Is Bitcoin an investment or not?

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There is no shortage of speculators and skeptics in the cryptocurrency sphere. The truth is, I believe, that no one knows what they’re talking about and no one can predict the future. It’s too new to be an expert. Every prediction has been blown away by the market’s performance.

You have your traditional Wall St. guys who are bearish or skeptical of Bitcoin. I believe it’s because it’s a direct competitor.

Why put your money into the stock market or a poorly managed investment group for only 1-8% gains when Litecoin is up more than 5,700% this year?

Wall St. can’t promise returns like that!

Crypto is completely different from anything these investors have EVER seen. It is incomparable. For them to be adamantly against crypto, with their biased opinions, is just downright dishonest and unfair to their audience.

litecoin December 2017chart

Cryptocurrencies, like Bitcoin, defy all logic when it comes to investing. It’s not a shock to see the traditional investors pulling their hair out. I think many of them are just envious because they didn’t get in early or are too scared to get in now and risk losses, so they try to deter others from investing.

Don’t listen to them.

Then you have your bullish crypto investors, who act as if Bitcoin and other alt-coins are God’s gift to humanity. Many of these have no traditional investing sense or strategy.

They’re just looking at this thing as a get rich scheme.

I’d say if you’re looking at crypto as a get rich scheme, you’re in the wrong business.

Is Bitcoin an investment or not?

Before we say if Bitcoin is an investment or not, let’s first define what “investment” means.

Revered investor, Warren Buffett, describes investing as “…the process of laying out money now to receive more money in the future.”

Going by this definition, if you’re placing money into a crypto coin for the purpose of making a return, then you’re investing.

Traditional investors are going to ramble on about currencies not being an investment vehicle and blah blah blah. And a whole bunch of technical jargon that nobody cares about and only impresses other “suits”.

They’re going to talk about volatility and blah blah blah.

It’s not backed by anything and blah blah blah.

I only have one question. Is it going to bring a return or not?

If it is, then it’s an investment.

Don’t bombard me with your fancy Wall St. lingo which means absolutely nothing. Your best hedge funds struggle to return 7%.

So, all that technical mumbo jumbo means what? Nothing.

Let’s not get into black box trading, with ultra-fast processors and complicated algorithms. These machines (although profitable) still aren’t competing with the returns from crypto-coins.

Reality

When you were fed the dream of owning a home because “it’s a great investment”, how did that work out for the millions caught up in the housing crisis? What about the Dotcom bubble?

Weren’t those classified as “investments”?

People ruined their lives with those decisions and so-called investments.

When you buy a stock, people call that an investment. But it can crash and you can lose your money.

When you buy a piece of equipment, people call that an investment. But a new machine or system can enter the market and render it obsolete causing you to lose your money.

If these vehicles can be considered investments, why not Bitcoin?

Invest Responsibly

Although I’m bullish on crypto, that doesn’t mean you should pour your life savings into it. Please invest responsibly. Don’t gamble more than you can afford to lose.

Typically, you want to invest about 10%+ of your earned monthly income. I’d suggest a diversified portfolio that includes both crypto and Wall St. mutual funds, like $SPY.

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For those new to Bitcoin and crypto investing I made this Bitcoin tips, tools, and tricks tutorial just for you.

Many people are going to give advice on crypto and I’d like to say, DON’T LISTEN to them. Whether they are optimistic or pessimistic, DO NOT LISTEN. Simply take the information they offer and use discernment to filter the useless from the useful.

Look for facts and not opinions.

For example, when people say Bitcoin is a bubble or not a bubble, that’s speculation. You can ignore that stuff and listen to your own intuition on the matter. But when someone says buying is down by 50%, that’s a fact and an indicator of performance.

I suggest you educate yourself on general investing to understand what this stuff means so you can make your own educated decisions.

What you need to do is figure out how much of a return you want to make then sell. That will guarantee your return and people can’t say that it wasn’t an investment.

Final Thoughts

I know I said don’t listen to speculation and but here’s mine. 😂

Litecoin will surpass Ethereum at some point but Ethereum will have longer staying power because they are focused on contracts.

Ethereum has already inked a contract with a Russian bank. That says much about their business model.

However, Litecoin is dedicated to being a pure crypto-coin, which means it will be more popular among the everyday person. It’ll be the recognizable household brand which will make its value higher.

But by being a pure crypto-coin means it’s highly susceptible to competition which affects its longevity.

I like ETH (Ethereum) as a long play and Litecoin (LTC) as a short play. Of course, Bitcoin is big momma, so bets should be placed there as well.

Are you bullish or bearish on crypto-currencies? Leave a comment below and let me know.

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You give good advice. I’m curious to see which crypto currency ends up backed by a stable country. That’s the one I’m going to invest in.

My problem with crypto is there’s a limitless number of new coins that can come out. All of them highly volatile, and all of the contributing to inflation of crypto currency overall. I love the idea of decentralized currency. I hate the idea of the bottom falling out of the one I picked because some other one gets hot and goes through the roof. Currency needs stability. We all bitch about the fed inflating currency. Well anyone can create their own crypto coin and no one nows which coin is going to get hot or which one the bottom will fall out on. I hate the idea of having to keep an eagle eye on 25 kinds of crypto & trying to sell one before I lose my money if it goes down.