Bitcoin Investment is Good or bad in 2019?
Bitcoin hit the $400 price in November 2015 something it hadn’t done in a year. Word of bitcoin was reaching the more mainstream financial publications at that time. An article from Bloomberg reported on this price increase in positive terms rarely seen from a leading mainstream commercial publication.
It stated Bitcoin is on a roll. Earlier this week we pointed out that the virtual currency was on a massive winning streak. It's up nearly 40 percent in the last three days.
The Bloomberg article noted that analyst Gil Luria of Wedbush Securities wrote the following to clients earlier in 2014. We believe bitcoin and its associated blockchain technology have the potential to disrupt the existing financial infrastructure over the next few years.
We believe the value of the bitcoin currency (BTC) will benefit from this trend and therefore, are initiating coverage of GBTC with an OUTPERFORM rating and $40 price target.
At the same time in November of 2015, Paul Vigna of The Wall Street Journal wrote in his column. The price of bitcoin is surging, crossing back over the $400 mark for the first time since last November, amid a burst of trading activity and a surge in interest in the technology underlying the cryptocurrency.
Bitcoin reached a high of $768 on June 2016, and GBTC climbed to a top of $135 around the same time. Then bitcoin hit a very volatile period as a recent hack of a bitcoin exchange drove prices down. This is indicative of the asset, which is not for the meek and conservative. But is it even something that an investor should consider?
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Can We Make Money With Bitcoin?
Bitcoin is most commonly referred to as a “digital currency.” It’s not a physical instrument, but just as physical instruments such as dollars and coins can be used, it can function in its digital form as a currency to pay for purchases.
There may not be many retail shops that accept bitcoin, but the list is growing.
It includes Overstock.com, Dell, Microsoft, Reeds Jewelers, and even the Sacramento Kings. You can also use a Visa credit card that can be used to charge purchases that are automatically debited from a consumer’s bitcoin wallet.
What About Bitcoin as an Alternative Investment?
The value of bitcoin can be denominated in dollar value and can fluctuate up or down based on market conditions, it’s not only a form of currency, but it can be viewed as an investment vehicle as well. I used to tell people not to invest in anything if you couldn’t find its price in either a newspaper or through an exchange.
The reality is that bitcoin is traded on exchanges throughout the world on a 24-hour basis. You’ll always know the value of bitcoin in dollars or your local currency.
But before you jump in and buy bitcoin or consider it as an investment, it’s important to recognize that bitcoin or any investment should be part of a financial strategy or plan that's based on your current situation, as well as your goals, objectives and prudent asset allocation strategies.
How Can I Invest in Bitcoin?
The easiest and most direct way to buy bitcoin is through tools like Coinbase or Lawnmower. Coinbase is one of the most established exchanges it’s been well funded by investors such as the NYSE. You can create a wallet there and buy either bitcoin or ether (ethereum).
A lawnmower is a slick new mobile app that allows for recurring buys of bitcoin and even provides analyst-level research and enhanced performance data on not only bitcoin but all the major cryptocurrencies, including ethereum, dash, and ripple. It works in conjunction with Coinbase (your wallet is held at Coinbase), and it also has its own tracking index of the top cryptocurrencies, called the Lawnmower Blockchain Index.
Although increasing numbers of investors are using these accounts and exchanges to buy and sell bitcoin for a profit, the potential for bitcoin as a widely used investment vehicle for the regular investor can be seen in the variety of other investment vehicles that are packaging bitcoin into these investments.
Invest in Blockchain Technology is useful or not?
If you’re skeptical about a direct investment into bitcoin or cryptocurrencies, but you still believe that the efficiencies and potential of blockchain technology the underlying infrastructure of bitcoin can have a major impact on businesses, you may want to consider sticking to investing in the stocks of companies involved in evaluating and integrating blockchain technology into their businesses. There are quite a few, and many of them are a high cap, blue-chip companies.
One of the most visible groups looking at blockchain technology is the R3 Consortium, which began with nine investment banks actively examining how the technology could help their systems and the overall banking infrastructure.
This group included JP Morgan Chase, Goldman Sachs, Credit Suisse, State Street, UBS, Commonwealth Bank of Australia, BBVA, Barclays and Royal Bank of Scotland. It has since grown to over 40 banks, and although they have “closed” membership for banks, they are now looking for non-banking partners.