Bitcoin (BTC-USD) may be one of the most volatile assets on the market today. However, it can also be one of the most profitable — if investors choose to have patience, buy in thoughtfully and hold it for the long term.
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Created in January 2009, Bitcoin is over 13 years old but the cryptocurrency has yet to run out of steam. However, it has become a massive asset, and old strategies to invest in Bitcoin are becoming obsolete.
The unique aspect of Bitcoin is how it is generated. In simple terms, Bitcoin is generated through mining, where a miner allocates his computing resources to the Bitcoin network and is rewarded by getting Bitcoin in return. The miner can then sell those Bitcoins to an online exchange for other currencies.
However, every few years, the rewards are cut in half. As a result of this halving, BTC spikes in value every few years. This spike is called a bull run.
As a result of these supply algorithms, Bitcoin can be very profitable to hold for the long term.
Bitcoin’s Price Stabilization Requires More Realistic Goals
It is crucial to mention that these bull runs are becoming less and less profitable, and the crashes that follow these price increases are becoming less significant.
According to a chart shared by Colin Talks Crypto, from the peak price of $31 in 2011, Bitcoin’s value rose by 3700%-plus in less than a year to $1,153. The next major bull run of 2017 saw a 1700%-plus gain for Bitcoin from the previous high. Moreover, each bull run had a follow-up crash of 94%, 85%, and 84%, respectively.
According to CoinMarketCap, the last bull run of 2021 saw an all-time high (ATH) of $68,863, a 340%-plus increase from the previous ATH with a crash of 46%. These metrics show that BTC has seen quite a significant price stabilization, and if trends continue, Bitcoin might no longer be as risky as it currently is.
However, a significant side effect of this stabilization is that you will…
