of inflation was 2% per year over that time. After five years, the cost of living would be about 10% higher than today. So your $1,000 wouldn’t be able to buy as much as it would have done five years ago. In other words, its value had been eroded.

To better understand inflation in terms of saving toward a pension, let’s consider this example: let’s imagine that: your pension is currently worth $100,000. You plan on retiring in 10 years’ time inflation averages 2% per year for the next 10 years. If your pension grew an average of 2% per year then it’d be worth £122,000 monetarily, but you’d be no better off in real terms because the price of everything would have increased by 2% (that’s inflation at work). Your $122,000 would be able to buy the same as your £100,000 could have done 10 years ago.

In recent years, Bitcoin has become increasingly popular as an inflation hedge much like gold leading to Bitcoin’s “digital gold” nickname. While past performance is not a guarantee of future results, Bitcoin has been the “best investment of the decade” producing 200% returns every year for the past 10 years on an annualized basis

How Bitcoin Could Save The 401[k] Pension Plan

Fidelity, the nation’s largest provider of 401(k) retirement plans, opened the door for individuals’ a portion of 20% of their portfolio contributions to be held in Bitcoin. But later came out to put a hold on their amazing decision. Papa Buffett Asked at the annual Berkshire Hathaway shareholders meeting if he had changed his famously negative views on bitcoin or crypto, the 91-year-old investor said “If you … owned all of the bitcoin in the world and you offered it to me for $25, I wouldn’t take it,” Buffett said. “Because what would I do with it? I’ll have to sell it back to you one way or another.

Actually, either bank, individuals, or the central government can tell you how you should invest your hard earn money but I don’t really think you should listen to a 91-year-old who doesn’t know anything about 21st-century technology advice on investing in bitcoin. Truthfully all they care about is their tons of fiat money with the reserve. Below are some compiling reasons why you should choose bitcoin as an investment tool;

Bitcoins Cannot Be Stolen unless someone gives physical access to a user’s computer, and send the bitcoins to their account. Even in situations like these, the other party must have access to your private keys. Unlike conventional currency systems, where only a few authentication details are required to gain access to finances, this system requires physical access, which makes it much harder to steal and misuse by the central government.

Also, Freedom From Central Authority; Bitcoin is a decentralized virtual currency, meaning it’s not regulated by a single government, entity, or central bank. This means that authorities will likely not freeze and demand your coins. There’s also no viable way that taxation would be enforced for Bitcoin. Logically, this gives users independence and control over their money, because the price isn’t linked to state policies. And generally, cryptocurrency users view this as one of the leading benefits of Bitcoin.

Bitcoin is disintermediated; which means business dealings don’t need third parties to complete transactions, Since there are multiple duplicative copies of the transactions database, no one can seize bitcoins and gamble them in stocks or any sort of unscrupulous business deals. The worst someone can do is force the user, by other means, to send the bitcoins to someone else which is not possible. This means that governments can’t freeze someone’s wealth, and thus users of Bitcoins will have complete freedom to do anything they want with their money.

Furthermore, Everything about the central government lacks transparency and openness. Bitcoin users are identified by numerical codes and can have multiple public keys. This ensures there’s no public tracking, and transactions can’t be traced back to the user. Despite the transactions being permanently viewable, which gives you transparency, they’re still kept safe from fraud due to blockchain technology. Compared to a traditional currency method in which personal information could be used for fraudulent transactions, Bitcoin does not require any personal information to conduct transactions, which increases user privacy.

Lastly, Accessibility and Liquidity have been One of the biggest advantages of cryptocurrency, and Bitcoin is no exception. Since it only takes a few minutes to transfer bitcoins to another user, it can be used to purchase goods and services from the ever-growing list of places accepting it. This makes spending money in another country and cross-country exchange of currencies easier.

Bottom Line

As an investor, I believe it’s exceptionally important to educate yourself about bitcoin, and blockchain technologies to better understand on your own the choice of investment you wish to add to your retirement portfolio. And understand all the potential risks involved in that investment you are considering. You shouldn’t follow the crowd and invest in assets you don’t understand. As the saying goes ‘anything that we say is not investment advice but a guide for you to make a better decision investing.

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