When HODLING Bitcoin, There’s Only One Number That Really Matters
Hint: this number is not the price of Bitcoin.
Bitcoin started the year at around $7K. Buoyed by the risk of war between the United States and Iran, then by the coronavirus, and finally by a positive sentiment with the third Halving in its history approaching, Bitcoin saw its price exceed $10K on February 9, 2020.
Quickly, some people got excited. I saw a lot of people saying that Bitcoin would never go below $10K again.
Of course, it did not. Bitcoin follows its own rules, and evolves at its own pace. Forty-eight hours after the $10K drop, Bitcoin was back to around $9,600.
Bitcoin then crossed the $10K again a few days later. The technical analysis specialists immediately saw a golden cross in the evolution of Bitcoin price. Generally, this candlestick pattern is a strong bullish signal in the short term.
That was all it took for many people to say that Bitcoin would never be seen below $10K again.
Again, they were wrong since Bitcoin fell below $10K again on February 19, 2020. Its price even dropped more than 5% in just a few hours.
I guess many were disappointed to see Bitcoin back around $9,600 when it was never supposed to go below $10K again according to some experts.
Personally, the fact that Bitcoin has fallen below $10K several times, and that it is stagnating around that mark, doesn’t surprise me. I explained in a story why this back and forth will continue for some time to come, and especially why this consolidation phase was a good thing for Bitcoin.
Bitcoin Price Is Stagnating Around $10K Without Taking Off, and That’s a Great Thing
Bitcoin price increase needs to be relatively slow to be sustainable.
In what follows, I will tell you why all this information about the short-term price of Bitcoin doesn’t matter. I will also explain that there is only one number that counts if you own Bitcoins today.
Much Ado About Bitcoin Price for Not Much
Bitcoin is just 11 years old. That’s a lot compared to other cryptocurrencies, but very little compared to gold, which has been a recognized store of value for centuries now.
This youthfulness of Bitcoin leads to high volatility in its price.
So there is nothing exceptional about Bitcoin price going from $9,500 to $10,300 in a few hours, in my opinion.
Of course, it’s a pleasant thing, but it’s just noise that distracts you from the main thing about Bitcoin.
Ditto, when Bitcoin drops below $10K in a few hours, as it did at the beginning of the week, you should not panic.
Bitcoin is here to stay, and the fact that its price is at $9,500 or $10,300 today doesn’t make much difference to its long-term future.
Many people place a lot of importance on the CME gaps. Bitcoin will often fill those gaps. That is a fact. However, if you are a true Bitcoiner, these CME gaps should be of no more interest to you than that.
These CME gaps are only of interest to people who consider Bitcoin as a simple investment tool.
Bitcoin is a revolution that is far more than just an investment.
Once you understand what Bitcoin aims to build for the future, you will be able to HODL your Bitcoins without giving too much importance to its short-term price, which is just noise that distracts you from the essential.
Bitcoin Fundamentals Are Excellent
When the price of Bitcoin was $7,500 on October 24, 2019, I wrote that the best time to buy Bitcoin was now. I repeated the same thing when its price suddenly jumped above $9K in early November 2019.
At the beginning of 2020, when the price of Bitcoin was around $7K, I always said the same thing, that this was the perfect time to buy Bitcoin.
As you can understand, I always find it interesting to buy additional Bitcoin whether the price of Bitcoin is $7K, 9K, or even 10K.
For me, the reason behind this choice to continue to accumulate Bitcoin and then to HODL is simple:
Bitcoin fundamentals are excellent, and don’t change whether the price of Bitcoin is $5K or $10K.
The total decentralization of Bitcoin, the fact that Bitcoin has no leader, and even more its scarcity are essential qualities that make, and will make the difference in the future.
So I have an unshakeable faith in the qualities of Bitcoin, and as such I am a Bitcoiner. This allows me not to consider Bitcoin price in the short term as a number that matters.
I don’t see any point in checking Bitcoin price every 5 minutes in a frenzied manner.
I continue to HODL my Bitcoins, and this gives me peace of mind on a daily basis.
You Have to Think Long-Term With Bitcoin
I often say that the best strategy with Bitcoin is the simplest. It consists of 3 steps:
- Buy Bitcoin
- HODL Bitcoin
- Repeat from Step 1
This model requires a true confidence in Bitcoin, and the revolution it builds block by block.
With this strategy, people who bought Bitcoin at the end of 2017 will be winners by the end of 2021 when Bitcoin will have experienced a very strong and prolonged bull market after the third Halving in its history, which is expected to take place around May 12, 2020.
People who don’t trust Bitcoin, and those who only think short term are often the same. Among these people are some who lost a lot of money in 2018 when they surrendered as a result of Bitcoin’s very strong bear market.
This very strong bear market for Bitcoin followed the bursting of the speculative bubble that formed around the price of Bitcoin at the end of 2017.
If you enter the world of Bitcoin, you should do so after you are well aware of its revolutionary side.
Once you understand the fundamentals of Bitcoin, and its phenomenal potential, you will find it much easier to think long term with Bitcoin.
If you don’t understand it, don’t buy Bitcoin, it’s just not for you.
The Only Number That Matters Is the Number of Bitcoins You Own
I hope I have convinced you of the need to think long term if you enter the Bitcoin world. People who think short term are the ones who lose the most money in the Bitcoin world. That is a certainty.
If you choose to think long term, the current price of Bitcoin will no longer be something that matters to you.
The U.S. dollar price of Bitcoin fluctuates on a daily basis, but the current U.S. dollar price of Bitcoin doesn’t really matter.
Bitcoin is aiming for mass adoption by the general public, and in the third phase it is expected to become a unit of account.
If you really believe in Bitcoin, you should be confident in its ability to achieve mass adoption by the general public in the future.
It will take time, but Bitcoin will get there.
Once Bitcoin has become a unit of account, the only number that really matters will be the amount you own in Bitcoin. In fact, no matter what happens, 1 BTC will always remain equal to 1 BTC in the future.
What you own in Bitcoin today will still have the same value in Bitcoin in 2050.
So today you only need to focus on the amount of Bitcoin you own.
Next, I invite you to take a look at the distribution of Bitcoin by address:
You can see that if you own 0.1 BTC at the moment, you will be among the 9.73% richest Bitcoin addresses at the moment.
With 1 BTC, which is the target in my opinion, you will be among the 2.69% richest Bitcoin addresses.
In the future, there will still only be 21 million Bitcoins available. You will therefore own 1 Bitcoin out of 21 million.
According to United Nations estimates, the number of people on Earth is expected to increase from 7.7 billion today to 9.7 billion in 2050 and finally reach 11 billion in 2100.
In 2100, when there are 11 billion people on Earth, there will still only be 21 million Bitcoins available.
That is 1 Bitcoin for every 523 inhabitants on Earth.
The fact that you own 1 Bitcoin today will put you, or your children, among the richest people on Earth. To do this, you must have complete confidence in Bitcoin, because Bitcoin only rewards those who are capable of HODL in the long run no matter what.
Bitcoin price in U.S. dollar fluctuates to a greater or lesser extent on a daily basis. When you own Bitcoins, you need to think long term. So you should not let yourself be disturbed by these fluctuations, which are just noise that can distract you from what is really important.
The bottom line with Bitcoin is the revolution it builds block by block to create a fairer and better system for everyone in the future.
Once you really get to know Bitcoin, you’ll understand Bitcoin’s mission better, and you’ll be able to think long term. You will stop being bothered by the current price of Bitcoin.
You will then understand that when you HODL Bitcoin, there is only one number that really matters: the number of Bitcoins you own.