Hey JessInvestors
Most people who get into Bitcoin use it as a speculative store of value, holding it either as a hedge against inflation or because they think the price will appreciate over time. Speculation is massive in this market, even though it's only a micro-cap in terms of overall market value compared to the world economy.
The issue is with a brand new asset class valuation models don't know how to price in technology, risk, network effects and more. It's all so unique; there is no template like there is for commodities or tech stocks that now have an established track record and set of data.
The truth is no one knows where Bitcoin will go and the last 10-12 years of data cannot tell you what it will do in the next 10-12 years.
What is an asset
Bitcoin is often called an asset, so are stocks and even real estate even when it's not always the case. Buying stocks, Bitcoin or real estate hoping the price goes up to sell later is speculation. Buying stocks, Bitcoin and Real Estate and generating a return in cash flow and then listing to offers to sell this cash flow generating ASSET well that is when it becomes an asset.
When investing in stocks, you should focus on ones that pay dividends; this is an asset. When buying real estate, you should focus on land that can be used to create products or produce, get a rental income, when the land can generate an income, then it is an asset.
So what about Bitcoin?
HODL'ing has its limits
HODL'ing is a great strategy, don't get me wrong I am a massive fan of HOLD'ing and the reward for having prudence, and it has its merits. It provides a floor for Bitcoin, teaches you how to save, rewards your frugality and gives you the capital you can use to generate income in the future.
The vast majority of my BTC goes into HODL'ing as I build a buffer and safety net for myself around the one coin level. The rest I use to build cash flow and use BTC as an asset.
Cash flow is going to make BTC valuable
- I've been leveraging some BTC in CE-FI apps like blockFI and Celsius, providing collateral for loans and getting a return for it.
- I've used BTC to invest in solar panels that pay me a monthly return for anyone who uses that electricity and I get paid in BTC
- You can leverage Bitcoin as a market maker on exchanges and earn payment in the transaction fees.
- Your BTC holdings if early enough would net you Bitcoin Cash, HEX and Bitcoin SV airdrops which you could sell or try other things within the market
- You could use your BTC to set up a lightning node and earn satoshis for validating transactions
While the opportunities to earn with your BTC are not the most attractive, these options weren't around a few years ago. In years to come, there will surely be more ways to use your BTC to earn income.
This is one of the reasons I am bullish on owning this in my personal balance sheet. Just like fiat can net you an income in fixed interest accounts, money market accounts and more. BTC will have the same financial products built on it in the future of that I have no doubt.
Imagine, having your BTC stored safely on a ledger and getting monthly payments for allowing others to put it to work, isn't that the dream?
Producitivy from BTC
The more productive use we have with BTC, the more it appreciates to everyone. Instead of holding it to sell later to create production then, BTC users need to find ways that BTC itself generates more economical use and value that it is accepted for work, services, products and more.
Once we crack this part of the economic puzzle, it will be gangbusters for BTC as anyone who holds it could use it to generate income and leverage their holdings.
Originally posted on The Bitcoin Manual
Have your say
What do you good people of HIVE think?
So have at it my Jessies! If you don't have something to comment, comment "I am a Jessie."
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@tipu curate
Upvoted 👌 (Mana: 7/21)
Thanks so much for the tip
Digital gold and potential next world reserve currency is already a helluva use case imo,
The LN might help develop the retail side but that's not where the future of BTC lies imo, Bitcoin is great at being a neutral settlement layer for large tx, not for buying coffee at the corner cafe
Oh don't get me wrong it's a good use case base we have a shit monetary policy but shitting on BTC isn't going to bring the world out of its funk, just make a few people wealthy, moving it around as fast as possible and getting more products and services out of that moving around and getting users to increase their productivity to get more BTC or encourage holders to part with it, is how we create broad-based abundance,
Store of value is only one element, I'm looking ahead since I already accept its a store of value. The LN is cool, I don't mind it, I think we will eventually see mesh networks where nodes are multi-chain and figure out the easiest path as in taking the LN concept and running it cross chain, people will spend what they want and user will receive what they want and those in the middle of the transaction bouning between nodes and miners get a fee.
It will be a monster behind the scenes hiding all the complexity and for end users its pay and play
Yes that's very well put, nobody wants to live in a world where a handful of people control 50% of the monetary reserve, Bitcoin opens a variety of different futures for humanity but some of them clearly are dystopian.
Would be interested to learn more about this mesh network idea, any content you could point me to?
Exactly, it doesn't have to be a total zero-sum game and it makes time more valuable as well as labour and not this crazy financial trickery we see today. I heard it on a podcast with Andreas Antonopoulos speaking about where he sees the future of the whole space going can't remember which one it was though
I would like to know more about this!
The company is called The Sun Exchange and it's based in my city of cape town, but anyone can invest. they agree a solar build with various schools and businesses and then raise capital from users like us, you can buy "panels" and then the energy from those panels gets converted and paid back to you in BTC for 20 years. It' is however a custodial service but I thought it would be worth a shot
I will study - similar to cloud mining - good guarantees from scam are needed
Yeah I get you the only reason I did it too was because I knew someone who worked there, saw Max Keiser invested in the company so I thought I'd give it a go, not too much BTC though and they pay me every month for going on 8 months now
That's great / what percentage% ROI over 8 months - can you calculate?
I've only made 3% of my principle amount back, but like I said its a 20-year repayment so who knows what it would be like as well as being paid in BTC you have that upside too
Hola chekohler,
Gracias por destinar correctamente el 100% de las recompensas de está publicación a HP y ayudar al crecimiento de tu cuenta.
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STOP.