Is Bitcoin a good long-term investment? In 2023’s first quarter, Bitcoin recorded a wonderful performance with an awesome growth of 73%. However, you need to know the reason behind Bitcoin’s growth. You need to refer to its historical period and genesis.
Bitcoin was designed to fight the traditional currencies’ influence, which is under the control of the central banks. The virtual currency, Bitcoin can break the traditional currencies’ hegemony. This year, the situation is similar to the crisis in 2007 and 2008. Now, does it affect the opportunity of Bitcoin?
The Safety of Bitcoin as A Long-Term Investment
In 2007 and 2008, a lot of banks were in trouble and this made central banks rush to print money and bail those banks. Printing money is actually a beginning of a disaster. This activity is going to increase public and private debt.
It becomes very clear that government deposits and bonds in local banks are actually not safe enough. The tension leads to an increase in demand for cryptocurrencies, especially Bitcoin. Bitcoin cash is currently acting as gold, the quintessential safe haven asset.
In the first months of 2023, everyone can see that Bitcoin is a resilient currency since it gains ground in weeks of ups and downs. Bitcoin is becoming better and better as regulation evolves.
Is Bitcoin a Good Long-Term Investment?
People have had an interest in Bitcoin since years ago. In the latest survey, about 36% of 300 financial advisers said that their clients have crypto assets. Bitcoin is now offering huge advantages for many investors around the world. In 2020, its performance was better than gold.
The value of Bitcoin continues to increase and today is still its early day. It is not too late to join the long-term Bitcoin investment. However, Bitcoin is like any other investment, it has risks. Before investing in Bitcoin, there are rules you need to learn.
1. Think long term
Bitcoin has been on the market for at least ten years. This may make you think about whether is Bitcoin a good long-term investment. Many people made money from Bitcoin. But if this is something new for you, then you need to do a slower approach.
Bitcoin has value but you shouldn’t see it as something that makes you get rich instantly. As with any other asset, you need to take a long-term, methodical, and consistent approach if you really want to enjoy excellent returns. Bitcoin has more taste but it also has less speed.
2. Don’t be scared of fluctuation
If you want to see Bitcoin as a better long-term investment, you shouldn’t be afraid of fluctuation. Many people always want to know the best time to sell and buy Bitcoin. Of course, the traditional answer will be: sell high and buy low. But it cannot be done very easily.
Even some established investors may struggle in timing cryptocurrency markets. To see whether is Bitcoin a good long-term investment, you need to look at the chart that will map Bitcoin price. Some zig-zag may scare new investors in the cryptocurrency market.
However, short-term volatility like you see in the chart will disguise the long-term value increase. That’s why you need to master the first point above so that you won’t be scared of the fluctuation shown by the chart.
3. Use long-term strategies
The unpredictability isn’t the only characteristic of Bitcoin. This cryptocurrency has provided awesome opportunities for investors to earn profits. Many crypto investors have been successful in building their Bitcoin holdings steadily. It is all because of the use of an investment strategy called dollar cost averaging.
This dollar cost averaging is a practice of investing a specific amount of money, especially on a regular basis, instead of investing a huge sum of money. The strategy will also help you time the crypto market perfectly. With this strategy, you can combat some price volatility events.
As long as you know and follow the three rules above, you can see Bitcoin as a good investment. Keep in mind that Bitcoin will not make you rich instantly and you’ll be ready.
So, the answer to whether is Bitcoin a good long-term investment is yes. Bitcoin will give you beautiful returns in the long term instead of the short term.
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