Bitcoin’s Coming Of Age?

It has been an interesting year for cryptocurrencies. Bitcoin just topped its all-time high this week at almost $20,000 – up 1.6x from last year at this time. The private, all-digital currency still has its skeptics, but it is getting broader acceptance among financial services companies and institutional investors.

The pandemic may be remembered as Bitcoin’s coming of age.

I wondered back in April if Bitcoin would be a ‘safe harbor’ in the pandemic. My own investment thesis on cryptos is that they have potential to be a better store of value than government controlled sovereign currencies.

Related: Bitcoin Amid CV19

In a year where the Fed has expanded the entire money supply (M2) by 20% out of thin air, Bitcoin has (in the short term) supported that thesis.

Additionally, PayPal/Venmo and Square are now offering Bitcoin trading to anyone with an account and they are reporting stronger-than-expected activity in their first month.

Large institutional investors are also piling in. A CitiCorp analyst recently suggested cryptos should be a part of everyone’s portfolio and made the case for their value potentially rising to $300K.

Yes, I still see Bitcoin as a very speculative investment with a lot of risk, but also a lot of potential. I also told you in my last post that I ‘missed’ on Tesla, Amazon, and Facebook. I don’t have a lot ‘bet’ on Bitcoin, but maybe this is the one I’ll be right on?

Are you surprised by Bitcoin’s 2020 run?

Image Credit: Pixabay

5 thoughts on “Bitcoin’s Coming Of Age?

  1. I continue to consider it on a small scale, but it flies in the face of everything I believe in financially. But hey, there are many valid instances of investments beating the norms. I haven’t pulled the trigger to date. Probably still won’t, but it is enticing!

    Liked by 1 person

    1. I think it will be a bumpy ride, but it appeals to my libertarian tendencies. I might profit take right now and reinvest more if a setback comes.

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  2. I am surprised by Bitcoin’s run, but I have also been far too conservative (i.e., wrong) about cryptocurrencies. 170-year old mutual life insurer MassMutual’s announcement yesterday that they were purchasing $100mm of Bitcoin for their general account is likely a data point in support of your thesis!

    Liked by 1 person

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