On this week’s episode, Doctor Bitcoin reviews some of the most commonly asked questions about cryptocurrency and encourages potential buyers to reframe those questions in ways that are more meaningful.
Are we in a bubble?
Instead, what you’re thinking (and what you should be asking) is “Bitcoin’s price rose very quickly. Is this a problem? Is this normal?” CME Group’s Chairman Emeritus Leo Melamed said that Bitcoin is the “first new asset class in over 100 years.” The FTC doesn’t even have a proper classification for cryptocurrency yet, so any speculation of a “bubble” is just that: speculation. However, Bitcoin may follow the same curve as other user adoption platforms, such as Airbnb and Uber, and therefore the success of the currency would be based on its usage.
When’s the best time to buy?
What you’re really asking is “When is the best time to put money into this volatile market and mitigate my risk?” 2009 was undoubtedly the best time to buy. But the second-best time is now. Given a long enough timeline, the value tends to increase. Converting your dollars into cryptocurrency, over the long term, is a tried-and-true method for investing without the volatility of day trading.
When’s the best time to sell?
Doctor Bitcoin doesn’t frame this question in these terms at all. If you are in a cryptocurrency-first lifestyle, you aren’t thinking of cryptocurrency as a buy/sell system but rather as a superior way to use and spend money. Instead of thinking about how much the currency is worth, it may be beneficial to think about your purchasing power.
Have you heard of (new ICO or Coin)?
The answer is “Probably not,” but that’s not the important part. What you’re really wanting to know is how to research and evaluate the validity of new ICOs and coins for yourself. We suggest evaluating the team, the product market fit, the competition, and the economics of the offering to see if these match your specific goals.
Should I buy (new ICO or Coin)?
Instead of asking us, look at your research, goals, and the amount you have to invest before coming to your conclusion.
The key is to educate yourself and learn everything you can about cryptocurrency and the projects that interest you, so you will be better prepared to avoid potential pitfalls and take advantage of future opportunities.
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