Is this question serious?
If you hold Bitcoin, from 500 to 5000, that's a 10-fold increase. What does that mean?
In other words, it will take about two cycles in the cryptocurrency market, which translates to a high probability of 5-10 years. The emphasis here is on high probability because no one can predict the future, and this time frame has no reference value. It is mentioned here to illustrate another issue.
The 3-5 times increase in Bitcoin during each cycle is visible to the naked eye. This visible underlying judgment is based on a conservative estimate of past cycle increases. Why be so conservative in the estimate?
From a long-term trend perspective, the scarcity and necessity of Bitcoin have not fundamentally changed. The total number remains constant, and due to various reasons, the quantity that disappears forever will only increase, not decrease. This leads to a further reduction in total supply, meaning scarcity will become more prominent. Looking at historical data, whenever a cycle arrives, Bitcoin conservatively increases 3-5 times from the low to the high. Is there basis for this?
Okay, if you agree with the analysis above, novices in the crypto market should know what to do. Never engage in simple numerical games like the problems mentioned; it only has downsides. According to the temptations of the crypto market, it is a false proposition for novices to hoard Bitcoin for 5-10 years. Let's take a look at a set of data organized by the Pengpai Financial Research Institute.
In the Bitcoin market, more than half of Bitcoin buyers hold between 0 and 0.001 Bitcoin, accounting for 51.42% of all Bitcoin buyers, but only 0.023% of the total. The concentration of Bitcoin is also very high; over 97.9% of accounts hold at most one Bitcoin, with 38 million accounts holding less than 1 million Bitcoins in total. The remaining 2.12% of accounts hold a total of 17.59 million Bitcoins, with a market value close to 100 billion USD. Only two accounts hold over 100,000 Bitcoins, with the latest data showing they hold 147,000 and 139,000 Bitcoins, totaling 16 billion USD.
What do the above data indicate? It shows that retail investors or novices basically do not hold Bitcoin. It's not that everyone can't afford it, but rather a lack of understanding of Bitcoin's value, a correct understanding of Bitcoin's price, and self-awareness of the investment system. Why is that?
Doubting the underlying characteristics of Bitcoin, doubting its long-term value, not understanding what the necessity of Bitcoin is. When it’s hard to hold onto a bit of Bitcoin, as soon as there’s a bear market or an international black swan event, they quickly sell their chips. How do you explain that? It’s normal to observe carefully; in a bear market, Bitcoin can drop by 70-80%, and a black swan event can cause a drop of several tens of percent. How many novices, who don't understand what Bitcoin really is, can hold on? It can be said very clearly that Bitcoin has surpassed the understanding of this part of people. Please leave quickly; if you don’t, there’s only a dead end.
Moreover, novices generally do not have much capital. Seeing the current price of Bitcoin, they think it’s already high and prefer to buy some imaginative altcoins. It’s a similar logic to the stock market, thinking that certain stock prices are too high and preferring to buy some lower-priced stocks, at least they can hold more! Little do they know, this is actually the biggest advantage in the crypto space; regardless of how high Bitcoin’s price is or how much capital novices have, they can buy the highest quality assets in the crypto space, which is not possible in the stock market. Do you think novices are wronged? A bright hard currency is right there, yet they refuse to take it and insist on picking up trash.
Lastly, let’s talk about one’s investment system. The cryptocurrency market is not a place to get rich easily. If you have no investment system or experience summary in other investment markets and rashly enter the crypto market, it is extremely perilous. The crypto space can be said to be filled with scammers, and the harvesting methods are ten thousand times crazier than in the stock market. The root cause is that the crypto market lacks regulation. We are all adults and should easily understand the meaning of regulation.
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