Part 6 #StartInvestingInCrypto
4. Asymmetric bet
My goal is to become financially independent as quickly as possible. For that, I want to make asymmetric bets — very high risk and high reward bets.
Bitcoin is currently trading around $68K as of writing. It’s the only liquid and accessible asset that has the potential to increase by > 50X in the next 10 years.
It has been the best performing asset in the last 10 years and I think it will continue to be so for the next 10 years.
5. Strong Fundamentals
Bitcoin was invented only 14 years ago and it’s no longer a niche product used by tech geeks.
Over 18.5 Million bitcoin have been mined and more than 700K people have more than 1 BTC.
Bitcoin’s programmatic supply schedule is beating the fed’s systematic money printing.
Bitcoin network is the most secure computing network in the world. There has been an 5x increase over the last three years, which includes the 2022–2023 bear market.
These fundamentals continue to paint an optimistic case for Bitcoin.
Risks and Limitations
Like any other asset, there are myriads of risks. Here are the ones I’m concerned about:
Bitcoin still has this image of a speculative tool. Several institutions have adopted it this year and a ton more will do it in 2021 when the real FOMO kicks it. However, it still doesn’t have that mainstream adoption to take it to next level yet.
It’s decentralized so it will face a lot of resistance from banks, governments, custodians before it gets mainstream adoption it needs to become a more stable store of value.
It’s been 14 years since it’s launched and we still don’t have a major utility. For me, the ideal utility for it would be remittance as that’s a ginormous market that Bitcoin can disrupt. This is already happening at a small scale in developing countries but due to Bitcoin’s volatility and the cumbersome process of BTC to USD settlement, it’s not prevalent yet. But I’m optimistic many big companies will solve this problems.
It will prove to be a great store of value in the long term.
