With Bitcoin Down, Is it Time to Invest?

Bitcoin is quickly dropping, and people are losing it. We recently discussed the roller coaster that is Bitcoin (BTC), and why this shouldn’t be too much of a surprise, but those who are losing their money aren’t going to care about previous trends. It’s important that we break down the cost of BTC and how it impacts everyone and their investment portfolios.

Is Bitcoin worth the price?

As of writing this, July 8th, 2024, BTC is trading at $55,532. It hasn’t been this low since February 27th, 131 days ago. This means that pretty much everyone who has invested in Bitcoin since late February is losing money on their investment. March 12th-14th marked highs for BTC, trading $72,000-$73,000. As prices increased, many saw the opportunity to jump into Bitcoin. “The price just keeps going up, what’s there to lose?” To answer that question, there’s about $17,000+ to lose, or almost a quarter of their investments.

Losing a quarter of any investment within just a few months can be concerning to even those most veteren investor. However, as we previously discussed, BTC is known for its eratic price increases and decreases. So, is Bitcoin worth the price now that it’s dropped so extensively? To answer that question, we should first understand one thing: the price still might continue to drop. That being said, it could skyrocket to new highs within a few months, and anyone who looks to make that investment might turn their $1,000 into $1,250 with a blink of an eye.

Is Bitcoin too expensive, even at its lower price?

The short answer: no. The long answer: it will likely never be too expensive. But we need to dive more into this. First of all, no one is required to buy a full coin. Anyone can buy limited investments at anytime, and most can even spend as little as $1 for their investment. The $55,000 price point is irrelevant to personal investing. As long as the price continues to increase, which it currently isn’t but that’s besides the point, the total is not important. Let’s do some math:
Let’s assume you make an investment a $1,000 investment today, with a price point of $55,532. If you decide to sell your Bitcoin in one year from now, and the price of Bitcoin is $100,000, then you’ve almost doubled your money. Your $1,000 is now worth $1,800.76. Maybe you invested $10,000 at the $55,532 price point, then the math is easy, and if the price still increases to $100,000, you now have $18,007.60. The price of a single coin is irrelevant to your investment.

Should I Invest?

This is the most difficult question of all. Bitcoin will likely continue to increase over the next several years, or ultimimately fail (though the later scenario is unlikely). In this case, investing in Bitcoin may end up being a strong investment for many who decide to go that bath, albeit an extremely stressful one. Whether or not you decide to invest is completely up to you, your tolerance for risk, as well as your tolerance for stress. If you decide to invest, my recommendation is to avoid the stress of constantly monitoring the price, because unless it only moves up from here going forward (it won’t), the ebbs and flows will always be a factor to keep you up at night.