3 Reasons Why Bitcoin Is one of the Strongest Long-Term, Risk To Reward Investments
The following article is my own personal opinion and should not be used as financial advice. It is for educational purposes only. Please do your own research.
There will be many winners and many, many more losers in the exponentially evolving cryptocurrency space. Bitcoin in my opinion remains the strongest cryptocurrency to hold in your portfolio and just might replace the US dollar as the new global reserve currency in the future.
Here are 3 reasons why Bitcoin remains the strongest long-term risk to reward investment:
1. It has widespread institutional adoption from publicly traded companies, private institutions, and governments.
Tesla, Starbucks, Microsoft, El Salvador, and Georgia are some of the many institutions that have bought and stored Bitcoin on their balance sheets, which can be seen on Bitcointreasuries, a website that details how many Bitcoins are held by various institutions
Other institutions include a US pension fund, called the Houston Firefighters Pension Fund, which recently purchased and is holding Bitcoin in its portfolio. I think we’ll inevitably see more pension and superannuation funds adopt this strategy as real estate and equity prices around the world continue to reach higher all-time highs as they are artificially inflated through the printing of more money and as the debt ceiling rises higher. Pressure is beginning to mount on pension and super funds to allocate funds accordingly and generate profit for the millions of people around the world that will be exiting the workforce.
2. Bitcoin is the ONLY cryptocurrency that is safe from SEC regulation and has passed the Howey test.
The entire space is trending towards much-needed cryptocurrency regulation, but as Sen. Ted Cruz has said recently, crypto should not be regulated when politicians and policymakers don’t completely understand it.
The SEC has recently stated, however, that Bitcoin fails to meet these 3 metrics (1) an investment of money; (2) in a common enterprise; (3) with a reasonable expectation of profit derived from the entrepreneurial or managerial efforts of others. This means that Bitcoin is not a security under the Howey test and is safe from SEC regulation.
3. On-chain Bitcoin metrics continue to strengthen the Bitcoin narrative
The narrative of bitcoin has drastically changed over the years. We've gone from an asset class that was used purely by cyberpunks, to a coin that was lauded as only to be used by criminals, to now being listed on balance sheets of public and private companies, governments, and millions of people around the world.
When we look at the data courtesy of glassnode: wallet addresses, addresses with non-zero balances, and total addresses are all increasing, signaling more widespread adoption
I believe in the power and sovereignty that Bitcoin can provide billions of people around the world. The kind of sovereignty that has been eroded by our current banking system.
I do not necessarily believe that the current financial system was created to enslave us all. Our current system is flawed but I think it was designed for a certain time and that it has served its purpose. The process of natural selection is taking its course and our current economic system requires evolution to help propel societies around the world to a new age of prosperity.
Old social, political, and economic systems are always guarded and protected and anything new and unknown will always be rejected and ignored, for fear of the unknown is stronger than acceptance of the new.
A word of caution: the cryptocurrency space is a continuously evolving narrative and although we have seen old social and economic systems rise and fall in the past, we have never had an engineered monetary system that is free from centralized control, nor have we had cryptocurrencies built using decentralized algorithmic systems.
I do not possess a crystal ball and neither does anyone else in this world. All you and I can do is constantly keep well-informed and updated in this space because things can change in this space quickly. Nothing is TRULY safe, everything is still speculative.
I’ll leave you with a sound piece of knowledge from billionaire Chamath Plihapitiya:
There are two types of investments: the first you trade with a shorter-term horizon simply because you believe that the assets price will rise. The second type of investment is an idea. An idea that Peter Thiel calls zero to one. An idea that can change the world and as a result, your time horizon for holding onto this investment is forever. I believe Bitcoin is that idea.
Feel free to reach out and connect or leave a comment below.
