Why You Shouldn’t Invest in Bitcoin
Bitcoin is the Kleenex/Q-tips of cryptocurrencies; everybody has heard about Bitcoin and as the ‘first-mover’ in the world of cryptocurrency, Bitcoin reaps the benefits of being the name that people say when they refer to blockchain or cryptocurrency. As such, the price of Bitcoin is the highest out of the approximate 1400 cryptocurrencies – $13,968.40 USD at the time of writing this post versus second place at $2.636.66 for Bitcoin cash and third place at $1,373.28 for Ethereum.
Still, only those in-the-know are talking about the exciting world of alt-coins and tokens. I believe that blockchain will be revolutionary to the world as we know it; however, there are two main reasons why Bitcoin might not be your best bet.
Short-term VS Long-term Investment
Like many, you might be asking yourself, “Should I invest in Bitcoin?”. My answer is… Not now. With that said, blockchain is a technology that is coming whether you like it or not and it will be integrated into our lives like the internet is today. So, Bitcoin might get to $1,000,000 per coin but it will likely take at least a couple years.
In the mean time, I’m investing my money into other promising cryptocurrencies that aren’t valued very high at the moment but have a relatively high market capitalization. I have two main reasons for this:
- We are still early in the adoption of blockchain technology. Many people still don’t know what blockchain is… Never mind how much it can impact everyone’s day-to-day lives. If you could go back in time and invest in Google or Apple, would you? I sure know that I would! We are at the beginning of an earth-changing technology; don’t miss your opportunity to get involved on the ground floor.
- Bitcoin could go up by $14,000 this year but that would only double your money. Don’t get me wrong…doubling my money is a better investment than I have ever hoped to see; however, if a coin, that is currently worth one penny goes up to just ten cents, then you have increased your money by ten!…if that same coin goes to one dollar then you’ve just increased your investment 100 times!!! Many coins went from being worth pennies to dollars between 2017 and 2018. As more people realize the potential of blockchain technology in 2018, the first movers in various types of coins and tokens may go ‘to the moon’.
Personally, my intention is to make more than double off of my money with lower-priced coins and tokens and then reassess. If the situation is what it is expected to be then I will likely be putting some money into Bitcoin a year or two down the road from now.
Obsolete Technology
The second reason why I’m not investing in Bitcoin is due to Bitcoin’s obsolete technology.
The biggest thing going for Bitcoin is the current market share that it holds. About one third of all cryptocurrency in the world is in Bitcoin. If this remains to be a fact moving forward then Bitcoin will definitely see some huge gains. While I think Bitcoin isn’t going away any time soon, the fact remains that the technology in which Bitcoin was generated is open-source.
This means that anyone can dedicate time to learn how to create their own Bitcoin-clone currency. This has resulted in many people created coins and tokens which are believed to be improved versions of Bitcoin but with specific functions.
- Quicker transactions – I’m not sure that many people will want to wait 10 minutes for a transaction to be processed when it could be processed in seconds with other coins.
- Low fees – the fees to transfer Bitcoin aren’t cheap. Coins, like Ripple, are offering low-cost transactions.
- No fees – some coins, like IOTA, are even offering no fees.
Can Bitcoin just improve their coin? The big changes that would be required can’t be done and may result in part of the development team creating a new, but related, coin. This is called a hard fork; when the developers can’t agree on which path to take which resulted in the creation of Bitcoin Cash – offering a quicker transaction time.
Conclusion
A $14,000 increase in the price of Bitcoin would double your investment while a $1 increase in a penny coin would result in having 100x your initial investment. Even a more likely scenario of a penny coin going to five cents or a coin worth twenty cents going to one dollar would increase your investment 5x!
Bitcoin costs too much and takes too long to use when compared to other cryptocurrencies out there which may result in a more educated public choosing a different coin which better suits their needs.
If Bitcoin keeps its market share by the end of the year then I will be re-evaluating my portfolio but until then I will stick with my cheap coins in anticipation of the likely growth of the cryptocurrency market as a whole which could result in returns over 100%.
Do you have a different opinion on Bitcoin? What coin are you hoping goes to the moon in 2018? Comment below!
Always here to help,
Justin
justin@investwithcryptocurrency.com
Invest With Cryptocurrency; Grow Money
I agree with your penny coin idea. Like you said, bitcoins might be “hot” right now, but obviously it has gotten a bit too hot. Too many people know about it, and its prices has jumped a bit too far.
Maybe you can still double your earnings by investing in bitcoins, but with the downsides to it like slow transaction speed, and transaction fees, I think I am better off investing in penny coins like you mentioned.
It is kind of like penny stocks. If I knew what amazon stock would be worth today, I would’ve dumped all my assets into it years ago. However, we still have a chance with penny coins. What do you think?
Thanks for the comment Win! And, I definitely do agree. There are many other cryptocurrencies out there that out-perform Bitcoin in transaction costs and speed.
I know the majority of my cryptocurrency investment is not in the top 10 coins from coinmarketcap but rather lesser known coins like NewYorkCoin – it is faster and cheaper than Bitcoin. Amazon would have been an amazing investment!
What’s your favourite penny coin, Win?