A lot of investors entered the Bitcoin market with the impression that it is quite the same as investing in the stock market. While the experience might help, it is not the same thing. It gives you the knowledge of money and economics but it will not work the same way especially when the Bitcoin Bubble is happening and does not seem to be bursting yet.
A whole new world
The fact is you do not necessarily need to be an experienced investor (in stocks) to invest in Bitcoin. The common practice with the stock market is that:
You should not invest when the stocks are high. It is a common practice that you want to avoid buying shares when the market has just breached it ATH or all-time high. In January 2021, BTC reached its ATH at US$42,000 and then it hit again in April 2021 with US$63,000. That prompted many to ask if it is too late to buy BTC. This rally has been going on since the end of 2020 and many investors are concerned as to whether it is still possible to invest in BTC.
Waiting for the best price to buy?
The price of BTC should hover around US$35,000 (June 2021) and many are now asking if it would fall below US$20,000 again. One thing for sure, it would not fall below US$10,000 for a long time. While the COVID-19 pandemic did influence BTC price drastically, no one can say for sure if such a global event could happen again. There will not be a ‘best time’ to buy BTC. This is one investment you need to do constantly and do it well.
So, is it too late?
Make no mistake about it, BTC is still one of the most undervalued assets out there. If you buy BTC today, you will still be among the early adopters. You need to HODL (Hold on to Dear Life) it for the next 5 to 10 years at least. If you can wait it out, your returns will be there.
- Use the DCA approach. This Dollar-Cost Averaging model is a common practice and is often provided by the application you use.
- Direct the application to store your BTC to your hardware wallet.
- HODL and then repeat this monthly.
By averaging the cost that you are buying the BTC with, you will worry less about what you invest in. over the course of a year (or two), you would have averaged your investments and the price that you bought the BTC with.