The Six Truths: Why Bitcoin Is Still Cheap!

When I started out with Bitcoin, I remember saying that Bitcoin was way too expensive at that time. Nowadays, I am happy not to have waited for another month or longer. These are my articles on the different aspects for the value of a digital currency and five reasons for the value of Bitcoin. People still approach me and I tell me that “Bitcoin is too expensive now”. This is simply wrong and I will tell you why.

Value Of A Currency

The value of a currency is defined by multiple factors. The three most important ones are:

  • Belief
  • Acceptance
  • Amount

We need the belief and the acceptance, as otherwise no one wants the currency, and it is sold by everyone. Only the currency can be used, it differs from objects like gold. And somehow the value is always falling, since we know the ECB and FED are just doing what they want. But, the amount is tremendously important to the value. If there is just too much currency out there, it is worth a piece of cake. Though, if there is a spare amount out there, the value has potential to sky rocket.

Truth one: The amount highly influences the value. And Bitcoin is finally limited.

People sitting like an auditorium and listening

Investor Perspective

In case you invest in Bitcoin in order to profit from mid or long term value increase, why do you care about short term volatility? People want to kick their own asses when they tell me they bought Bitcoin at 5.000$ and the price is now “already” down to 4.800$. Even if the price falls to 4.000$ it should not be of interest for an investor. Mid or long term, most people agree that the price will crush the 10.000$. And that price is expected within a year. With such an raise of value and return on investment you should not make yourself crazy about the volatility.

Truth two: All investors do not care about short term volatility.

Gaining Attention

Bitcoin is receiving more and more attention. For me, the hype started at the mid of this year. Whenever we date it now, I would say the interest is still raising. I meet hundreds of people who want to learn more about the topic. And the interest on putting a small amount down just to join this hype and get more insight is extremely high. Thus, more people want to buy Bitcoin. And this includes both big fish, who put 100.000$ down as well as smaller deposits about 100$.

Truth three: More people want to buy Bitcoin every day.

On the one hand side, the demand for Bitcoin is growing every day. On the other hand side, only 12.5 Bitcoin are created every 10 minutes. So, the question you should ask yourself: Will 12.5 Bitcoin in 10 minutes suffice the growing demand in 10 minutes. Regard, people like me are also reinvesting. So, the 12.5 Bitcoin must not only cover newcomers, but also the demand of existing investors for stacking up. I think that at the moment, it is OK, but every single minute passing, the chance of this becoming a bottleneck is higher. Especially, when I think that this includes the whole world.

Truth four: The raising amount of Bitcoin is not satisfying the demand for Bitcoin.

Small green plant on grey sandHope For Investments

There is a fundamental truth a broker friend of mine told me: “The market is never lying”. The price which is currently out there, is simply the price. There is no too expensive or too cheap. It is simple economics which determine the price world wide: Demand and supply. Whenever you say that the price is too high, you actually say that the market is lying to you. Do you still believe that?

Truth five: The market is never lying.

Usually, the origin for the belief that the value is too high is hope. It is hope, that the price will fall down. It is hope, that you can do a bigger profit. It is hope, that you are just not too late to the party. Hope will make you blind and will result in bad investments – or none at all. Try to gain an objective overview and put away subjective opinions. What do you now think about the price?

Truth six: Hope is a bad advisor.

Do you still think the Bitcoin price is too high? Do you have other reasons which explains why the Bitcoin price is too high? If so, let me know. Otherwise, I can help you to get started in Bitcoin now!

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