In this essay, the author explains why they believe bitcoin is the best way to preserve their net worth and why they allocate a portion of their income to it as a reliable store of wealth and inflation hedge.
The original cryptocurrency, bitcoin, is being utilized more frequently as a trustworthy store of wealth by people trying to diversify away from more traditional asset classes because it is proving to be a reliable inflation hedge. In this essay I’ll explain why I think bitcoin is the best way to maintain the value of my net worth and why I allocate a portion of my income to it.
Why Give Bitcoin A Share Of Your Wealth?
Despite its volatility and fear-mongering, bitcoin is a legitimate market competitor. No professional investor would recommend investing your life savings in cryptocurrencies, but there is still a lot of upside potential for those willing to do so to preserve some money or make long-term profits.
Let me just highlight a couple of these benefits that make this bitcoin investment worthwhile researching further:
- Bitcoin is the best third-party-free store of value. It eliminates banking institution fees and red tape because it is decentralized. It is not subject to inflationary pressures like enterprises utilizing government-controlled fiat currency.
- Long-term growth: Bitcoin’s price fluctuates drastically, but its long-term trend has been favorable. You can only appreciate your investment’s true value if you ignore the surges and hold on for dear life. HODLing applies here.
- Diversification: Bitcoin doesn’t require you to put all your money in volatile cryptocurrencies, but it can diversify your portfolio over time. Bitcoin prices are becoming increasingly uncorrelated with those of traditional assets like equities and bonds, so adding some of these digital coins to your portfolio can help diversify old guard risks. Bitcoin has become a semi-safe haven asset class for investors in times of financial stress.
- Accessibility: Two lanes. Platforms and exchanges make buying and holding bitcoin easier. Selling bitcoin for fiat money is easier than ever. This beats the stock, bond, and real estate markets, which usually have liquidity issues, especially amid financial instability.
Spending a portion of your money on BTC won’t likely cause you to go hungry in the long run. On the other hand, not investing in Bitcoin could damage your fortune, especially in these unsettling times when banks can fail suddenly, inflation seems to be increasing at an alarming rate, and numerous nations are witnessing their fiat currencies depreciate to the level of toilet paper.
Why I Don’t Mine Or Buy Bitcoin
There are always the apparent ways to get bitcoin, such as going to a cryptocurrency exchange or peer-to-peer marketplace and just swapping money for BTC. This method is perfectly acceptable, and for many individuals it may even be their only choice. However, in my honest view, it is not the ideal way to obtain coins for wealth preservation.
Instead, you could choose to follow the path of the miner and spend a sizable sum of money on purchasing all the necessary equipment in an effort to try and earn some BTC that way. However, given that the average mining cost for a coin in many countries is currently over $30,000, it is more likely that you will end up with nothing before you ever mine your first coin.
So what do I recommend? Gain it.
Although not everyone can persuade their employer to pay them in bitcoin, many people these days have a side business that they may simply use to make some extra cash online. Giving customers the option to pay for your services with cryptocurrency was unheard of five years ago, but it is now obvious. Many of my clients are currently very interested in using cryptocurrency to pay for services, especially those who work online. Although the majority of them choose to use stablecoins like USDT, you can quickly convert them to BTC and keep adding money to your Bitcoin wallet.
Another prominent online activity I engage in to accumulate some BTC is restricted to those who are at least 18 years old. I don’t mean OnlyFans, though. I occasionally enjoy a little gambling myself and work in and around the gambling industry, but I only bet for Bitcoin.
Due to their capacity to safeguard anonymity, provide promotions (such as bonuses, commissions, etc.), and generally outperform the irksome bureaucracy ingrained in fiat betting sites, bitcoin betting sites have recently gained popularity. Obviously, I don’t advise everyone to gamble, but I do enjoy it occasionally, especially when my favorite UFC fighter enters the ring. It adds a little excitement to the fights, and obviously, any gains go into my BTC fund for wealth preservation.
My Plan to Preserve My Bitcoin Wealth
Why do I only care about bitcoin? I don’t diversify my crypto assets because most top tokens follow bitcoin like a donkey following a carrot. I like several cryptocurrencies, but since bitcoin drives the value of many of the top dogs, I’ll remain with BTC as my investment coin. (Avoid meme and shitcoins if you want to start other cryptocurrency initiatives.)
Let’s get right to it now. Based on my own method, I provide the following guidance for using bitcoin to preserve wealth:
- Plan ahead: Have a goal when investing with fiat money from a day job or bitcoin from your own ventures. Work hard to attain your annual or quarterly goals.
- Don’t panic—buy more Bitcoin and hold it forever. Don’t sell because of bitcoin’s dramatic price volatility or fiat money value. Compare exchanges and cryptocurrencies, but ignore Bitcoin’s price. Even though there will be short-term falls, bitcoin is safe. Bitcoins are limited to 21 million. As more governments and individuals adopt this new financial paradigm, the value of this asset will rise due to its finite supply and over eight billion people on Earth, with more being born daily. If money declines and bitcoin becomes the global currency, the average BTC per person will be 0.0025. You want to be in the top 5% of holders.
- Keep it safe: Because bitcoin is digital, thieves are always looking for unguarded money. To protect my riches, I keep my bitcoin in hardware wallets in a secure area. Keep your wealth cold and offline, even though there are many trustworthy exchanges and hot wallets.
Why You Should Diversify Right Away
As the expression goes, “the best time to start is yesterday, the second best time is now.” Investing a portion of your capital in bitcoin can be a good method to preserve and even increase it.
Don’t wait till BTC reaches $50,000 before you start investing all of a sudden. Create a strategy now and begin diversifying your portfolio in this future-proof asset class so you can rest assured that your money is secure, regardless of how horrible your government may be.