No, you cannot lose more than you invest in Bitcoin. It is based on one condition: you have to wait until the market cycles out to reach your purchase price.
The Bitcoin Market Cycle has Returned
to Regular Levels
Based on Bitcoin’s price activity for the past three months, we have seen a return of price levels to $10,000.
It has led people to think that Bitcoin prices won’t rise beyond $10,000. As Bitcoin prices continue to find their accurate support levels, the fundamentals have pointed to an upwards trajectory.
Now that Bitcoin prices have crossed $10,000, we would see new levels of price action.
It means that even if you bought Bitcoins at $20,000, you can’t lose more than you invest in Bitcoin.
Bitcoin’s Fixed Supply Ensures that You Can’t Lose More than You Invest in Bitcoin
One thing most naysayers don’t get is that unlike fiat money, Bitcoin and other cryptocurrencies have a fixed supply.
It is this fixed supply that will ensure the continuous value of Bitcoin as a cryptocurrency.
Most fiat money systems give this false idea that fiat money has a fixed supply. There is always one form of new supply of money or the other that is ongoing.
It is why mechanisms such as interest rates, quantitative easing, and others exist.
Bitcoin’s fixed supply ensures that stable liquidity and a growing market will provide high-rising demand to maintain its dollar value.
Bitcoin is Cheap at $10,000
As it stands, Bitcoin at $10,00 plus is relatively cheap. This cheap pricing is another reason why you cannot lose more than you invest in Bitcoin.
We are seeing the rise of new whales that are taking over the cryptospace currently.
Institutions are taking note of the fact that Bitcoin can serve as a hedge against economic uncertainty. The reason behind this (trustlessness) is antithetical to traditional banking and economics.
It is also one of the main drivers of growth behind Bitcoin prices currently.
As the world continues to reel from the effects of the COVID-19 pandemic, we shall continue to see the economic effects at play.
It is also one of the reasons why retail investments in Bitcoin and other cryptocurrencies will rise.
Millennials are looking at a way to balance out their retirement portfolios. Bitcoin and other cryptocurrency investments are one such way to get this done.
The Bitcoin Purchase Cycle Will Grow With a Rise in Cryptocurrency Education
At this time, anything and everything that has to do with technology are taking center stage.
Humanity is experiencing a culture shift from the old ways of doing things to the new.
Technology is the new standard. Any technology that has to do with finance is now at the forefront of the current set of disruptions.
Though people misunderstand Bitcoin and the other cryptocurrencies, people have still keyed into the new glorious financial age that is coming.
Based on this, the Bitcoin purchase cycle is growing and is one of those trends that will make the new decade remarkable.
We are Going to See Huge Spikes in Bitcoin Prices
This shift is already occurring in the stock markets. The world’s most capitalized companies are mostly technology companies.
Digitization has, in essence, saved the global economy. Even without a readily available vaccine, the world hasn’t come to a standstill.
If anything will keep the Bitcoin purchase cycle going, this is one of those factors.
Prices will shift markedly upwards as the rest of the world goes digital.
Bitcoin’s Zero Inflation Will Bring Out Its Inherent Value
One truth for anyone who understands how monetary and financial systems work is that Bitcoin has a hugely untapped inherent value.
It is this value that the HODLers are considering. It is also why anyone who studies Bitcoin’s blockchain gets into the game headfirst.
Bitcoin’s characteristics: Fixed supply, trustlessness, transparent blockchain, Byzantine Consensus, and lack of central ownership have given it real value to all and sundry.
It is in this stead that the marketplace will get to decide how the world’s first decentralized digital asset gets priced ultimately.
This factor also ensures that you do not lose more than you invest in Bitcoin. As adoption rises, the marketplace will shift towards cryptocurrencies.
Bitcoin prices will also face an exponential rise as this occurs. Distributed Ledger Technologies (DLTs) will now take center stage as opposed to legacy systems that have various problems at this time.
The above-described characteristics of Bitcoin are what give it its zero-inflation value.
Based on fixed supply, there is no way that the cryptospace will be awash with Bitcoins. So much so that the community of miners has to vote to change the code. It is something that is an uphill task in itself.
The Byzantine consensus also allows for community-oriented confirmation of the information entered into Bitcoin’s meme pool. It is where transactions are cached for Miners to pick up and confirm in blocks.
As the crypto space continues to grow and expand, we are going to see more factors that will ensure that you won’t lose more than you invest in Bitcoin.
This time, these factors will stay in place. Unlike in 2017, when everyone wanted a piece of the pie without solid fundamentals.