Predictions On The Future of Bitcoin, & The Future of USD
Bitcoin has hovered and since Musk bought in and institutional investors bought in, it's still in profit. Bitcoin did not perform like expected when institutional investors like Musk legitimized Bitcoin, but we may be in for an interesting time ahead.
Hindsight will always be 20/20.
If Bitcoin crashes, those who didn't buy in will say "see, I was right!"
If Bitcoin skyrockets to 100k, those who bought in will say, "see, I was right!"
The truth is that no one really knows. At this stage in history, Bitcoin has a chance to multiply like nearly no other asset in history. At the same time, the same volatility that allows it to potentially skyrocket to unprecedented levels, also allows it to crash.
Just remember, never invest what you are not willing to lose. If you aren't willing to live forever without the money you are investing, then do not invest it!
OTHER FACTORS AT PLAY
There are other factors at play here with Bitcoin this time around though. Many people who don't understand economics don't realize that BTC-USD is not all about Bitcoin. It's also about USD. If USD goes down, then BTC goes up. If USD goes up, BTC goes down.
This is part of what is presently happening. Even though USD has now been massively devalued, it is being artificially propped up with Keynesian fiscal policy. This is part of why you see the odd volatility with BTC and why it's not performing as you might expect considering the circumstances. It is the manipulation of the economy by the Fed and by the government.
What many people may not realize is the looming and inevitable threat of USD collapse. If and when USD crashes and possibly collapses due to the extreme money printing (most USD "printing" was done via digital, not paper money), of which since January 2020, USD has been devalued by about half, then it is now only a matter of time before USD value catches up with its devaluation.
KEYNESIAN MANIPULATION OF USD
Presently monetary measures using Keynesian policies are manipulating the looming collapse trying to keep USD afloat. People do not realize the unrivaled threat. If and when USD eventually collapses, since Keynesian fiscal policy is unsustainable, then anyone who holds USD will lose the equivalent proportion of spending power that they hold.
If USD collapses and loses half its value then the $100 USD that someone holds will be worth $50.
This will have some good effects but mostly catastrophic effects.
THE GOOD: Anyone who holds a mortgage, student loan, or loan, will have what they owe effectively reduced by half. This is because if you owe $100, but spending power has reduced by half, so effectively you now owe the equivalent of $50. You still owe "$100" in numbers, but paying it back will be easier because the money will be more plentiful.
Borrowers win when USD loses value due to inflation, and they win big on hyperinflation. Why do you think the banks implement Keynesian policies to intervene in the economy? They don't want to lose money on what they have lent.
THE BAD: Unemployment skyrockets as employers are no longer able to sustain salaries, companies collapse as they can no longer afford goods, homelessness skyrockets as people can no longer afford living expenses (especially renters who are lose big when it comes to hyperinflation once price correction on rent sets in), cost of goods and food skyrocket, and ultimately the economy collapses.
The real risks in the most serious cases are the total collapse of society. This is what happened to Rome and every other country which used and abused Fiat currency by diluting their currency until it became worthless. Every fiat currency will fail sooner or later, because of the very thing that is happening in the US today.
OTHER FACTORS AFFECTING BTC
Another major factor is the fixed supply of Bitcoin, along with the halving that continues to make it a more rare asset. moreover, the massive mining farms in China and Israel are also making Bitcoin more scarce by gobbling up more Bitcoin at a faster rate. Once there is no more Bitcoin, there is not more supply, and it become a rare resource that can only be traded from existing owners, with a permanent backing.
Even with a backing, Bitcoin is not immortal. It also takes adoption. If Bitcoin ever becomes a common currency like fiat currencies, then it will skyrocket. If it ever takes the global stage, then many Bitcoin owners will be rich who held for the long term.
Conversely, if global government policies ever restrict or ban the use of Bitcoin, it has a real chance of sinking into oblivion. Fortunately, institutional investors are currently well-invested into making sure that does not happen. It could though. There are a lot of individual things that could happen to collapse the house of cards, but it will take a lot of things to happen altogether in order for it to skyrocket.
All in all, Bitcoin is worth the risk in my opinion for a reasonable investment. It is not worth the risk to overleverage myself by investing more than is a reasonable percentage of my liquid assets - which I would place at 10% to 20% being a reasonable amount. I'm holding about 10%. It's enough that I won't break the bank if Bitcoin ends up crashing, and can hold forever.
NEVER INVEST MORE THAN YOU CAN AFFORD TO LOSE
Remember to err on the side of caution. Investing is a risk, and even though there are known factors, there are also many unknown factors. Therefore, it is practically a pure gamble.
All the people with all the graphs can only mitigate risk, they can never assert with any degree of certainty whether an asset will go up or down, unless they have inside knowledge, which is a crime (insider trading). Just like in a casino, the only way to guarantee a win is to break the rules, and like in a casino (counting cards or using loaded dice, for example), the end result would end up with you in jail or dead.
In other words, they have ensured that you cannot legally have any advantage to give you the ability to know any further than basically a pure gamble what will happen. Warren Buffet spends all his time reading and invests in companies which have a proven success record, and holds for the long term. You cannot use his strategy to get wealthy, because he has billions to play with and has decades of seeing how companies come and go - I think he sees economic trends.
But even Warren Buffet is a victim of the fact that he cannot legally have a real advantage, and that's why he refuses to invest in crypto - it is simply a gamble. That doesn't mean you shouldn't, because Buffet also didn't invest in many tech startups when he had the chance which have made others rich. Still, most startups fail, so most investors lose their money.
The point of all this is simply that no one can really know. You have to treat it like a pure gamble. There is no secret formula, no secret knowledge that i legal to know. You can only know after the fact. I learned that Musk bought Bitcoin and I bought into it. It might go up. It might go down. But he legitimized it, making it a real possibility to be a solid future asset. Still, I might lose all the investment, and that is the gamble. But it's not a gamble to risk with any real quantity of money that would put you in a hard place if you lost it.
HINDSIGHT IS 20/20. THE TRUTH IS NO ONE KNOWS THE FUTURE
2 weeks ago I could have re-invested my full 20K. It was in the bank, sure. Bitcoin was going up. Instead, I pulled 10K at the beginning of the month and stopped checking on it, and left only 2k in Bitcoin. Why? Because it's not worth the gamble to use money that matters for my survival and my future. Then last week BTC-USD actually hit over 60k. That could have been an extra 3k in my account.
Was it worth it now that Bitcoin is back at 50K? Of course not. I could not have known it would go over 60K with any certainty, nor could I have known if it would go back to 50K this week. There is no way to know these things with any degree of certainty. No amount of statistical models and probability will guarantee any prediction. Instead, the best strategy is forget the ups and downs, and invest what you can reasonably afford to lose (like 10%) - but only if you're willing to lose that forever - and then hold it forever.
I mean forever. Like if Bitcoin goes to 3k again, then you still hold it and forget about it for years, until maybe one day the New World Order global government uses Bitcoin as the new global currency and suddenly BTC goes to a million. Or something like that Or it never does.
You only pull once Bitcoin finally arrives and is high and stable. Then you can pull, because now you can use it to build a life for yourself. Otherwise, you simply hold forever. And you can put some in here and there on a regular basis if you want to grow your portfolio, but never enough that you are emotionally invested in it.
Again, never invest what you are not willing to lose. Hope it helps.
Hindsight will always be 20/20.
If Bitcoin crashes, those who didn't buy in will say "see, I was right!"
If Bitcoin skyrockets to 100k, those who bought in will say, "see, I was right!"
The truth is that no one really knows. At this stage in history, Bitcoin has a chance to multiply like nearly no other asset in history. At the same time, the same volatility that allows it to potentially skyrocket to unprecedented levels, also allows it to crash.
Just remember, never invest what you are not willing to lose. If you aren't willing to live forever without the money you are investing, then do not invest it!
OTHER FACTORS AT PLAY
There are other factors at play here with Bitcoin this time around though. Many people who don't understand economics don't realize that BTC-USD is not all about Bitcoin. It's also about USD. If USD goes down, then BTC goes up. If USD goes up, BTC goes down.
This is part of what is presently happening. Even though USD has now been massively devalued, it is being artificially propped up with Keynesian fiscal policy. This is part of why you see the odd volatility with BTC and why it's not performing as you might expect considering the circumstances. It is the manipulation of the economy by the Fed and by the government.
What many people may not realize is the looming and inevitable threat of USD collapse. If and when USD crashes and possibly collapses due to the extreme money printing (most USD "printing" was done via digital, not paper money), of which since January 2020, USD has been devalued by about half, then it is now only a matter of time before USD value catches up with its devaluation.
KEYNESIAN MANIPULATION OF USD
Presently monetary measures using Keynesian policies are manipulating the looming collapse trying to keep USD afloat. People do not realize the unrivaled threat. If and when USD eventually collapses, since Keynesian fiscal policy is unsustainable, then anyone who holds USD will lose the equivalent proportion of spending power that they hold.
If USD collapses and loses half its value then the $100 USD that someone holds will be worth $50.
This will have some good effects but mostly catastrophic effects.
THE GOOD: Anyone who holds a mortgage, student loan, or loan, will have what they owe effectively reduced by half. This is because if you owe $100, but spending power has reduced by half, so effectively you now owe the equivalent of $50. You still owe "$100" in numbers, but paying it back will be easier because the money will be more plentiful.
Borrowers win when USD loses value due to inflation, and they win big on hyperinflation. Why do you think the banks implement Keynesian policies to intervene in the economy? They don't want to lose money on what they have lent.
THE BAD: Unemployment skyrockets as employers are no longer able to sustain salaries, companies collapse as they can no longer afford goods, homelessness skyrockets as people can no longer afford living expenses (especially renters who are lose big when it comes to hyperinflation once price correction on rent sets in), cost of goods and food skyrocket, and ultimately the economy collapses.
The real risks in the most serious cases are the total collapse of society. This is what happened to Rome and every other country which used and abused Fiat currency by diluting their currency until it became worthless. Every fiat currency will fail sooner or later, because of the very thing that is happening in the US today.
OTHER FACTORS AFFECTING BTC
Another major factor is the fixed supply of Bitcoin, along with the halving that continues to make it a more rare asset. moreover, the massive mining farms in China and Israel are also making Bitcoin more scarce by gobbling up more Bitcoin at a faster rate. Once there is no more Bitcoin, there is not more supply, and it become a rare resource that can only be traded from existing owners, with a permanent backing.
Even with a backing, Bitcoin is not immortal. It also takes adoption. If Bitcoin ever becomes a common currency like fiat currencies, then it will skyrocket. If it ever takes the global stage, then many Bitcoin owners will be rich who held for the long term.
Conversely, if global government policies ever restrict or ban the use of Bitcoin, it has a real chance of sinking into oblivion. Fortunately, institutional investors are currently well-invested into making sure that does not happen. It could though. There are a lot of individual things that could happen to collapse the house of cards, but it will take a lot of things to happen altogether in order for it to skyrocket.
All in all, Bitcoin is worth the risk in my opinion for a reasonable investment. It is not worth the risk to overleverage myself by investing more than is a reasonable percentage of my liquid assets - which I would place at 10% to 20% being a reasonable amount. I'm holding about 10%. It's enough that I won't break the bank if Bitcoin ends up crashing, and can hold forever.
NEVER INVEST MORE THAN YOU CAN AFFORD TO LOSE
Remember to err on the side of caution. Investing is a risk, and even though there are known factors, there are also many unknown factors. Therefore, it is practically a pure gamble.
All the people with all the graphs can only mitigate risk, they can never assert with any degree of certainty whether an asset will go up or down, unless they have inside knowledge, which is a crime (insider trading). Just like in a casino, the only way to guarantee a win is to break the rules, and like in a casino (counting cards or using loaded dice, for example), the end result would end up with you in jail or dead.
In other words, they have ensured that you cannot legally have any advantage to give you the ability to know any further than basically a pure gamble what will happen. Warren Buffet spends all his time reading and invests in companies which have a proven success record, and holds for the long term. You cannot use his strategy to get wealthy, because he has billions to play with and has decades of seeing how companies come and go - I think he sees economic trends.
But even Warren Buffet is a victim of the fact that he cannot legally have a real advantage, and that's why he refuses to invest in crypto - it is simply a gamble. That doesn't mean you shouldn't, because Buffet also didn't invest in many tech startups when he had the chance which have made others rich. Still, most startups fail, so most investors lose their money.
The point of all this is simply that no one can really know. You have to treat it like a pure gamble. There is no secret formula, no secret knowledge that i legal to know. You can only know after the fact. I learned that Musk bought Bitcoin and I bought into it. It might go up. It might go down. But he legitimized it, making it a real possibility to be a solid future asset. Still, I might lose all the investment, and that is the gamble. But it's not a gamble to risk with any real quantity of money that would put you in a hard place if you lost it.
HINDSIGHT IS 20/20. THE TRUTH IS NO ONE KNOWS THE FUTURE
2 weeks ago I could have re-invested my full 20K. It was in the bank, sure. Bitcoin was going up. Instead, I pulled 10K at the beginning of the month and stopped checking on it, and left only 2k in Bitcoin. Why? Because it's not worth the gamble to use money that matters for my survival and my future. Then last week BTC-USD actually hit over 60k. That could have been an extra 3k in my account.
Was it worth it now that Bitcoin is back at 50K? Of course not. I could not have known it would go over 60K with any certainty, nor could I have known if it would go back to 50K this week. There is no way to know these things with any degree of certainty. No amount of statistical models and probability will guarantee any prediction. Instead, the best strategy is forget the ups and downs, and invest what you can reasonably afford to lose (like 10%) - but only if you're willing to lose that forever - and then hold it forever.
I mean forever. Like if Bitcoin goes to 3k again, then you still hold it and forget about it for years, until maybe one day the New World Order global government uses Bitcoin as the new global currency and suddenly BTC goes to a million. Or something like that Or it never does.
You only pull once Bitcoin finally arrives and is high and stable. Then you can pull, because now you can use it to build a life for yourself. Otherwise, you simply hold forever. And you can put some in here and there on a regular basis if you want to grow your portfolio, but never enough that you are emotionally invested in it.
Again, never invest what you are not willing to lose. Hope it helps.
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