Should You Buy Bitcoin?

Bitcoin is breaking the mainstream with a reason bystanders can't resist: price.

After years of being an eccentric topic among a quirky minority, Bitcoin is breaking the mainstream with a reason no regular person can ignore: price.

At the time of writing this, Bitcoin is now being priced at over 2400 USD, hitting unanimous all-time highs across all exchanges. Record breaking prices have been a regular occurrence on a nearly daily basis for weeks now, striking up the attention of the masses who suddenly remember the term "Bitcoin" being uttered by a friend a while back.

As I check my phone every morning, it seems that a lot of people consider that friend to be me.

Why Are Prices Surging So High?

Bitcoin Prices

A number of weeks have passed with nothing but good news:

  • 80%+ SegWit support: The Bitcoin community has been split in a destructive debate regarding the future of underlying architecture for months. At its worst, the toxicity has threatened to hardfork the currency, which would create two versions of bitcoin for every holder. Solutions to avoid this disaster scenario have entered the picture, increasing confidence for the future.
  • Japan recognizes BTC as a legitimate currency: As many nations resist or attempt to ban cryptocurrency altogether, their attempts become more futile over time. Nations regulating and accepting Bitcoin as a legitimate currency signals recognition that a "war on bitcoin" would probably be as successful as, say, a war on drugs.
  • Bitcoin ransoms: Companies have come under attack as a result of security exploits made public by WikiLeaks. Hackers have held company data hostage, while accepting ransom in the form of Bitcoin. As a result, firms are buying BTC as an insurance policy on their data.
  • All of the above: Good news hits hard, but a storm of good news combined with no bad news is greater than the sum of its parts. Surges in price have a snowball effect as we all buy in, for now.

Where Are We Heading?

Bitcoin Rollercoaster Guy

Before even considering action, let's consider the two extremes of what crypto could mean for the world:

  • Worst case: Themes which have become synonymous with cryptocurrency are typically darkweb trading, money laundering, and hacker payments. While these seem like evil things, they guarantee that these currencies will always have some sort of value in the modern world. Considering we're taking bets here, it seems logical that Bitcoin's purpose is, at worst, better than gold.
  • Best case: It's possible that we're still living in a pre-bitcoin world. That could mean anything from Bitcoin being a regulated asset, stepping in as the currency of failed states, or an extreme replacement of fiat currency in some form. One can only imagine what the price of a single Bitcoin would be if anything close to a majority of the world has a reason to hold Bitcoin.

What Should I Do?

Asking this question is a reflection of what the the world is doing now. The upward trend has remained consistently aggressive for a relatively unusual length of time. As this continues, it's easy to make a case that this could be the biggest Bitcoin bubble yet. Even then, if Bitcoin were to crash tomorrow, time has shown resilience in the wake of disasters. Remember that we are now over twice the value of Bitcoin at the time of the Mt Gox crash.

Many Bitcoin circles routinely allude to Bitcoin hitting a value of 10k in a matter of years or sooner. Even if this is prophecy, the path to growth may not be a pretty one. The only individuals I would advise to buy in to Bitcoin are the ones who truly believe in the philosophy and purpose of digital currency, and are willing to bet that the world will change enough in the coming years to justify an exponential increase in value.

I only care about money, why should I care about the "philosophy" of Bitcoin?

Now more than ever, buying in to Bitcoin means buying the idea that the world's ecosystem is flawed. If you believe that banks can be too big to fail, or that a centralized elite is needed to keep the world in order, you already don't believe this investment is viable.

As nations commit financial suicide in attempt to overthrow long-held establishments, Bitcoin is the rational alternative revolution taking place simultaneously. Decentralized currency is a rejection of failures such as the housing crisis, or that an entire nation's money should be printed by a private entity dubbing itself the Federal Reserve.

Consider the fact that nobody will be there to take blame if you buy in now and witness a crash. I have personally been trading Bitcoin for about 5 years now, and there are plenty more who had been trading sooner. Nobody will feel sorry for the revelation you have today that Bitcoin's core community had half a decade ago.

Also feel free to consider the idea of cheering on the closest thing to a new world order we may experience in our lifetimes. Imagine the notion that the neglected castaways were right all along. Imagine the journey of watching once-invincible nations and institutions struggle and fail to stop the success of power to the people. Consider this somewhat sadistic vision to be a prerequisite for buying in now.

If you're looking for a decisive 'buy' or 'don't buy' directive, I'm afraid this is where I'll disappoint you. You have the knowledge to weigh this risk on your own.

All that I ask is that you don't just go buy a commodity. If you want become a part of this now, you'd better commit to a team.

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Todd Birchard

Todd Birchard

Application Architect

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