Bitcoin pessimism seemed in vogue at the end of 2019, as the largest cryptocurrency tumbled 30% from September 2 to December 31. However, at decade’s end, one thing is clear: The 2010s belonged to Bitcoin.
Bitcoin volatility deterred some investors, with alternating spikes and plummets of hundreds and even thousands of dollars within only a few hours. However, these types of price movements can be considered a maturation stage for emerging stores of value (see this Forbes article outlaying the Bitcoin-Gold comparison).
It’s helpful look past the day-to-day volatility to see the true success that Bitcoin has had in the last year and decade.
In January 2019, Sarson Funds’ John Sarson called bottom for the crypto winter as Bitcoin hovered around $3,600. Bitcoin finished the year strong, with a return on the year of nearly 100%, making it the highest returning investment of 2019, far beating the 31% return of tech stocks for the year.
While Bitcoin’s returns are impressive for 2019, however, they are minuscule when considering Bitcoin’s overall ROI.
Over the past decade, Bitcoin returned 8,900,000%. That’s right, if you invested 1 dollar in Bitcoin in 2010, you would have roughly $89,000 in your pocket right now. If that hasn’t caught your attention, why should you invest? Bitcoin is still in its infancy.
Looking forward, 2020 holds vast potential for Bitcoin. On May 13th 2020 is Bitcoin’s next scheduled halving. The halving of a coin is particularly important for price changes of a crypto (What is halving? Read about it in a Sarson Funds article here).
In short, a cryptocurrency halving event is when the mining rewards are cut in half, therefore decreasing the rate that the supply increases, making the coin more scarce. The halving of Bitcoin in 2020 is important because its last halving in 2016 began the historic bull run that put demand for Bitcoin at its all-time high of $20,089 in December 2017.
While it’s impossible to predict the halving’s effect on Bitcoin’s price, what is known is that 2020 will provide Bitcoin with a plenty of factors that could highly impact its price range in the coming years.
Based on what was seen after 2016, Sarson Funds is hopeful.
Disclosures: Not investment advice. It should be assumed that Sarson Funds or its affiliated managers hold positions in all projects that are discussed. It is not possible to invest in any project directly through Sarson Funds, Inc. or its affiliated managers. Any investment product offered by managers affiliated with Sarson Funds should be assumed to be only available to Accredited Investors and subject to the individual terms and conditions of that offering including but not limited to those eligibility requirements associated with U.S. Securities Regulation D, section 506c. Talk with your financial advisor before making any investment decisions or have them contact Sarson Funds directly at [email protected]
