Want to buy Bitcoin quickly with a credit card, debit card, check, or bank wire?  Go here to read our FREE tutorial that walks you through buying your first cryptocurrency.  Designed for people that do not know about cryptocurrencies.


Why Invest in Bitcoin?

We assume you read the previous FAQ on What is Bitcoin?  In that article, and the official Bitcoin website, it says Bitcoin is a currency.  Why Invest in Bitcoin?

Let's start by looking at some common investments and compare those versus Bitcoin.


Real Estate as an Investment

Real estate is hard to calculate an overall average price for year to year.  Here is one website that attempts to define the return on real estate:

US housing prices since 1900

This website tries to look at all the costs associated with owning a home (maintenance, taxes, etc).  However, this graph shows the peak of housing prices in 2008 and only goes up to 2012.

Note that the US official census housing values only go up to the year 2000.  They should have values for the year 2010 - have they omitted those values?  Because of the real estate crash around 2008?  We do not know.

Census housing values

I don't think we can accurately state a price on 1/1/2015 and 1/1/2018 - and if we did - it would be so subjective - not sure it's worth trying to compare. Housing market gains and losses are regional.  Some regions do great, others decline.  Also, people tend to buy real estate for reasons other than investing.  (i.e. they need a place to live and don't want to rent).  However real estate is one of the top investments for many people - so we needed to address real estate as an investment.


Stock as an Investment

S&P 500 Prices

Here is the price of the S&P 500 index over the last three years:

S&P 500 Price

The price around 1/1/2015 was $2,025.90.  The price around 12/28/2017 was $2,713.06.  Notice how the graph was flat and then slowly starting rising around November of 2016.

We calculate this return to be about 10.2% a year.  Almost right on the long term average for stocks.


Gold as an Investment

Gold price

Here is the price of gold over the last three years

Gold Price

On 1/12/2015 the price of gold was $1,232.70 USD per oz of gold.  On 1/12/2018 the price of gold was $1,320.29 USD per oz of gold.  Notice how the graph is very choppy, without much rise.

We calculate this return to be about 2.3% per year.


Bitcoin as an Investment


Let's look at Bitcoin price over the last 3 years

Bitcoin Price

The price around 1/1/2015 was $291.34.  The price around 12/28/2017 was $13,444.88.  Notice how around March of 2017 - Bitcoin skyrocketed in value.

We calculate this return to be 11.3% per MONTH, and about 361% per year.

If you had invested $1,000 on 1/1/2015 - you investment today would be worth $46,148.  After three years.


Warning - research these returns for yourself

We have tried to give an accurate representation of risk and return for different types of investments. If you ask ten "experts" what the average annual return for each of these investments is - you are likely to get ten different answers. Do the research yourself and average the advice from different "experts".

Here is where you can find the historical prices and returns for cryptocurrencies:
Coin Market Cap
Crypto Compare
Yahoo Finance Cryptocurrency screener


Can this continue?

We think that we are in the early stages of Bitcoin becoming an international type of stock.  We think cryptocurrencies will become the international stock market.  We think the biggest challenge to Bitcoin investment is other crypto currencies that will steal growth from Bitcoin.  But we think that Bitcoin and other crypto-currencies will greatly out perform all other investments you can make.  But stay (or get) diversified.  Long term wise - none of us know exactly what will happen - to any of these investments we discussed.

Generating monthly income

Here is another concept to think about.  Using investments to generate income.  The typical investments used to generate income are dividends and annuities.  Annuities we do not discuss because you lose your investment.  Dividends can often return about 2.5% per year. If you have $1 million - you will earn about $25,000 per year.  However, you need to increase your base investment - to keep up with inflation - so you really have about $12,500 after reinvesting $12,500 back into your investment to try to keep up with inflation.

With Bitcoin, we estimate you generate about 11.3% a month.  If you have $1 million in Bitcoin (not hard to do if you invest $1,000 and leave it for 5 to 7 years) - now you are generating about $113,000.00 per MONTH (versus about $2,000.00 with stock dividends).  We do not suggest you go blow all this money.  Use about 20% of this money ($22,600 per MONTH) to live on and go have fun with.  Use about 40% to reinvest in cryptocurrency.  Transfer 40% to other investments such as the S&P 500 index and real estate.  Transferring money from your cryptocurrencies to stocks and real estate will give you a more diversified portfolio.

As your investment in crypto currencies grows - so does the allocation we recommend.  We cover that in our premium website.


What we do

Our goal via our paid website is to show you different strategies to earn more than 11.3% per month. There are investment strategies where you can earn money in crypto currencies that pay more than Bitcoin. You don't sit in front of a computer all day and have to day trade. You buy the cryptocurrencies we specify, sit back for a year, and wait. Then you can cash them and pay a low 15% long term capital gain OR we advise you stay invested until your crypto investments are over $1 million. We'll cover all of this, and a lot more, in our premium website.


Summary

Should you cash in all your investments and go put everything in Bitcoin?  No, absolutely not.  Should you consider taking some money and investing it in Bitcoin or other cryptocurrencies?  We think you should invest money weekly or monthly until your monthly returns exceed what you are putting in.  Then stop investing more money and use that money to learn and make things more secure (hardware wallets, fire and water proof safe, etc).  Leave that money in your investment for 5 to 7 years - when we expect you to have $1 million or more.  Then start using those monthly gains to provide case for living expenses and transfer to other investments.


Want to buy Bitcoin quickly with a credit card, debit card, check, or bank wire?  Go here to read our FREE tutorial that walks you through buying your first cryptocurrency.  Designed for people that know little about cryptocurrencies.