Bitcoin (BTC), why we invest in it.
Bitcoin marked the start of blockchain and the cryptocurrency industry, it is slower and older than 2nd and 3rd generation blockchains (you could even argue that it’s tech is outdated, which I think is probably the case) but the fact remains Bitcoin was on the scene first, it gained traction first and has maintained being the largest traded crypto by market cap, Bitcoin is the on-ramp into crypto.
Over the last decade Bitcoin has gone through several cycles of bull market/bare market, and despite being considered a scam by many of us it has endured and continued to grow and is now in the early innings of its next bull market.
For fans of crypto like myself, we have weathered 2 grueling years of a bare market (termed the crypto winter) a main reason we’ve stayed in it is because we believe that in time it will enter a new bull market and if this new bull market is anything like the last two we’ve seen and researched we stand to make a lot of money, Potentially more than before.
We believe blockchain and crypto is an emerging industry and as such Bitcoin is leading the way, it is true that one day maybe bitcoin will be obsolete, and replaced by a newer high-tech blockchain, but that probably won’t happen for some time, and so we continue to hold BTC and recommend our subscribers do the same, if you don’t have any BTC yet then buy some, (see our buy up to price at the end of this write up)
Let’s take a quick look at the current emerging bull market just getting started, why it’s starting, and what will drive this crypto bull market to new highs. But first we need to understand that bear markets are actually good.
The good thing about Bear-markets:
Bear markets are rough on investors as well as the companies within the industry experiencing a bear-market, but bear-markets are a necessary part of a cycle.
1-Bare-markets get rid of zombies and fake companies as these crappy companies often go broke and quit.
2-Bare-markets allow the industry to re-configure itself and build on its strengths, in a bare market companies have to consolidate, and cut costs to survive, this essentially means some companies that survive bear-markets are in better shape fundamentally than they were in the last bull market and often have good potential going forward. (Kind of like going on a diet and becoming fit again,)
Blockchain and crypto are no exception,
During the long crypto winter many of the scams became apparent, simply because they went broke, or because they didn’t deliver on their promises.
Many of the better blockchains and technologies also suffered, but they continued to deliver on their promises, and build out their blockchains, utility, application and technology.
What this means to us is essentially that throughout the crypto winter, the industry as a whole has grown by leaps and bounds in terms of technology and applications and is in much better health than two years ago, so now that we are entering a bull market, these companies are much further along in development than they were a few years ago and therefore some of them are currently considerably undervalued as a result of the crypto winter.
This is great for us as investors, there’s nothing we like more than great companies at below market value! And in time once regular stock market investors hear folks talking about the money their making in crypto, they won’t be able to help themselves but to join the party, probably a little late in the game but I’ll be happy to sell them my seat and cash out.
Another driver in the coming crypto bull market will be Institutional investors:
Institutional investors will be key in driving the next crypto bull market. This is starting to happen slowly already with a few early funds already dipping their toes in a little.
Many institutional investment firms will start buying Bitcoin at first and other alternative tokens later. There are many reasons for why institutional funds are coming around to bitcoin and crypto as an investment, including hedging the dollar and other fiat currency’s, and wanting to get in on the gains they missed in the last bull market,
The biggest reason is that many institutional investment firms are slowly coming round to the idea that maybe blockchain and crypto isn’t all a scam after all and they want to be ahead of the curve to make maximum gains in an emerging industry. It is also easier to purchase and store crypto now than in the last bull market this helps them.
This is big news for us as crypto investors, when institutional investors get into an emerging industry, they might start small, but pretty soon they will plow massive amounts of capital into bitcoin and other coins, the early adaptors will see huge gains and keep pushing more capital in, and the late adaptors will back up the truck to make up for lost time, (fear of missing out) ……and we want to be sitting back enjoying the ride watching our portfolios grow exponentially.
We don’t know how long the bull market will last, no one has a crystal ball, but we will be watching carefully and letting you know when we decide to take some profits as it goes up.
Action to take if you haven’t already:
Buy bitcoin BTC,
While BTC is currently trading around the $10,000 mark, (September 7th 2020) our buy up to price is $25,000, but remember if it’s gone up a lot in the last few days or weeks, it often dips again, so look for a dip to buy if you can.
Remember to always try and keep your allocations about the same size for each investment pick, it’s safer that way!
If you don’t know where to buy bitcoin, you’ll want to make sure that you purchase it directly from an exchange like Coinbase, Binance or Bittrex, and store it in a wallet, preferably not on the exchange itself but elsewhere, always make sure your in control of your crypto and never share your wallets private keys.
Sept 7th 2020 happy hunting!
Until next time,
Frank
