Is Bitcoin A Good Investment Right Now?

Is bitcoin a good investment in 2020?






The price of Bitcoin has increased by more than 60 percent this year. Meanwhile, the S&P 500 has gained 3 percent, and the blue-chip Dow Jones Industrial Average is down 5 percent. Investors have piled into bitcoin amid the COVID-19 pandemic because they want to protect their portfolios. In these uncertain times, they put their money in assets unrelated to the central bank or traditional financial system. Because bitcoin operates on a decentralized network and may be less prone to adverse events in the conventional financial system, it carries some of its current investment hedge appeal.


Is investing in bitcoin a good idea?


Those looking to hold assets that are resilient to inflation may find investing in bitcoin a good idea. Central banks are currently pumping more money into the economy to avoid a recession, but that also increases the risk of inflation. While central banks can print an unlimited number of fiat currencies, the quantity of bitcoins that will ever exist is limited and fixed - the supply is capped at 21 million units, according to bitcoin creator Satoshi Nakamoto. Hence, there is no risk of inflation reducing bitcoin's value, as is the case with fiat currencies.


Is bitcoin a good investment now?


Bitcoin was launched in 2009, shortly after the 2008 global financial crisis. Whether bitcoin was built for the financial crisis is debatable. But here we are, facing the global financial crisis due to the coronavirus outbreak.


While Warren Buffett and Donald Trump have similar views on bitcoin, they generally see it as "having no value," billionaire investor Chamath Palihapitiya of Social Capital disagrees. Palihapitiya saw the bitcoin price rise to $ 1 million and recommended that investors dedicate 1 percent of their investment portfolio to bitcoin or cryptocurrency. Bitcoin has gone up massively since Buffett discredited it and Trump said its value was based on "thin air".


Is bitcoin dead in 2020 because COVID-19 rocked the global financial system?


Will bitcoin fall this year due to the burden of COVID-19? No one can predict the future, let alone an emerging digital asset like bitcoin. But the fact that bitcoin continues to beat the stock market this year amid the COVID-19 situation suggests investors are confident it will weather the storm. In fact, some investors thought another currency would crash: the US dollar. Rich Dad Poor Dad author Robert Kiyosaki argues that "the dollar is dying." The author also recommends using the government's economic stimulus check to invest in bitcoin.

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