This might come as a surprise or maybe unorthodox but there is a lot of reasons why you should not keep your Bitcoin now and sell most of them off!
Not a move for everyone
Bitcoin has been making headlines since 2021 started especially when it has been breaching its highest price point several times. But it has also been going in the other direction as well. This is truly a risky market and if you do not have it in you to stomach it, perhaps it is a good investment move to just sell off your BTC and put your money elsewhere.
Rise and fall of BTC
If you have been investing in BTC for many years now, you would have known that the value of your coins has fluctuated tremendously. You might have earned thousands within a day and even lost that amount within hours too. If you are one of those, perhaps you should revisit why you bought BTC in the first place and that could give you a clearer picture as to why you should just sell them off!
It was meant to be a currency
Bitcoin was invented as a digital currency that is not controlled by a central authority. It was to be one that is distributed, anonymous and scalable. Like fiat currency, it should be accepted and reliable. But so far, where has that brought us?
- To date (2021), BTC can handle 4.6 transactions per second. For comparison, VISA can handle more than 45,000 transactions per second. As such, it has caused transaction fees to increase.
- Being anonymous can be a double-edged sword. Because of this, governments are imposing more regulations and a lot more will follow suit very soon. Anonymity has created a whole new set of problems in that it propelled bitcoin and other cryptos like Monero to be used for illegal payments. Imagine if your BTC gets stolen (although it is very secured). There isn’t an easy way to track down the thieves.
- It has been more than 10 years since BTC was created. There have been companies, universities, regulators and experts working on it and yet BTC is not as accepted as normal currencies. Whenever a merchant decides to accept BTC, it becomes big news! There are a lot of complexities involved and would take years before BTC becomes a common currency.
- Stability is a common issue – Think about it, can you trust a currency where its price can change about 10 to 15% in a single day? And we have not even talked about the crypto whales and other influencing factors that can easily sway their price.
- As an investment, you must bear in mind that there is a finite number of BTC (21 million) at one point. If you have been holding BTC for several years now, chances are you would be profiting from it by now. Instead of losing sleep over this, get it over and done with, once and for all and move on. Keep 20% of your portfolio and cash out the rest.
Perhaps someday it will become common currency and we can use it like how we use cash. But for now, holding to it will only add to your stress and pressure. The other money markets might be less risky.