Is Bitcoin the Best Gift You can Get this Christmas 2020?

Is Bitcoin the Best Gift You can Get this Christmas 2020?

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by Matthew Tansley — 8 months ago in Blockchain Technology 7 min. read
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With PayPal recently allowing customers to use Bitcoin and other cryptos for their day to day transactions, more people have started to look at crypto in a more positive light.

And, like a surprise holiday present, this announcement also pushed Bitcoin’s price to soar almost overnight… making it an exciting time to get into the industry.

If you’re new to trading and are interested in riding this windfall, keep in mind that crypto price increases of more than 100% in a matter of hours are ‘par for the course’ if you watch the market for long enough. There’s a huge potential for making money.

But with great volatility comes great risk! You need to understand the fundamentals of trading and basic risk management to ensure you are always in control of the possible outcomes of your investments.

Why Cryptocurrency is like a Gift that just Keeps on Giving

Imagine you had a big, red Christmas sock that fills up with goodies every so often. That’s sort of like what cryptocurrency is.

You might own a coin that’s worth less than a dollar today… but could be worth hundreds tomorrow.

That’s why crypto is a major game-changer in an otherwise stagnant financial sector. Plus, it gets around common headaches associated with fiat currency.

Efficient and Cost-Effective

The decentralized structure of cryptocurrency offers many benefits such as improved privacy and security, affordable cross-border payments, wider access to financial services, etc.

This plays in contrast to traditional institutions that require full transparency and control of how money circulates in the economy. With banks, for example, international transactions are padded with excess fees.

Not to mention that it can take days before it reaches the recipient because the transaction has to be checked and verified by various branches before it can push through.

With cryptocurrency, however, intermediaries are not required which means money transfers happen very quickly and with little to no fees regardless of where you’re sending the funds to.

Essentially, it’s like a bargain bin gift that your distant aunt just sent you… then you found out that it’s actually worth a lot.

Its Value isn’t Affected by Domestic Inflation – Supply is limited

The biggest problem with fiat is that governments are free to print local currency for different reasons, such as stimulating the economy, coping with calamities such as the 2020 global pandemic, or riding out unexpected economic threats.

These will end up reducing the currencies’ value in the long term. The worst case is that it can potentially result in hyperinflation as a result of overprinting.

Cryptocurrencies, like Bitcoin, cannot be printed by a single entity meaning its value won’t go down due to overprinting and many other coins retain their value depending on usability, transferability, and demand.

In fact, Bitcoin is often referred to as ‘digital gold’ given the fact that its supply (new Bitcoins being ‘mined’) is programmed to become harder to obtain each ‘halving event’.

Please note that not all cryptocurrencies are the same so do your own research.

Ripple, for example, has a huge amount of its coins held in Escrow which is released on a schedule. This has been blamed for suppressing the price for a long time.

Please note that not all cryptocurrencies are the same so do your own research.

Ripple, for example, has a huge amount of its coins held in Escrow which is released on a schedule. This has been blamed for suppressing the price for a long time.

6 Reasons Why Crypto is One of the Best Gifts you can have this Holiday Season

1. Huge Gains so far in 2020!

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Volatility is often painted by the mainstream media as a cause of concern for most investors. But the truth is, more volatility means more opportunities to make some money.

A crypto investor with a good grasp of the market can start investing a relatively small amount of capital then triple that amount in a few months, especially if they can regularly trade rather than just invest!

One recent example is Bitcoin’s rapid recovery!

In March 2020, Bitcoin dropped from $10,000 to below $4,000, the lowest it’s been in years. This was due to a culmination of factors like the oil price war, the pandemic, and people’s fears prompting them to sell-off.

But, those who saw this opportunity and bought into Bitcoin at that time are now swimming in profits since its price fully recovered in just a few months!

This signs that 2020 is offering up a bullish market, which is generally much more forgiving for newcomers.

2. Bitcoin’s Price is Recovering! Those Who Held on are Winning!

Holding is a strategy where you simply keep hold of your assets until they reach a certain price point where you are happy to sell.

This does require a lot of patience, emotional discipline, and overall belief. Unless you get an amazing buy-in price, it is likely that at some point you will find at least part of your portfolio ‘underwater’.

That’s where your emotional discipline and belief have to step in:

Emotions: “Oh **** Bitcoin crashed to $5000 since I bought at $10,000. What if it goes to ZERO? Maybe I should just get out now and take what I can!”

Logic: “Bitcoin is down, fair enough, my plan was to buy Bitcoin and add more if the price drops so this is a good thing. I believe that at some point in the future Bitcoin will be above $10,000 so, seems like Christmas came early this year! Let’s get some discounts now!”

3. 2020 is still ‘early’ to Get into Bitcoin

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Bitcoin is one of the most valuable cryptocurrencies in the world. Many of the available crypto-related services are centered around this asset.

One of the reasons why Bitcoin is so popular is because there will only ever be 21 million Bitcoins in circulation. Once that last coin is mined, many experts predict that its price will more than double the current value then grow exponentially.

The last coin won’t be mined for another 100 years though…so keep in mind that if the world falls out of love with Bitcoin between now and then, the argument for huge price increases due to limited supply will be void.

If I’m down to my last few pairs of sweaty socks, they would only be worth a fortune if enough people out there were demanding them after all.

4. Governments Can’t Take Control of Your Money

Governments have more control over your fiat money than you might think.

Take Egypt for example, their government told the banks to limit the number of withdrawals and deposits that anyone can make. The reason?

Well, according to Tarek Amer, Egypt’s central bank governor, they just want some discipline because it seems that people are withdrawing cash without having any urgent needs.

This is one of the biggest problems with fiat. Governments and banks can limit or even freeze your accounts which will leave you penniless.

You might think asset freezing would only affect mafia bosses, drug lords, and the like, but it’s not that unusual to see bank accounts and cards frozen, for example, when a spouse passes away.

Cryptocurrency, on the other hand, isn’t controlled by any single entity. So you have the assurance that your finances are yours to keep.

Plus, having some cryptocurrency on hand means you will always have access to your money.

Many top investment firms now also recommend exposing at least a portion of your portfolio to major cryptocurrencies so that you have control and a ‘hedge bet’ against the more traditional markets facing a collapse.
Also read: Top 11 Cool Websites everyone Should Know

5. A Potential Alternative to Fiat in the Future

Cryptocurrencies haven’t stopped growing in popularity and even established entities acknowledge its value.

In May 2020, it was reported that huge brands such as Amazon, JP Morgan, and Microsoft are buying cryptocurrencies.

This suggests that investor confidence is still rising, making this one of the best times to start investing in crypto.

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6. You Don’t Need Millions in Capital to Make Good Money

The pandemic hasn’t stopped crypto’s momentum. And in fact, more and more people are accepting cryptocurrency as a whole.

Countries like Nigeria, Canada, Spain, the U.K., and Greece all saw impressive growth in the number of people showing interest in crypto.

One of the reasons is that cryptocurrency does give you the opportunity to grow your money in a very short amount of time.

As mentioned earlier, cryptocurrency prices can change within a very short period making it possible for your $1000 to grow by up to 300% in a year. Ignoring compounding, that’s 25% a month!

Again, you must use proper risk management if you are investing in cryptocurrency to avoid a shock.

On the other hand, stocks only grow by 7-10% per annum. That’s roughly 0.6%-0.8% per month.

The worst part is, with stocks and bonds, some fees can go as high as 5% per transaction. Plus, once you decide to withdraw your money, the government takes a portion of your profits as tax.

Depending on the local regulations, it can reach as high as 15%!

With cryptocurrency, you may not have to pay any taxes at all, and transaction fees are generally lower which means you can maximize your earnings potential.

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Also read: The Top 10 In-Demand Tech Skills you need to have in 2021

Get yourself one of the best gifts this season

If nothing else, 2020 so far has shown us that you need to be prepared for anything.

Cryptocurrency should have earned a place on your financial toolbelt alongside the usual bank accounts, cash savings, stocks, etc.

Right now, the crypto market offers some of the most promising opportunities that investors can look into and it is certainly an asset that will continue to evolve and become more profitable as time goes on as long as the buyer picks and chooses wisely.

Based on current trends, cryptocurrency is a gift that, over time, just keeps on giving.

Matthew Tansley

Matthew is the Founder of ProfitFarmers and Propillo. Finance, Trading and Cryptocurrency are his languages of choice but what drives him to keep ‘talking’ is his passion for helping others.

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