I’M BUYING BITCOIN!
It all comes down to the bottom line. Leave everything else out of the equation.
Savings and comfort are the two elements that determine any commodity-based business’ future.
The mining costs set the low end for the price, while a premium is added thanks to any unique capabilities.
Bitcoin is a ménage à trois of commodities, digital, and IP aspects.
This is a key observation because it clearly explains the volatility that cryptocurrencies go through.
Like any commodity, there’s a price to be paid for extracting it. Coffee is grown, oil is dug and refined, silver is mined, and BTC is “mined” as well.
By the end of the year, it looks like the projected cost is nearing $9,000 per coin.
This means that today’s price is certainly an anomaly unless a technological breakthrough allows costs to drop measurably. These could be electricity expenses or an innovation within the hardware that allows mining to occur.
But even if Bitcoin’s mining cost goes down, which seems unlikely, it isn’t the only component of its spot price.
Besides being a commodity, it is a currency.
As such, it competes with all the other currencies for our business. People currently flock to BTC out of fascination, to own value outside the fiat system, for speculation, and for anonymity, but the future of it depends on business acceptance.
Bitcoin’s scaling capabilities are the key to that. You see, BTC is also a technology and a protocol, which means that substantial improvements make it more valuable.
In other words, as the Lightning Network evolves to allow cheap transaction fees and faster transaction times, merchants will slowly adapt to BTC, as they have with credit cards, online banking, and any other financial technology (FinTech) software they’ve accepted so far.
This adds a premium above this base cost of $9,000, which I consider the bottom.
Right now, merchants aren’t accepting Bitcoin on a grand scale, and it looks like it is losing the battle, so the price experienced a major decline with no V-shaped rebound, but further developments will change the sentiment again.
We already know that the mining costs play a major part in setting the market price and that transaction fees and times play a big role.
The added layer is speculative trading, which increases the volatility and volume of transactions.
The final factor, which is a temporary one, is regulatory issues. Until cryptocurrencies become widely accepted and lawful, news will keep influencing the short-term price for them.
Bitcoin is not just a cryptocurrency; it is the original one. It is the reserve currency for all the others, and it is completely decentralized.
These are unique traits that could, once again, be sufficient to see a renewed interest and a price rally.
My personal target is $20,000, which is a major psychological barrier as well. This presents a ridiculously juicy 300% profit over today’s price.
I’m walking the walk and going LONG Bitcoin.
Secondly, our team is now also interested in another unique commodity that is switching from being illegal to being announced as legal. It is widely used, has medical benefits, and is remarkably better than its competition.
The legalization of cannabis, finally allowing individuals to discover for themselves the truth behind this plant and its merits, is a great social victory.
I hate any government law that dictates what people should do with their own bodies, especially when it’s based on fear and not facts.
Two of my partners have already made millions with cannabis investments, so we’re definitely adding cannabis investments to the Pure Blockchain Wealth radar.