The cryptocurrency world has seen a lot of highs and lows. With new entrants in the market every other day and cryptocurrency values reaching new highs and in some cases lows, the volatility has shown that investments can turn risky. Among these, bitcoin has managed to remain valuable and on top of the crypto food chain.
Wondering how to buy Bitcoin? Just sign up on a crypto exchange platform. Because of its price volatility and great connection to equities, financial gurus like to argue that bitcoin (BTC) is just a replacement for the Nasdaq.
While that statement might not be technically correct, there is a certain amount of merit to it, for reasons other than what they believe. Just like the top NASDAQ-listed firms, Bitcoin will most likely be the engine of investment returns in investors’ portfolios in the 2020s, much as the top Nasdaq-listed firms were in the previous decade.
Prior to the United States election in November 2020, it was said that the regulatory danger to bitcoin was already lower than the regulatory risk to Nasdaq listed giants. Due to the concerns about election interference and manipulation the public sentiment turned against these data sector companies. Terms like “surveillance capitalism” have entered the conversation.
As the public became aware that these firms have the potential to defraud the people, governments have increased their monitoring of this particular sector. These companies have the potential to swindle us by:
- providing us with services that have essentially no marginal costs to generate and are worth considerably less than the data we supply them
- breaching our privacy by collecting and selling our data to other parties
- By offering serotonin doses for “likes” and connections that are addictive in nature and make us unhappier overall, we are basically hacking the primitive component of our brains.
- Because of the continual stimulus, we are losing our capacity to focus and reason.
- constructing echo chambers that foster polarization and hostility
- disseminating disinformation that may undermine democracy
- transforming journalism into a clickbait-based economic model
By increasing the pace of automation in the American economy, there is a risk of eliminating jobs and lives. That was before the appointment of a competition regulator who seems to be eager to rein in internet monopolists and intensify measures by European authorities who were already on the same track. To summarize, the uphill regulatory road for Nasdaq elite members has become steeper, making it less probable that they will duplicate the 10x return earned in the previous decade, in the coming years.
Bitcoin’s importance in the coming decade
To appreciate bitcoin’s significance in the future decade, consider inflation. Inflation is tough to anticipate because it has a significant social and psychological component. It may take some time for the crowd to adjust its expectations for the future, demand greater pay now, bargain to lock in future salary increases, and complete the inflationary wage/price spiral.
The following are some of the most important inflationary factors:
- Deglobalization as a result of the pandemic and escalating geopolitical strife among big powers lowers global access to both low-cost goods and labor. This boosts the total cost of manufacturing for products and services.
- Domestic labor pool decline owing to the departure of the boomers cannot be countered by new labor force arrivals since Generation Y is so tiny. The worldwide demographic picture is similar. In recent decades, falling birth rates have resulted in fewer and smaller cohorts of young people entering the labor market. Inflation rises when there is less labor.
- Increased government deficit spending as a result of a variety of circumstances, including entitlement payments, needs increased government borrowing and monetization of government debt. This raises the amount of money chasing after goods and services.
Gold ownership for investment reasons was forbidden in the 1940s. That didn’t stop many Americans from holding it and using it to defend their purchasing power. Gold was the single best-performing major asset in the 1970s. Annualized returns on gold investments were about 30%. Stocks, on the other hand, returned just 5% on an annualized basis. With yearly inflation of more than 7%, equities lost at least 2% of their buying power each year throughout that decade. Bonds lost 4% each year in real terms.
This takes us to bitcoin, often known as digital gold. Bitcoin has over $600 billion in total network value, which is roughly the amount of the top seven Nasdaq members a decade ago. If you’re interested in diversifying your portfolio, you can buy usdt, ethereum, solana, ripple and other cryptocurrencies that have performed well in the past year. Wherever you choose to invest your money, make sure you take a well informed decision.
