Imagine discovering an investment that goes up 50% on average each year with occasional big drops that you can buy for even further gains.
Would you buy it?
No.
What if that asset went up 10% on average each year? Would you buy it?
Yes. Chances are, you already have. I’m talking about Bitcoin.
You pay a high price for a cheery consensus
That may sound weird. Stupid, even.
Who would turn down a 50% opportunity in exchange for a 10% opportunity? The US stock market only gives you 7% annualized.
I agree. Yet, that’s what people do when they buy Bitcoin during bull markets like today’s.
They don’t buy Bitcoin for $16,000, $32,000, $48,000, or $64,000. Instead, they buy it for $80,000 or more. They heard some people got ridiculously rich with Bitcoin and think they can do it, too.
Two years ago, maybe. That was during the depths of a wretched crypto bear market.
Now?
One Bitcoin is worth more than the average US worker's annual salary. Bitcoin's market cap is almost $2 trillion.
