Bitcoin has become nothing short of a nightmare for its investors over the past year. It leaves individuals who bought into the cryptocurrency at its height with quite the conundrum. Sell at today’s prices and accept the 80%-plus fall from late 2017’s peaks of $19,783.06? Or hang on in the hopes of a stunning comeback, but risk your holdings becoming ultimately worthless?
Sounds melodramatic, right? Not in my book. Who knows what Bitcoin is really worth? There’s reasons why the asset could rise again in 2019 should steps to regulate the asset proceed as hoped and provide it with some much-needed legitimacy. There’s plenty more that could send it still lower, however, from the possibility of fresh controversy surrounding so-called currency forks, to more worries over who actually owns and controls the asset class.
Indeed, recent news related to the latter point has really left me cradling my head in my hands in despair. It’s emerged that investors at Canada’s biggest cryptocurrency exchange, QuadrigaCX, are unable to unlock their coins (currently estimated at a colossal C$190m). Why? Chief executive Gerald Cotten unexpectedly died in India before Christmas. And he reportedly took the password that was used to gain access to the assets with him to his grave.
Too much danger?
There’s plenty of Bitcoin bulls out there who remain resolute in their belief that the currency has the potential to change the world as our increasingly-digitalised and global culture demands a more dynamic way to do business. They argue, therefore, its best days remain ahead, and that a price bounce-back is only a matter of time.
Bitcoin participation isn’t sensible investing though, in my opinion. I’m not pooh-poohing their enthusiasm. Some of their arguments do indeed strike a chord, with me at least. However, the huge question marks still hanging over the future of Bitcoin and the broader crypto space, and thus the possibility of more extreme price volatility, makes it a gamble too far.
I wouldn’t consider dip buying into the cryptocurrency for one second, but that’s not to say I’d sell my coins if I held any right now. It could still follow the lead of other tech giants like Apple and Amazon in sinking before rising like the proverbial phoenix from the flames. Had I invested near the Bitcoin price summit I don’t think I could swallow the painful losses without ripping my hair out, certainly not while there’s still a chance it could reclaim those losses.
I’d invest here instead
If you’re looking to get rich, then a much better way to use your money is to invest in the stock market. And the data is there to prove it. According to a Hargreaves Lansdown report last year, there were 168 of its investors who had made £1m or more by investing in the markets via an ISA. This was up from three people just six years earlier.
With these stats why would anyone look to the likes of Bitcoin to make their fortune? With the right strategy, it’s possible to make a million from shares, a much more secure way to use your hard-earned cash that investment in crypto.