If you are planning to invest in cryptocurrencies today, it is always a good idea that you know exactly what you are getting into. Volatility is a concern for many investors. In fact, those who bought their Bitcoin before 2017 were lucky enough to experience a bull-run that made the cryptocurrency reach its all-time high last year at near$20,000. To put things into perspective, Bitcoin started at around $1,000 in 2017. But if you entered the market a bit late, can you still get rich from Bitcoin and other cryptocurrencies? Should you believe that Bitcoin is to surpass its all-time high this year?
Bitcoin Advocate Charlie Shrem believes that it is pertinent for a crypto investor to not get spooked by the volatility of the cryptocurrencies. Instead, it is a good idea to select a token near the top end of the current crypto market and treat it as a long-term investment.
Shrem was speaking to Yahoo Finance at the MoneyShow Conference in San Francisco when he mentioned that: “You’re putting your wealth in these things, and they break. Things happen. The values go down 90%, then the values go up 100%. I always tell people if they want to get into crypto, ‘How much money, if you lost it right now, would you be OK with?’ ‘$500,’ they tell me. So invest $500 in a basket of crypto, and then just have fun with it. Just enjoy it, learn. There’s a lot of good ones: bitcoin, Ethereum, Dash, Litecoin. Just learn what makes them different”.
How much time do you need to wait for the cryptocurrencies to give you a sizeable profit? According to Shrem, you have to hold the cryptocurrency for at least five years. There is a high probability that one of these cryptocurrencies that you invested in will give you a profit. He mentioned that bull and bear markets usually happen in two-year cycles.
From Prison to Founder of BitInstant
In 2016, Shrem served his time for two years following his conviction for conspiring to sell bitcoin to users in Silk Road, a deep web marketplace used for illegal activities. When Shrem was arrested, he became the founder of BitInstant which is a cryptocurrency exchange that once had the chance to process 30% of all bitcoins in circulation.
He was also able to start Crypto.IQ which is a startup that aims to offer educational resources such as daily newsletters and alerts to cryptocurrency traders.
Things Have Changed
Shrem thinks that a lot has changed since BitInstant has been defunct. However, he doesn’t think that the number of cryptocurrencies today as a bad thing for the market. He mentioned that: “These 1600 coins are doing the guerrilla marketing. They’re doing that on-the-pavement work that crypto used to do in the early days. It’s getting people in — it’s getting people intrigued…Bitcoin will always be that ‘daddy’, that long term gold that everyone has a huge amount in. You will see overtime that the transaction volume of bitcoin will go down because people are going to see it more as a store of value knowing that if that one fails, they all fail. But it’s definitely fun to have other projects like Steem to experiment with and see what they’re all about”.
And also, he thinks that a Bitcoin ETF is finally going to happen in 2019. However, he believes that if something happens once there is a Bitcoin ETF, then the market may not have another Bitcoin ETF again.