So the question is, is Bitcoin a good investment? You see, since the beginning of the year Bitcoin is up over 60%, and especially in the past two weeks, cryptocurrencies got a boost. So in this video right now, I’ll show you the pros and cons of investing in cryptocurrencies like Bitcoin so that you can decide whether crypto trading is for you. So let’s get started. So the fascinating world of cryptocurrencies. Now before we talk about the pros and cons of investing in cryptocurrencies like Bitcoin, let’s talk about what it is. So what is Bitcoin or cryptocurrencies in general? You see, I’m using Bitcoin here because it is the most popular cryptocurrency there is. First of all, it’s a digital currency. This means there are no bills, no coins. So you don’t have a one-dollar cryptocoin, Bitcoin or you don’t have a ten Bitcoin bill or something like this. It doesn’t exist. It only exists in cyberspace. So it was introduced since 2008 by somebody, and we don’t know if this is a person or if this is a group of people and the name is Satoshi Nakamoto.
You don’t need to know this, but you need to know the idea behind Bitcoin. So the idea was to have a worldwide decentralized system. And the idea was that this is much better than being a system that is controlled by banks or the government because this is where many people say that banks and government can manipulate currencies. And especially right now, we are seeing that governments all around the world basically put the printing presses into overdrive and are printing money like crazy. Now, this is also where Satoshi Nakamoto said that there will be no more than 20 million Bitcoins.
So that’s it. So Bitcoins are being mined and there will be no more per definition than 21 million. So it is not possible to artificially inflate it or by just mining more and more Bitcoins. And by the way, the mining shall be completed, I believe, by 2140 or 2040, not quite sure. So I would have to look this up. So don’t quote me on this one. Anyhow, what we want to talk about right now is, is this a good investment, right? I mean, people like to invest in gold.
And here the question is, does it make sense to invest in Bitcoin? So let’s talk about the pros here. First of all, people who love investing in Bitcoin say, “You know what? It is a great investment because it can only go up.” And here’s what they are arguing. They say, “Because we have a limited supply.” And that is true. There will be only 21 million Bitcoins. There cannot be more than 21 million Bitcoins. The algorithm is programmed this way that there can’t be anymore. Secondly, the pros of this is that it can’t be inflated by printing more money, right? And you know that this is what’s happening right now all around the world to get through this pandemic right now. Governments around the world are printing more money. So we might see in some currencies inflation, deflation. I mean, all the good stuff that everybody tries to avoid in the first place.
So also, number three, everybody says, “Well, you know what? It’s the new currency.” That’s why they say, you know what? These days, if you think about it, I mean, we are pretty much already paying cashless, right? I mean, credit cards are being used. Now we have Apple Pay, for example, where you can pay with your phone. So in order to arrive in 2020, this is where everybody says, “Well, you know what? It is the new currency here and everybody should get used to it.” But let’s talk about the cons here, because it’s also important that you know this.
And then, as you can see, I’ll give you a summary of what I think, whether it makes sense to invest in Bitcoin or not. So, first of all, the assumption is it can only go up. And this is where I say, “Hell no!” Let’s take a look at the chart here. So here we have a chart of Bitcoin and if you’re going back to the beginning of Bitcoin again, it started in 2008, I believe that the paper was published and then it started trading. And at first, it was only trading at a few cents. I don’t have enough data here, but you get the idea. And then at some point in 2017, you see here, Bitcoin got so popular that it went from a few hundred dollars to more than $20,000 per one Bitcoin in a matter of weeks as you can see here.
But then what goes up must go down, then it crashed all the way down to $3,500. And right now we are trading at $11,300. But as you can see, the assumption that it can only go up is not a valid assumption, because in order to do this, yes, there is limited supply, but what do you need for price to go up? You need demand, right? And this means that it would need to be widely accepted as a payment mean. And right now this is not the case, and I’ll give you some stats here in just a moment. Now, it can’t be inflated by printing more money that is true, right? I mean, this is built into the algorithm, but then also that it is the new currency.
Well, I don’t know, because, again, it was introduced in 2008, actually. Gained really popularity in 2017 because in 2017 it went from a few hundred dollars to $20,000. But you see, as of right now, Bitcoin is only 0.4% of the world’s money. And now you might say, “Well, this is only Bitcoin. There are way more cryptocurrencies.” Which is true but all cryptos combined only account for 0.7%. So it’s not really the new currency just yet. Now, not saying that it couldn’t happen, but let’s talk about whether it makes sense for you to invest in Bitcoin and whether I’m personally investing in Bitcoin or not.
First of all, I am a trader, so I’m always curious can we trade? Is this good for trading? Meaning that you’re entering and exiting within a few days. And actually you need to know that it has lots of volatility. So right now, it moves 4% per day on average. So that’s a lot, right? So within a few days, it can move 10% – 15% in your favor as well as against you. But let’s talk about actually whether it is good for investing. Because this is where most people, when they look at cryptocurrencies, they say, “You know what? Why don’t I invest a few thousand or a few $10,000 into Bitcoin or a cryptocurrency? And then well everything will be fine, maybe in 10 years or in 15 years, it will be at some say a $100,000.” But let’s talk about it again.
We know that the limited supply is good, but it needs to have demand. And in order to have demand, it needs to be widely accepted. Now, think about it this way right now, a coffee if you’re buying a coffee at Starbucks, it would be $4, right? Easy enough. So in order to pay for a Bitcoin, it is 0.000363636 BTC, Bitcoin. Now, let me just come back to you really for a moment on fullscreen. How many zeros did I have there? Two, three, or four? You get the idea. You see, it’s really difficult for us to think this way. And now you might say, “Well, it doesn’t really matter because it’s all electronic and we pay with the phone.” Well, first of all, we need to get used to the idea that a coffee costs 0.0003636 Bitcoin here.
The other thing is it might at some point replace other currencies or gain more traction. But right now, keep in mind, you can’t touch it. And for many people, this means, is it real, right? If it doesn’t exist, if you can touch it like gold, for example. Gold, when you buy it, you can put it in your safe. Silver, you can have silver coins you can put into your safe. Money, you can have money, you can put it in the safe. I mean, cryptocurrencies you can’t put in your safe. And for some people, this is deterring where they say, “Well if I can’t put it in a safe if I can’t touch it, it is not real.” Again, just keep this in mind, thinking about whether it will be widely expected. And also there’s lots of competition. So right now there’s 1,300 cryptocurrencies and there’s more introduced every year.
So now the key question is here, will there be a better one than Bitcoin and will maybe one other rise to the occasion? So in summary, what do I personally do? Well, I personally do not have any bitcoins. I’m not invested in bitcoins and right now I don’t really see that Bitcoin is about to take off in the next year or two. It might be in 10 years, in 20 years, in 30 years. Who knows, right? But right now, I don’t think that it is a good investment. Also looking at the chart, I do believe that the ship has already sailed. Yeah. Going back, I mean, it would have made sense to invest in cryptocurrencies when they were only a few hundred dollars. Now that it is $11,000, sure, it could go all the way to $100,000, as some say, or it could crash and burn and go back to $3,000 or $2,000. So it is a super, super risky investment. Now, again, I don’t believe that Bitcoin is a great investment.
I believe that there’s other possibilities, better investments, or as you know me, I believe that when you’re trading, you will run circles around Bitcoin traders. Anyhow, hope that this was helpful, if you enjoyed this video make sure that you like it. And also, if this is your first time here and you would like to see more videos like this, subscribe to this channel, hit the little notification bell, because this way you get notified whenever I release a new video.
Hey, talking about other videos, I’ll link to a few videos in the description, and also there’s probably a few popping up on the screen right now. So I’ll see you in the next video..