A few months ago, at the height of Cryptocurrency Mania, I wrote an article about how Bitcoin was changing my life. At the time of writing, Bitcoin had a value around $12,ooo.
The time since then has been a wild ride. Around Christmas, Bitcoin flirted with $20k, hovering between there and $18k for a bit.
Then, it crashed.
It dropped almost as quickly as it skyrocketed, dropping thousands of dollars each week. In the forums and message boards, people tried to keep from panicking. Longtime HODLers tried to reassure newbies that everything would be okay.
It didn’t work. People who bought at $15k or more sold their holdings so the wouldn’t lose any more, lowering demand. Financial giants called it a scam. The Chinese government announced that they would be banning cryptocurrency exchanges (they changed their mind).
At this moment, Bitcoin now has a value of $7,986.04.
Last year’s meteoric rise is a distant memory.
Throughout this time, I have not been immune from anxiety. I’ve watched my holdings dwindle as quickly as they’ve grown, but I’m not ready to throw in the towel. I’ve dug deep into research, trying to learn more about cryptocurrency so I can make an informed decision.
And even though my investment is worth less than half than its peak, I’m not rushing to cash out now. There are a few reasons.
First, it’s about the long-term.
Many people got into crypto for the potential of fast cash. And I admit, that influenced a bit of my decision.
But short-term day trading was never on my mind. And good thing—the day-to-day price swings are enough to give you an ulcer.
No, I’m far more interested in the long-term health. As the dollar loses strength to inflation, Bitcoin has been seeing massive deflation. And while some of that deflation became a bit of a bubble, the trend continues to move upward.
Second, I’m losing faith in banks.
As the world changes, the financial market changes with it. And over the past few years, more and more stories come out that highlight the corruption, insecurity, and dangers of the conventional banking system.
On the other hand, Bitcoin—and other cryptocurrencies—are completely decentralized. Crypto can’t fall prey to the whims of a corrupt banker, because there are no bankers.
And lastly, I still haven’t lost money.
While my holdings were worth far more a few months ago, they’re still worth more than my initial investment. I was lucky enough to get in right before the huge boom toward the end of 2017, so I haven’t lost as much as others.
And I’m not in a spot where I need that money now. I’ve managed to budget my cash flow so that we can afford to have money set aside in different holdings, whether that be a savings account, a Roth IRA, or crypto. But when the day comes that we do need that money, it’s nice to know it’s there.
So I’m not panicking.
Even though I may have missed my chance to quintuple my investment, that wasn’t the point. The point was to have some money set aside in a place where it might grow more efficiently than a regular old savings account.
And so far, it’s done just that.