Bitcoin, Cryptocurrency, and the Future of Currency

March 2, 2021

Share This Post

Should you invest in Bitcoin?

I am being asked all the time about investing in Bitcoin, the coin or in another form. In just about a year, the value of Bitcoin has gone from $8,600 to $49,000, a ridiculous amount of growth, much of it fostered recently by famous folks, including Elon Musk with millions of followers, investing heavily.

What is Bitcoin?

So, what is Bitcoin and is there a real metal coin?

Bitcoin is a cryptocurrency (an internet currency with a limited supply) that was created in 2009. No one directly owns or controls it, and anyone can buy and sell it. The value of Bitcoin is based on supply and demand, much like gold. As a matter of fact, some speculators believe that Bitcoin is the future replacement for gold. The use of Bitcoin is recorded on a shared public ledger that anyone can access, and this is called “blockchain”. Theoretically, everything here is transparent and public. Scams are hopefully prevented with a form of your “signature” and transactions are confirmed using “mining.” There are strict rules here.

Bitcoin is part of the Cryptocurrency movement. Various internet “coins or currencies” are used and include Bitcoin, Litecoin, Monero, Bitcoin Cash and Dogecoin. These currently can be used for loans, bartering and actual purchasing, assuming that a firm will take your currency in exchange for goods or services.

What You Need to Know About Bitcoin

You should be as these are not yet mainstream.

Moreover, I would categorize the buying and selling of Cryptocurrencies as speculative rather than long-term retirement investing.

But, that does not mean there isn’t money to be made quickly, or lost quickly (the disclaimer, caveat emptor, or “buyer beware,” applies here). Investing in this medium is not for the faint of heart, or for those strictly focused on building their long-term wealth with a solid strategy.

Elliot’s Evaluation

Why have the US Government and the European Union allowed these Cryptocurrencies to exist?

This is a question that baffles me.

As a proud US citizen, I do not like any currency potentially challenging the sovereign US Dollar, and unchecked, Bitcoin or another currently could someday do this.

It is also possible that the US Treasury in Washington and Euro, managed and administered in Germany, could step in and make these new Cryptocurrencies immediately obsolete in the United States and in Europe in order to protect sovereignty.

Closing Thoughts

I believe that like all new shiny toys and cars, Bitcoin has captured the fantasy of many get-rich-quick folks. There can be gold found in “them there hills”—meaning, lots of money can be made and lost along the trip… But for most investors, beware of buying high and then being forced to sell when or if the bottom falls out.