Don't Stop Believin', Hodl on to that Feelin': My Thoughts on the Bitcoin Economy
FYI I am in no way, shape, or form an investment professional. Please do not take this as investment advice.
Read that title again. Before you suggest I fire my editor, pull up the proverbial chair and stay awhile.
In the world of cryptocurrency, hodl is slang for the practice of holding (as opposed to trading) bitcoin (or Ethereum, Elon’s darling Dogecoin, and thousands of other cryptocurrencies). It also happens to be my own personal approach to the cryptocurrency market. I’ve been a Bitcoin hodler for years, watching—especially during the past few months—its value rocket to historic highs. The latest Bitcoin price record is but one recent event that has had investors spinning in 2021. The Reddit-fueled Gamestop (GME) short squeeze, followed soon after with calls to squeeze the silver commodities trade, rounded out a trifecta of excitement in American markets. In terms of long term potential, however, cryptocurrency is most consequential.
Cryptocurrencies are payment technologies that rely on blockchain, or digital ledgers that securely and anonymously record transactions in a public domain. The transition to, and trust in, blockchain―is revolutionizing and reinventing one of the most important foundations of modern society: financial systems. I’ve invested in Bitcoin, the world's largest cryptocurrency in terms of market capitalization, for many years, making me the target for my friends’ and family’s questions on all things related to the Bitcoin economy―especially now. Here’s what I find myself advising again and again:
Blockchain Technology Is Already Mainstream
Should I invest in Bitcoin?When? Cautious investors waiting for blockchain cryptocurrencies to cross some mythical threshold of acceptance before they get in are wasting precious time. Investing is a very personal and idiosyncratic matter, but I’m confident that if you are looking for a solid investment vehicle, diversifying with blockchain technology and cryptocurrency is a wise, and safe, option. Businesses across the US already accept bitcoin payments for goods and services, and more are joining them everyday. Tesla has invested in bitcoin as an alternative asset. Powerful banks like Goldman Sachs and Morgan Stanley are offering bitcoin exposure to their private banking client portfolios. And if Miami, the new tech capital of the United States, is considering paying employees in bitcoin, allowing residents to pay their taxes in bitcoin, and perhaps investing the city’s treasury in bitcoin, then we need to accept that blockchain is no longer underground, but mainstream, and accelerating further every day.
Blockchain Technology Is Democratizing the Financial World
Cryptocurrencies are borderless and bankless, meaning that global citizens can safely protect their financial assets even in times of profound volatility in their home countries. Hyperinflation in Venezuela, a nation still reeling after President Hugo Chavez’ death in 2013, has sent many Venezuelans in search of alternative currencies to the bolivar. Recent history, too, offers examples of when a borderless currency could have eased periods of political instability. Consider the case of Myanmar in 1990, or the Brexit crisis. Blockchain technology and cryptocurrency provides for secure and trusted financial transactions without the institutional hassle of moving money from one country to another, from one banking system to another. It’s broken down barriers and laid the foundation for a democratized investment framework– and this may just be the beginning.
Bitcoin: King Of The Crypto Category
In every conversation talking about Bitcoin alternatives―DogeCoin, meme stock or stonks―Bitcoin is the main comparison, the coveted “category king.” Such widespread awareness of Bitcoin only fuels speculation and further inflates the market. Just like any other marketing funnel, awareness leads to consideration and so on, and we’ve reached the point of no return on Bitcoin’s awareness. If my mom is aware of Bitcoin to the extent that she’s asking me for insight about it, the trajectory of Bitcoin adoption (and advocacy!) is on its way.
With any investment comes risk, and cryptocurrencies are no exception. That said, I believe in the power of the Bitcoin economy and its potential to revolutionize financial markets and replace fiat, or government-based, currencies. If you’ve weighed entering the Bitcoin economy, forget trying to time the market and get involved now. If you currently invest in cryptocurrency, keep on hodl’n on.
Jody Glidden is the founder and CEO of Introhive. Founded in 2012, Introhive is the fastest-growing B2B relationship intelligence service and data management platform. The company was recently recognised by Deloitte's Fast 50 and Fast 500 Awards and was named the 2020 MarTech Breakthrough Award winner for best CRM Innovation Software.