Bitcoin

Bitcoin may still be the best long-term investment if you want to retire a millionaire

Published

8 months ago

2 June, 2024

Bitcoin may still be the best long-term investment if you want to retire a millionaire

O S&P 500 (SNPINDEX: ^GSPC) is making new highs at the same time as Bitcoin (CRYPTO:BTC) is hitting new all-time highs, and this is leading to an interesting dilemma for investors. Should they invest in the S&P 500 or Bitcoin?

The answer may surprise you. Yes, Bitcoin is extraordinarily volatile. And yes, the crypto market has historically been a very risky place to invest. But there’s a good reason why institutional investors are betting on Bitcoin these days: It’s impossible to ignore Bitcoin’s superior long-term returns.

Bitcoin versus S&P 500

The idea that Bitcoin might be a better long-term investment than S&P 500 It may be controversial, but consider the evidence. Cathie Wood of Ark Invest recently crunched the numbers and the results are jaw-dropping, to say the least.

Wood compared Bitcoin’s price performance to that of six other major asset classes (gold, commodities, real estate, bonds, stocks and emerging markets) over different time horizons going back seven years. To track stock performance, she used stock performance. SPDR S&P 500 ETF Fund (NYSEMKT: SPY).

To say that Bitcoin has outperformed these other asset classes over the past seven years would be an understatement. During this seven-year period, Bitcoin’s annualized returns were an impressive 44%. Other major asset classes averaged a return of just 5.7%. In fact, it didn’t matter if you looked at a seven-year, six-year, five-year, four-year, or three-year time horizon. The results were always the same: Bitcoin dominated all other major asset classes.

And, if you ignore the down year of 2022, when the price of Bitcoin collapsed, the results would arguably be even more impressive. In the period between 2011 and 2021, Bitcoin was the best performing asset in the world, and it wasn’t even close. Bitcoin delivered 230% annualized returns, while the S&P delivered 14% annualized returns.

How much Bitcoin should you have in your portfolio?

Using Modern Portfolio Theory, which takes into account factors such as correlations between asset classes, it is possible to calculate how much Bitcoin should be in your portfolio. As you may have already guessed, this percentage has been steadily increasing over time.

Wood found that Bitcoin’s optimal allocation has increased from 1% in 2017 to just under 5% in 2021. And given Bitcoin’s heroic performance in 2023 (when its value soared by more than 150%), the optimal allocation under this theory has now increased. to a whopping 19.4%!

The story continues

A person holding an orange flag on top of a pile of money.

Image source: Getty Images.

Although I am extremely bullish on Bitcoin, I would never advise anyone to invest almost 20% of their portfolio in such a risky and volatile asset. After all, as even Wood acknowledges, there have been at least four major crashes in Bitcoin’s history, when its price fell by 77% or more.

Let me put this another way. Over the nearly 15-year history of Bitcoin, there have been four nightmarish periods where you could lose a large portion of your wealth if you had a large portion in Bitcoin. In a typical Bitcoin collapse, you can lose almost everything in a very short period of time.

This is scary, but it also points to Bitcoin’s resilience. After each major bloodbath, Bitcoin came back even stronger, setting new all-time highs. But you have to be patient. You need to have a long enough holding period to ensure you can capture all of Bitcoin’s upside while recovering from any particularly nasty dips.

Does slow and steady still win the race?

Obviously, comparing Bitcoin’s performance to that of the S&P 500 will be controversial. But you can’t ignore the evidence. No matter how impressive the S&P 500 performs over a given period of time, Bitcoin is almost certain to outperform it.

So, if you really want to become a millionaire, you might consider adding a slice of Bitcoin to your portfolio. Think of it as the magic rocket fuel that can take your portfolio to new heights. Just make sure you’re buckled up and ready for some periods of extreme turbulence.

Should you invest $1,000 in Bitcoin right now?

Before buying Bitcoin shares, consider the following:

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Consider when Nvidia I made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you would have $671,728!*

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Dominic Basulto has positions in Bitcoin. The Motley Fool has positions and recommends Bitcoin. The Motley Fool has a disclosure policy.

Forget the S&P 500: Bitcoin Could Still Be the Best Long-Term Investment If You Want to Retire a Millionaire was originally published by The Motley Fool

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Related Topics:asset classes Bitcoin S&P 500

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Forget the S&P 500: Bitcoin Could Still Be the Best Long-Term Investment If You Want to Retire a Millionaire

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Bitcoin

What to watch for in the markets

Published

6 months ago

21 July, 2024

SatoshiTimes Staff

Photo: Andrew Harnik (Getty Images)

After witnessing one of the largest global IT outages on record, affecting the travel, finance and healthcare sectors worldwideThis week is set to see more political drama, events, and earnings reports from tech giants.

Donald Trump’s ‘Lovefest’ Sets Jamie Dimon Up for Consideration for Treasury Secretary Job

Let’s take a look at what awaits us:

Major companies will release their earnings reports

Major tech companies and others will release their earnings reports this week, paving the way for what the second half of 2024 will look like.

Monday

Verizon will report earnings before the start of operations.

Tuesday

Coca-Cola, Comcast and UPS are all set to report earnings before the market opens.
Tesla will report earnings in the morning, while General Motors will report earnings in the evening.
Alphabet and Visa will report results after the market closes.

Wednesday

AT&T will release its report before the market opens.
Ford and Chipotle will report earnings after the market closes.

Thursday

Earnings reports from AstraZeneca, American Airlines and Southwest Airlines will be released before the market opens.

Trump to speak at Bitcoin conference

Presumptive Republican presidential nominee Donald Trump will speak at the next Bitcoin Conference in Nashville, Tennesseewhich is scheduled for July 25-27. While this is the first time a presidential candidate will attend the conference, it has sparked a debate over whether the crypto-friendly Trump will receive support from the crypto community in the upcoming election.

In addition to Trump, independent presidential candidate Robert F. Kennedy Jr. will also discuss crypto during the conference. Crypto advocates such as ARK Investment’s Cathie Wood, MicroStrategy’s Michael Saylor, and whistleblower Edward Snowden are among some prominent names who will be participating in the conference.

Ether ETFs are on the way

New Ether Spot ETFs are set to begin trading on Tuesday, July 23. Much like the spot Bitcoin ETFs, these ETFs will allow investors to buy the second most popular cryptocurrency like stocks. BlackRock, Ark Invest/21Shares, VanEck, Grayscale, Fidelity, Bitwise, Franklin Templeton, and Invesco/Galaxy Digital are all set to offer Ether ETFs. Crypto asset manager Bitwise predict that trading in the Ether ETF will drive the price of Ether higher, potentially surpassing $5,000.

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Bitcoin

Cryptocurrency’s Biggest Winners and Losers in a Second Trump Presidency

Published

6 months ago

21 July, 2024

SatoshiTimes Staff

Cryptocurrency’s Biggest Winners and Losers in a Second Trump Presidency

Bitcoin miners and cryptocurrency companies that have been blocked from going public in the U.S. could ultimately be the biggest winners in the digital asset world under a second Donald Trump presidency. Foreign companies at risk of losing market share could end up being the biggest losers.

That’s the view that’s taking hold among market participants and observers in the wake of the former president’s growing embrace of cryptocurrency as his chances of election grow. survey released Thursday by CBS News showed Trump with the majority — 52 percent — of likely voters in his likely November rematch with President Joe Biden.

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Bitcoin

Bitcoin, Ethereum, Solana and Cryptocurrency Markets Look Ready to ‘Send’ as Stars Align, According to Investor Chris Burniske

Published

6 months ago

21 July, 2024

SatoshiTimes Staff

Bitcoin, Ethereum, Solana and Cryptocurrency Markets Look Ready to ‘Send’ as Stars Align, According to Investor Chris Burniske

Cryptocurrency investor Chris Burniske says Bitcoin (BTC), Ethereum (ETH), Solana (SUN) and the cryptocurrency market in general seem poised for a run.

Former Head of Cryptocurrency at ARK Invest account his 292,200 followers on social media platform X that several catalysts are aligning, suggesting that digital asset markets are on the verge of a bull run.

According to Burniske, a partner at venture capital firm Placeholder, the highly anticipated launch of Ethereum-based exchange-traded funds (ETFs), Republican presidential candidate Donald Trump speaking at an upcoming Bitcoin event, and the current state of the BTC, ETH, and SOL charts all suggest significant optimism for the cryptocurrency markets.

“With ETH ETFs set to go live, Trump speaking at The Bitcoin Conference, and BTC, ETH, and SOL charts looking [they do] (while stocks are weak), it’s hard to imagine a world where we don’t ship next week.”

Reuters recently reported that preliminary approval for ETH ETFs has been granted as the Bitcoin Conference is scheduled to take place from July 25-27.

BTC, ETH, and SOL are trading at $67,333, $3,528, and $174 at the time of writing, respectively.

The venture capitalist too provides an update on his prediction that the total crypto market cap will eventually hit $10 trillion. According to his chart, the path to $10 trillion is currently “23%” complete, as it sits around $2.2 trillion.

Source: Chris BurniskeX

Earlier this month, Burniske he said in an interview with Real Vision CEO Raoul Paul that he has his eye on the Move ecosystem, which was originally built by social media giant Meta and then used to develop layer 1 blockchains Sui (IUE) and Apts (APT).

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Bitcoin

Here’s the next target for BTC before bulls can hold out for $70K

Published

6 months ago

21 July, 2024

SatoshiTimes Staff

Here’s the next target for BTC before bulls can hold out for $70K

Bitcoin’s recovery is going well, and the market is seemingly poised to create a new all-time high in the near term.

Technical analysis

Per NegotiationRage

The daily chart

As the daily chart shows, the price of Bitcoin has been rising since it broke above the 200-day moving average.

The market has also reclaimed the $60K and $65K levels and is moving towards the $68K resistance zone, which could be the last hurdle before creating a new all-time high. With the RSI also indicating that the price has clear bullish momentum, it could be just a matter of time.

Source: TradingView

The 4-hour chart

Looking at the 4-hour chart, it is evident that the price has been rising rapidly since breaking the downtrend line to the upside. The market also broke the $65K resistance level with momentum, turning it into a support.

While almost everything points to a new record high in the coming weeks, there is one worrying sign. The RSI is showing a clear bearish divergence between recent price highs, which could indicate a correction or even a reversal in the near term.

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Cryptocurrency Charts by TradingView.

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