Every time that Bitcoin reaches a new all-time high, people start to talk, and, almost inevitably, a single thought flashes across the minds of those who are not seasoned Bitcoiners (and, let’s face it, some seasoned Bitcoiners as well):
“Should I buy Bitcoin right now?”
Indeed, no matter how many times you may have heard the words “buy low, sell high,” the temptation can be strong. After all, as Rubix Chief Executive, Andrew Hamilton told Finance Magnates, “the best time to buy [Bitcoin] is always yesterday.”
The pull can be so strong: when Bitcoin is doing well, it is almost as if the moments when Bitcoin has suddenly crashed and burned are gone and forgotten, and if the belief is that Bitcoin will eventually be worth $100,000, then $30K may not seem like such a bad price.
Still, the eternal question remains: when is the right time to buy Bitcoin? Is it better to buy Bitcoin immediately (yesterday, in fact)? Or is it better to wait to see if Bitcoin will crash, and then buy in at a ‘discount’?
Or is it too late to buy Bitcoin altogether?
Risk Factors Vary Widely Depending on Investor Profiles
There are a few important things to consider here.
For example, the difference between BTC=$15,000 and BTC=$30,000 as a point of entry may not make such a huge difference for institutional investors or for some high-net-worth retail investors.
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This is particularly true if the belief is that Bitcoin will eventually be worth $100,000 or more; a few crashes and bumps along the road to $100,000+ may not make such a huge difference to someone who has more than, say, $50,000 in extra cash to risk on a Bitcoin investment.
Step 1: Resist the urge to buy Bitcoin at $32K
— Marques Brownlee (@MKBHD) January 3, 2021
Additionally, Mintz believes that “BTC is moving out of the early adopter phase, with big players choosing it as a hedge against traditional markets, and consumers beginning to use it for everyday life transactions.”
“Soon enough it will become a core part of every investment firm`s portfolio and a common payment method. In 2020 and beyond, BTC will be impossible to ignore.”
“The Problem with Trying to Wait for Market Corrections Is They May Not Happen at the Time You Want or at the Price You Want.”
Although, if Bitcoin does keep growing over the long-term, it is still likely that there will be some dips along the way, moments that could be prime opportunities for investors to jump into Bitcoin at a ‘bargain’ price.
However, “the problem with trying to wait for market corrections is they may not happen at the time you want or at the price you want,” said Alex Treece, Co-founder at Zabo, to Finance Magnates.
Indeed, Treece said that the most important thing to consider when investing in Bitcoin is not necessarily when to enter the market. Instead, the long-term strategy is the most important factor, particularly when it comes to planning investments.
“People should take a long term view with Bitcoin,” Treece said. “Trying to time the market is extremely difficult (if not impossible) for even the most sophisticated investors.”
“If you buy into the longer-term viewpoint that Bitcoin is a highly attractive, digital store of value, then right now is a good time to buy in the context of a multi-year investment horizon.”
Borys Pikalov, Co-founder of Stobox.io, also told Finance Magnates that “whether or not to buy Bitcoin depends on your investment horizon.”
“The short-term rise is unstable,” he said. “Many institutions who initiated the bull run below $25k have already made sizable profits and may liquidate their positions anytime.”
“However, in the long-term, there is still potential for the total increase in the market cap as BTC will be further recognized as a store of value by more conservative institutions and even corporations.”
What do you think about where Bitcoin is headed next? Let us know in the comments below.