When I first heard about cryptocurrency, I had a gut feeling that it would somehow become something big. The problem was, I was uncertain about how to get possession of it in late 2010, early 2011 when Bitcoin moved to around $1.00.

Fast forward six years when I asked a good friend of mine who works in the tech industry what he thought about Bitcoin, and he said, “I looked into it about 3-4 years ago, but never ended buying into it.” In late December of 2016 when this conversation was had, Bitcoin was around $800.

Even more of a stinger, when I finally learned how to set up for proper investing in the cryptocurrency market, Bitcoin had just touched $17,900…per coin. Hindsight being 20/20, it is the risk-reward scenario that both entices investors and leaves others sitting on the sidelines. The other aspect of sitting on the sidelines is lack of information.

Those that got on board early enough to realize a price swing of $17K in under ten years are the exception. The rest of the investor community can decide to educate themselves and develop an investment strategy early, get into the game late, or not at all. I say set realistic expectations, educate yourself, know your limits, and if you decided to get in the game, go long.

The fact is, in 2011, very few people knew how to enter the digital asset market. It was the wild-west of investing and it went square in the face of the regulated banking industry. Investment platforms were unknown, untested, and uncertain in the level of security they provided . Realistically, that was the perfect timing for a decentralized monetary system to come into the picture. Banks, big business, and governments across the world were sinking and when Bitcoin went live in 2008, it was making a statement in a huge way. A decentralized, peer-to-peer currency system. The belief in the banking system was at an all-time low and an opportunity to capitalize on the system’s failure was to be exploited.

We are ten years from the “Great Recession,” and have watched the stock markets rally to all-time highs. When the “whales” decide that they want to take their profits, the house of cards will fall swiftly. We have seen this with the meteoric rise and fall of crypto prices through 2017.

Simultaneously, we are witnessing the dawn of a new asset class: digital.
Remember how I said the early years of cryptocurrency were the wild-west and the digital asset community was standing square in the face of regulated banking? A decade later, we see a concerted effort to bring the digital asset community into the same system of regulation that fails at least once in a generation, if not more. That’s just how it goes. The US government is in play when it comes to the digital currency market with regulations, tax law, and policies. Many in the cryptocurrency world believe that a decentralized approach is best. Other minds see the regulating authorities as the appropriate method to bring economic stability

Fortunately, we are at the very beginning of instituting this new class of investment vehicles, and that can have long-term benefits. We may or may not see the hyper price increase that was seen with Bitcoin over the past ten years. Many would state that the prices were wildly manipulated to achieve such highs. Others, however, believe that we are just at the beginning and the coin market will see a “flippening” where Bitcoin (BTC) loses its current spot as the number one token. I suggest reading the following thoughts on the possibility of a Bitcoin ETF as the SEC prepares to approve or deny its listing in the next couple of months.

Best,

Rand

 

NOTE: As the domain name of this site suggests, the content my blog posts are opinion and not investment advice of any kind. Do your own research before making any decisions to invest (or not to invest). I am not a financial advisor. I am simply sharing information I gather from across the web, news, and media outlets and drawing my own possible conclusions.