Bitcoin

History suggests Bitcoin will be a better long-term investment than little-known Meme coins

Published

8 months ago

27 May, 2024

History suggests Bitcoin will be a better long-term investment than little-known Meme coins

The value of some meme coins may be skyrocketing right now, but that doesn’t make them better investments than the original crypto.

Something interesting is happening in the crypto market right now. While Bitcoin (Bitcoin 1.26%) increased 65% in the year, some popular meme coins are appearing in even higher percentages. So far in 2024, Dogecoin (DOGE 0.68%) increased by 85%, Shiba Inu (SHIB 5.29%) rose 147% and little-known meme coin PEPE (PEPE 3.38%) increased by almost 1,000%.

It’s starting to look a lot like 2021, when the crypto market experienced its last major bout of meme coin mania. While it may be tempting to invest in these soaring currencies, history suggests that long-standing sector stalwarts such as Bitcoin will end up being better investments.

Short-Term Returns Versus Long-Term Returns

The main problem with speculative meme coins is that they are only built for the short term. Yes, they can deliver dazzling returns over short periods, but when you zoom out and consider their performances over a longer horizon, the picture becomes much less appealing.

To take Dogecoin, for example. In 2021, it has seen spectacular success, rising from mere pennies to an all-time high of $0.74 in just a few months. But then, Dogecoin fell back to earth and now trades for just $0.17. In its nearly 10-year history, Dogecoin has never surpassed the $1 mark.

Compare this performance with that of Bitcoin, which has been delivering triple-digit annualized returns for over a decade. From 2011 to 2021, Bitcoin was the best performing asset in the world, and it wasn’t even close. Bitcoin delivered annualized returns of 230%, compared to around 20% for the technology sector Nasdaq-100 index. Yes, Bitcoin has had its down years, but in the long run, it has been good for investors.

The scarcity effect

Another factor in Bitcoin’s favor is scarcity. The total number of Bitcoins that can exist is 21 million coins. Currently, 19.7 million of them have already been mined, and the rate of mining new ones was again halved last month. This creates a real scarcity effect, especially now that large institutional investors are buying Bitcoin.

When you compare Bitcoin’s circulating coin supply to that of the Shiba Inu, the contrast is particularly striking. Shiba Inu has a circulating coin supply of 589 trillion. This explains why it is highly unlikely to reach a price of $1, as that would give the meme coin a market value of $589 trillion. By way of comparison, the current market capitalization of the entire S&P 500 is approximately $44 trillion.

And the story is pretty much the same with other meme coins. The key to its initial success was the release of a huge initial supply of coins, often measured in trillions of coins. This elevates them to multi-billion dollar market capitalizations, even at absurdly low prices measured in tiny fractions of a cent. This strategy can give even a coin that has only been around for a few months a market capitalization of over a billion dollars, making it look like a relatively safe investment. Pepe, for example, exploded out of nowhere to become a top 25 cryptocurrency, largely based on its impressive supply of 421 trillion coins.

To make matters even worse, it is now possible to create a new cryptocurrency in just a few minutes and have it ready for trading in just a few more minutes. Crypto speculators are creating literally thousands of new coins daily. If one of them attracts some attention and achieves great success, they will make a huge profit. And if it doesn’t, well, they only wasted a few minutes of your time creating it. Thus, meme coins are no longer as “rare” as they seemed to be just a few years ago when Dogecoin and Shiba Inu reigned supreme.

Dutch tulips and coins meme

In many ways, the current speculation surrounding meme coins reminds me a lot of the 17th century bubble known as Dutch Tulip Mania. This is widely considered to be the first speculative asset bubble of modern times, and has been brilliantly described in works such as Charles Mackay’s Extraordinary Popular Delusions and the Madness of Crowds.

For a time, Dutch traders were willing to pay absurd amounts for particularly rare tulip bulbs – a single one could fetch a price equivalent to the annual salary of 10 skilled workers. But the story did not have a happy ending for speculators. Eventually, it became impossible to find new buyers willing to pay more than the previous ones, and the price of lamps quickly plummeted.

Bitcoin as “digital gold”

Of course, there were skeptics who suggested that Bitcoin Could Be a Dutch Tulip Bulb also. They claim that the price of Bitcoin could eventually fall to zero, eliminating speculative crypto traders in the process.

Image source: Getty Images.

Maybe that’s the case, but I doubt it. It’s been more than a decade since people started making these claims, and what has been the result? Bitcoin has become more valuable, not less valuable, over time. And that’s because Bitcoin has more in common with a precious metal like gold, due to its inherent scarcity. In fact, many crypto investors often refer to Bitcoin as “digital gold”.

So if you are thinking about buying meme coins now, I have just one piece of advice for you: buy Bitcoin.

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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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