How Much to Invest in Bitcoin

Is Bitcoin a Good Investment for 2021?
By 
Coin Cloud Team
, published on 
December 7, 2020
How Much to Invest in Bitcoin

When thinking about buying some Bitcoin, the most common question is, “How much should I invest?” And while this seems like a simple question, the answer is a little more complicated. Or, well, let’s say a LOT more complicated (but we’ll try to simplify it for you).

Buying vs Investing

First, let’s talk about what Bitcoin is and isn’t.

Like fiat money, Bitcoin is a:

1. Medium of exchange 2. Store of value

But besides those similarities, there are things that set Bitcoin (and other cryptocurrencies) apart from fiat currency.

Compared to fiat money, Bitcoin is:

1. More volatile 2. Less liquid

All of these factors mean you have a few options with Bitcoin, and buying some isn’t always the same as investing in it. If you want to use it as a medium of exchange, for example — to buy something online, or instantly send money to family overseas — you’re not investing in it. You’re using it.

But if you only care about it as a store of value, and intend to try profiting from it, you’re investing. The question then becomes, how comfortable are you with the volatility and liquidity?

(Hint: Volatility seems bad if you’re risk-adverse, but it’s great if you value reward over risk.)

Your Investment Personality

Once you understand that Bitcoin’s volatility potentially helps make it a good investment — because even though the price goes through short-term swings it tends to move up overall — you still have to analyze your own investment personality. That means where you fit on the risk-reward spectrum.

• Are you willing to risk everything for a possibly huge reward? Then invest more.

• Are you cautious with how much you’ll risk to get anything? Then invest less.

That might seem ridiculously simple, but it’s true. If risking your money means you can’t sleep at night, don’t even bother trying to push the envelope. If it thrills you to no end and you can’t function without the rush, then go for it.

There are people who run from the tiger … and those who try to make it into an exotic rug. Yin and yang. It’s what makes the world go round.

But generally speaking, this isn’t a gun-to-the-head (or gun-to-the-tiger) scenario. It’s a long-term “hodling” scenario. Because traditionally, crypto’s biggest climb has been over time. However, if you’re a tiger-rug kinda guy, you might disagree. And that’s OK.

How Much to Invest

Having said all this, there’s a short answer and a long answer to the question of how much you should invest.

Short answer:

Minimum: $1 (since that’s the minimum you need to purchase at the lowest-minimum platform, which is a Coin Cloud Bitcoin ATM)

Maximum: As much as you can afford to lose (because let’s be honest, you should never, ever invest more than you can afford to lose in anything — there are no guarantees!)

Longer answer:

The truth is, you’re not going to get rich by investing $1 in Bitcoin. It’s a great way to get started — and you can do so at any Coin Cloud BTM — but I’m telling you right now, it won’t make you rich.

Will you get rich investing $50 or $100? No, not rich … but you could, in theory, make a nice profit. Some financial experts expect Bitcoin to 10x, and they said that when it was hovering around $10,000, meaning it could be worth $100k in the future. Or not. But it could.

Now it’s almost double that value, so let’s say it could 5x. That means if you invested $50 or $100 today, you could make a few hundred profit over time. Or not. Depending how you played it.

If we apply some math to that possibility, investing $1,000 now could net you several thousand dollars, and so on. As always, the amount you’re willing (and able) to risk will dictate how much you could possibly profit … or equally possibly, lose.

So now you see why this isn’t an easy question to answer … but at the same time, it’s exciting to think about!

Disclaimer: The information and views supplied on the Coin Cloud blog are for educational and entertainment purposes only. We are not financial advisors, so please do your research and consult with a trusted financial specialist before investing your money.

What is Coin Cloud?

Founded in 2014 in Las Vegas, Nevada, Coin Cloud is the leading digital currency machine (DCM) operator. With over 4,500 locations nationwide, in 48 states and Brazil, Coin Cloud operates the world’s largest and fastest-growing network of 100% two-way DCMs, a more advanced version of the Bitcoin ATM. Every Coin Cloud DCM empowers you to quickly and easily buy and sell over 40 cryptocurrency options with cash.

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