Q#1. What's a bitcoin?
A#1. Bitcoin is a decentralized digital currency. That means it is not controlled by a single entity (the way a country's government controls the production and regulation of that country's money) and it does not exist in a physical form, the way there are coins and paper money.
One bitcoin is made up of 100 million satoshis (sats), similar to how 1 US dollar is made up of 100 cents. Because the price of 1 bitcoin is now tens of thousands of dollars, I buy sats, which is like buying a .10 carat diamond instead of a 1 carat diamond.
Unlike the US dollar which the government can print more of at any time, there will only be 21 million bitcoin. As of April 2022, 19 million bitcoin are currently available with new ones being "mined" every day.
Also, every four years there is a bitcoin event called the "halving" when the number of new bitcoin becoming available is cut in half. To use the diamond metaphor again, think of it as half the diamond mines shutting down every four years - that means the supply of diamonds has gone down, so the price of each diamond that exists out in the world goes up.
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If you want a different metaphor, think of each bitcoin (there are only 21 million) as a seed to plant in a backyard. Digging up an oak tree seed every day to see how big it has grown isn't helpful. It's best to make sure the seed is safe and leave it alone ... for years.
Eventually, the bitcoin tree grows big enough that you take some leaves (sats) and sell them to get fiat money (dollars, pesos, Euros, yen, whatever you need). The sats you've sold do not grow back (only 100 million sats per bitcoin), so it's best to only sell them once they are worth a lot of money, which means waiting/hodling.
Similar to how real estate is appraised for taxes, bitcoin is appraised every minute of every day - which can be very distracting, since the appraisals go up and down A LOT. What hasn't changed is a cycle of the appraisal being very high about 16-18 months after a halving, which happens every 4 years, followed by a significant drop.
Therefore, waiting to sell sats near the top of the high run would result in getting the most cash per sat sold. If cash isn't needed at that time, keeping the sats through the drop and the slow 3 years (instead of selling them) means having sats to sell when there's another high run in 4 years. And the 4 years after that, and the 4 years after that, etc. - where the sats are estimated to become 10x more valuable during each cycle.
Q#2. How did you buy your bitcoin?
A#2. I bought my bitcoin each month on my iPhone using the Cash app, which is a software wallet. My first purchase of bitcoin with the Cash app was $1 so I could see how their process worked. When I used a Cash app "boost," the Cash app gave free sats as a reward for using their debit card to purchase at specific locations/industries such as restaurants and coffee shops, similar to how a credit card rewards purchases at certain locations/industries with "cash back" offers.
As the sats accumulated, I moved them to a Ledger hardware wallet. This means they are safe, even if anything should happen to the Cash app or my phone.
Q#3. Why are you convinced bitcoin will keep going up?
A#3. Three main reasons ...
1. There will only ever be 21 million bitcoins (unlike paper money which the government can, and has, printed more of whenever they wanted). As of April 2022, 19 million bitcoin have been mined. The last bit of bitcoin will be mined in the year 2140, therefore you are still early and can buy some bitcoin to financially safeguard your future.
2. Bitcoin's halving cycle, which is when the amount of bitcoin that is given as a reward to miners is cut in half. ecoinmetrics' "After the halving" charts shows the data I'm most interested in.
3. Because strategy.com shows "risk-adjusted returns of currencies, indexes, metals, stocks, & bonds vs BTC" and barring 1-2 exceptions out of the 150+ listings, bitcoin out-performs the other assets over 5 years.
Switch the "Select Card Display Type" at the top of the page to INVESTMENT for the money numbers (accurate as of March 14, 2022) such as
... $1.00 invested in the Vanguard Long-Term bond for 5 years became $1.10 while $1 invested in bitcoin became $39.53.
... $1.00 invested in the S&P 500 for 5 years became $1.82 while $1 invested in bitcoin became $39.53.
... $1.00 invested in Apple stock for 5 years became $4.78 while $1 invested in bitcoin became $39.53.
Q#4. If you like bitcoin so much, why don't you buy more?
A#4. When I have more money to invest in buying bitcoin that doesn't affect my current standard of living and ability to pay bills, I do. The purpose of this website is to show how purchasing small parts of a bitcoin (sats) is worth time and trouble to do so. For example ...
... $15 X 12 months = $180.
Assuming that value increases by 10x in 4 years (as bitcoin has historically done), 1 year of investing $15/month in bitcoin is now worth $1,800 when held for 4 years.
- You would have to save $37.50 every month for 4 years to reach that same value.*
- Or you could have saved $150 every month for 1 year.*
Assuming that same $1,800 stays invested in bitcoin, and bitcoin increases by 10x again over the next 4 years, that means 1 year of investing $15/month in bitcoin is now worth $18,000 in 8 years.
* This are simple calculations that do not take into account inflation which will make your fiat money worth less every year.
Q#5. Why is this website so ugly?
A#5. Because it's hand-coded html and css.
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