Is Bitcoin a Good Investment?

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Yes. Bitcoin is liquid and scarce so it retains its value better than any other asset on the planet. Over the last 10 years, Bitcoin has a CAGR of 200% that outperformed all other asset classes such as stocks, bonds, REITs, precious metals, artwork, and collectibles.

Many Bitcoin newbies are wondering if Bitcoin is a good investment even though the mainstream media speads FUD about cryptocurrency all the time.

I first bought Bitcoin in 2018 and spent dozens of hours learning about why Bitcoin is valuable and what makes it a good long term investment.

This is my honest opinion on why Bitcoin is a fantastic long term investment if you are willing to think about the box and take a risk by investing in the world’s next global reverse currency.

Scarcity: There are Only 21 Million Bitcoin Total in Existence

When doing research on any investment, many investors focus solely on price but I believe looking at total supply and market cap provides a lot more information that most people miss.

Bitcoin has a total supply of 21 million coins, which 18 million have already been mined.

According to Decrypto.co, there are around 2 to 3 million coins that will be lost forever. That puts further supply shock on Bitcoin and makes it more valuable in the long run.

Compare Bitcoin’s rarity to a publicly traded stock that issues common shares like Apple Inc on the NASDAQ or NYSE.

Total SupplyMarketcap
Bitcoin (BTC)21 million$650 billion
Apple Inc (AAPL)17 Billion$2.4 trillion

Apple Inc is the most valuable company in the world with over 17 billion common shares available and a whopping $2.4 trillion market cap.

Bitcoin’s 21 million coins is far more rare than the 17 billion AAPL outstanding shares.

While Apple stock does pay a dividend, you can earn yield on your Bitcoin holdings by depositing your crypto into a Bitcoin interest savings account, too.

Scarcity equals value and I think Bitcoin is a better investment if you value rarity of an asset.

Bitcoin’s Historical Performance Is Greater Than Any Other Asset Since 2011

Cryptocurrency tends to outperform most asset classes and Bitcoin leads the pack.

In 2011, Bitcoin’s price was under $1 and now 1 whole Bitcoin costs around $40,000.

Even Grayscale Bitcoin Coin Trust (GBTC), which went public in 2013, has a total return of 26,000% since inception. If you want invest to Bitcoin through the stock market then check out my list of best Bitcoin stocks.

Bitcoin will provide investors with some of the greatest upside potential although there are lots of risk factors to consider.

It’s possible that Bitcoin adoption could slow down or perhaps another cryptocurrency takes Bitcoin’s position as the dominant crypto asset.

I don’t think that’s likely because Bitcoin maintains a 40%+ dominance over the cryptocurrency market with a whopping $600+ billion marketcap.

Bitcoin is the world’s oldest cryptocurrency and I don’t see its dominance changing anytime soon.

Inflation Proof: Protect Your Wealth Against Rising Prices

Society has declined alongside the demist of the US dollar and fiat currencies in general.

Growing up in the 90’s, I cannot believe what I’m witnessing today as I watch society fall off the deep end.

The world is suffering from many plaques as I type this and a lot of these problems come from a broken monetary system that robs hard working people of their savings.

Every day, the US dollar and other government issue currencies lose value and thus our work energy gets diluted over time.

Us Dollar Decline

Of course, many investors put all their money into the stock market but it doesn’t solve the underlying problem that plaques society.

Only 55% of Americans invest in the stock market so the other 45% of Americans must suffer and watch their savings dwindle over time.

Historically, Gold was the #1 hedge against the US dollar but gold is not extremely rare on this planet. Every day, gold miners dig up the earth and sell more gold in the global economy. It’s one of the reasons why gold performance over the last 10 years remains flat. There is too much gold supply and not enough demand.

Bitcoin fixes this problem with a finite fixed supply. Anyone can mine Bitcoin and hold it as an investment.

Conclusion

We live in a digital world that must use a superior digital currency as a replacement to traditional fiat currencies.

If you want to protect your wealth for future generations then holding Bitcoin in your investment portfolio is a superior hedge to inflation than anything else.

I plan to never sell Bitcoin in exchange for fiat currencies and will patiently wait until the world adopts a Bitcoin standard.

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