Can Bitcoin make you really rich? Can I become a millionaire if I invest in Bitcoins? How can I get rich by investing in Cryptocurrencies? These questions are natural to pop in mind if you’re getting started with crypto trading. In this article, we will talk about the possibility of getting rich using Bitcoin. Also, we will learn how to actually use this knowledge to better our trading portfolio.
Bitcoin is widely known as the first Cryptocurrency. ‘Satoshi Nakamoto’ which is the pseudonym of Bitcoin’s creators, posted a link to a paper titled ‘Bitcoin: A Peer-to-Peer Electronic Cash System’ to a cryptography mailing list. Being the first Cryptocurrency, it’s widely popular and the most valuable Cryptocurrency as of now. This trend is expected to continue as bitcoin is getting more popular and many businesses now accept it as payment.
Recent news has somewhat exaggerated the possibility of getting really rich by Bitcoins. They often talk about people such as Erik Finman who at the age of 12 invested $1000 which is worth more than $5 million today. But is it really possible for us to replicate his success? The answer is quite tricky, as with the example of Erik Finman he invested those Bitcoins in the early days. In those days Bitcoin’s value was really low.
Strategies and expectations while investing in Bitcoins
Bitcoin has reached the value of $55,000 as of the date this was written and is expected to rise gradually. Bitcoin surged over 90% in the year 2020-2021 so the ‘returns’ as an investment is quite high. However, even if it’s quite high, it’s still not as much to make one really reach.
Here’s the catch, the getting really rich from Bitcoin days are far behind, but we can use Bitcoins to wisely invest our money to give us some nice returns.
Expecting an unbelievable return is not quite right, but good returns can be obtained if a person wisely invests in BTC purchasing at times that are considered ‘dips’ which is the time when the Cryptocurrency has declined in value.
Also, holding BTC will still increment the value of your money but not as much as to make you a millionaire.
Risks and Rewards
If you look at crypto value charts you’ll notice a feature showing a lot of sharp spikes and trenches, which shows how quickly their value changes. Given the turbulent nature, investment is highly speculative and nobody can predict what the future unfolds.
What showcases the volatility of Bitcoin is the sudden changes in its value. With the depreciation of as much as 20% of its value, Bitcoin takes huge dips in value. But many people see this as an opportunity to buy cheap Bitcoins for their portfolio.
Higher the risk we get a higher reward this is fairly simple. However, one must take calculated risks to not lose everything and see our assets turn into nothing. This is entirely possible and can happen to anybody, this is why education and knowledge are so important before getting into Cryptocurrencies.
Creators of a cryptocurrency named after the Popular Web series ‘Squid Game’ executed a pump and dump scam in which a lot of people lost a lot of their money.
So, with so many ifs and buts, we get to the question
Should I Invest in Bitcoins?
Bitcoin is so popular that it’s irresistible and really alluring. However, is it really wise to invest money in Bitcoin? This question can be answered on the basis of the strategy that you’re using to invest that sum. If you’re investing a large portion of your net worth then it’s not as wise as some may say, as if the Crypto takes a dip of 10%. Then the value of the portion of your worth will lose 10% of its value!
Also, to handle the volatility and unexpected changes in BTC values, a person needs to be financially stable which many new investors fail to assure. Bitcoin is nothing but another mode to wisely invest money and with the promises of great return, the risks are also high. A wise investor hopes for the best, but is also prepared for the worst. So, to invest in Bitcoin, one must make sure they’re financially stable enough to invest in Bitcoin and maintain their portfolio.
The Bottom Line
Bitcoin can certainly make you rich, but not as much as some people claim. Also, Bitcoins are really volatile and fluctuations happen really frequently. However, Bitcoin has proven itself to be a good investment with good returns almost every year. In the long term, Bitcoin has proven itself as a really valuable asset to one’s portfolio. Bitcoin will definitely increment and give great returns.