Do you own Bitcoin too?
3:15 pm: 1 BTC = 15,135 USD
The pioneers will remember January 1st, 2013 – where 1 Bitcoin was merely $13.36. Flash forward to May 2017, 1 Bitcoin was equal to $2,098. This cryptocurrency is scarier than your favourite Disney rollercoaster – reaching its peak of over $16,000 this week.
I need you to just stop what you’re doing and think of that for a hot second. How can a currency that you can’t even physically touch, go from 13 USD to over 16 thousand? Over the past few years, the price of a BTC has raised exponentially (and that might not even be the best word to describe it).
If you’re reading this, I assume you already know a thing or two about the future of currency – but if you don’t, feel free to re-read an article I wrote back in May (that even tells you how to invest). Also, if you aren’t aware already, there can only ever be 21 million bitcoins in existence. Not a satoshi* more.
*1 satoshi = 0.00000001 BTC
So here is where everything gets interesting. Everyone is coming up with a theory of how the price of Bitcoin fluctuates. More often than not, the general reason is always “demand”. This does make sense, doesn’t it?
As this cryptocurrency gets more and more popular, everyone seems to want to get their hands on some – well, not actually physically “get their hands on”, but you get the point. You invest in Bitcoin because sources/research/history tells you that the price will go up and you’ll end up making profit. Simple math, right?
3:35 pm: 1 BTC = 15,633 USD
We’ve seen a few brinks in history where Bitcoin has fallen and people have lost it. So putting aside all news outlets talking about the Bitcoin Bubble, haven’t you wondered when (and not if) Bitcoin is going to crash again?
Is Bitcoin a bubble (that’s going to burst)?
Economists have compared Bitcoin’s rise to past mania’s. As detailed in UPROXX – something is a bubble when the price of something that someone is willing to pay for, exceeds its natural value. If the “hype exceeds reality: a bubble forms.” In the case of Bitcoin, you can’t really put a value on it, can you? It’s made up. It doesn’t really exist. Sure, you can put a price on it; but just like the dollar bill, they don’t really have a natural value, it’s what.. we decide it to be.
And we already discussed how Bitcoin get its price, haven’t we? Pure demand. People pay for it, with what they think it is worth. If I told you that tomorrow Bitcoin would go from 15 thousand US Dollars to $10, would you invest? No. Now if it were the opposite, you would currently be asking me how to invest!
So as UPROXX beautifully put it, Bitcoin has been a bubble from the start. If something can go from $13 to $16,000 solely based on demand, then we’re just pumping this bubble and seeing how far it gets us. We have put a price on Bitcoin. Our greed. Our desire. Our curiousity. Our demand.
4:08 pm: 1 BTC = 15,699.31 USD
To answer your question – who knows?
As of October 30, 2017, there were approximately 16,654,762 BTC in existence, out of a possible 21 million. Regardless of whatever you read or research, it’s almost impossible to know when we’ll reach the final number and what will happen then. If I use my high school knowledge, I can conclude that contrary to the US Dollar where there’s paper constantly being printed, the demand for money will never exceed supply, right?
It may exceed the physical “paper”, but a lot of the money we know and love is actually online. Digital.
So if we transfer this theory to Bitcoin, even with other cryptocurrencies trying to make a name for themselves (Ethereum, Litecoin), once we reach 21 million, won’t demand still be at an all time high? If current Bitcoin “rules” tell us that there are a limited number of bitcoins in existence, then won’t basic human nature tell us to always want it? An infinite state of demand and supply?
Because since there can’t ever be more supply of Bitcoin than there is our demand, we will constantly want to buy and sell it.
I don’t know – I’m just rambling, thinking out loud. But in my personal opinion, I feel that till the day comes that people stop caring about cryptocurrency (which might be when you’re actually dead, and then some), the value of Bitcoin might either stay or get to uncertain and imaginary heights.
4:29pm: 1 BTC = 15,800 USD
To answer a few of your questions if you haven’t yet read my previous Bitcoin article.
1) Should I invest in Bitcoin now?
- Isn’t this what everybody wants to know? Back in September I invested $100 which after fees became $74. Today, that $74 is officially $253. Back then, 1 BTC was barely $5,000 (ha, look at me saying “barely”). Today if I invested $100, I would probably only own $60 in BTC (which is peanuts, obviously).
- So this entirely depends on you. But please please please remember one thing, invest responsibly. This isn’t a sure shot get-rich-quick scheme. People have become billionaires, but people have also lost up to their last penny. This is a long term investment. Only invest what you can afford to lose.
2) Should I invest in other cryptocurrency?
- I have investments in Ethereum too – and although I have earned a little bit, it isn’t booming even a third as fast as Bitcoin has. This could be a good thing since you could invest (LONG TERM. EVERYTHING SHOULD BE LONG TERM), and see how high or low you could possibly go.
3) Can I buy stuff with Bitcoin?
- Read my previous article, cupcake. But quick – yes. There are a variety of online and actual stores that will let you pay in Bitcoin, but is it really worth it to spend all that possible cha-ching?
4) How do I even make money with this?
- The point of this as far as money making goes, as the picture above accurately describes.. Buy low, sell high.
5) How do I invest?
- I cover the essential steps in my previous article, but I could always make a step by step video if you guys are interested.
I’ll cut it off here. This has been long enough as it is. If you haven’t already, check out my previous YouTube video. And if you have any questions or want to know about whatever – feel free to shoot me a message.