Who would have thought the value of Bitcoin could worth so much today? Flashback to a couple of years ago, the picture of Bitcoin has often been painted negatively by the media due to a plunge in prices. If you had asked the average person, do you know what bitcoin is? – Their response would have been “I heard Bitcoin is crashing and the price is going down.” People were generally afraid of investing in Bitcoin even before they knew what it was. This might be shocking, but the truth is some people are now hearing about Bitcoin for the first time. Some institutional investors had underestimated Bitcoin’s potential, and, in their view, Bitcoin was a “bubble waiting to burst”. Now some of those same investors have changed their narrative and are passengers on the Bitcoin (Gilbert , 2020)bandwagon.

Witnessing the surge of the bitcoin price being publicized all over the media must be heart-wrenching for those who had every opportunity to invest but missed out. Then there are others who would have bought dozens of bitcoins during the early stages when the price was just a little under a dollar but are in dismay after pulling out of the game and selling them off.  Now that the price of Bitcoin has surpassed $50,000, many are dissuaded from making bitcoin investments. Let us not forget some of the unfortunate situations where some bitcoin holders are unable to access their accounts due to password complications (Lost Passwords Lock Millionaires Out of Their Bitcoin Fortunes, 2021).

Is buying Bitcoin a good long-term investment?

So, was investing in Bitcoin worth the wait? Of course, the answer is a plain and simple yes. Bitcoin has turned people’s dreams into reality. After years of waiting, many early investors are reaping the sweets from their Bitcoin investment. Imagine yourself being in a financial position where you can clear off outstanding debts, such as student loans and mortgages, or purchasing that dream home or car you always longed for. It must feel really good to be in those shoes. It is important to keep in mind that investing is a gamble, sometimes you win; sometimes you lose. However, having patience is a key ingredient to becoming a great investor.

Is there a correlation between Bitcoin’s price increase and Tesla’s investment in Bitcoin?

It is no secret that the CEO of Tesla Elon Musk has been vocal about digital currencies for a while now. Changes to his Twitter bio and vague tweets about digital currencies here and there may have affected the performance of bitcoin and other currencies like the dogecoin. But when you thought it could not get any better, then came the announcement from Tesla that they had bought $1.5 billion in bitcoin with plans to accept the currency as payment. As expected, this news broke headlines, and the price of Bitcoin soared even higher.  If this does not give the crypto industry hope, then I do not know what does. Based on the amount of profit Tesla has made from its investment in Bitcoin, I am sure other institutional investors are getting excited and are probably preparing to hop on board too. The world could witness something bigger if more institutional investors invest in Bitcoin and/or other digital currencies. I have a feeling the next big thing is about to happen (Elon Musk’s Tesla buys $1.5bn of Bitcoin causing currency to spike, 2021).

Reference

Gilbert , M. (2020, 12 17). All Aboard the Billionaires’ Bitcoin Bandwagon? Retrieved from Bloomberg: https://www.bloomberg.com/opinion/articles/2020-12-16/all-aboard-the-billionaires-bitcoin-bandwagon-not-so-fast-robinhood-traders

Lost Passwords Lock Millionaires Out of Their Bitcoin Fortunes. (2021). Retrieved from NY times: https://www.nytimes.com/2021/01/12/technology/bitcoin-passwords-wallets-fortunes.html

Elon Musk’s Tesla buys $1.5bn of Bitcoin causing currency to spike. (2021, 2 8). Retrieved from BBC: https://www.bbc.com/news/business-55939972