Don't Buy The Bitcoin Dip

Credit : bitcoinmagazine.com

With the value of Bitcoin as soon as once more falling considerably under $100,000, the “purchase the dip” cheerleaders are in full power.

However I am right here to supply a unique perspective: Do not buy the dip.

Earlier than I’m going any additional, I want to make it clear that none of what I write on this Take is funding recommendation.

Why would I say one thing like that? Is it as a result of I all of the sudden hate bitcoin?

No.

I’ve different causes for making such a press release.

The primary is that I am making an attempt to stop you from turning into something abandon liquidity for most of these folks:

Don’t fret guys.

The retards are coming. pic.twitter.com/1YL8keRHYa

— Broodman (@BTCReadMan) January 8, 2025

The second is that I like to purchase bitcoin when it’s truly being offered at a reduction, and never simply when it seems to be being offered at a reduction.

Let me clarify.

At present, Bitcoin is buying and selling about 13% under its all-time excessive. Whereas on the earth of conventional finance which may be a big low cost for an asset, on the earth of bitcoin it’s barely greater than a every day fluctuation.

In four-year bitcoin cycles, the value of bitcoin tends to skyrocket through the years of and after the halving. After which the yr that follows is normally fairly dangerous for the value of Bitcoin. Throughout that yr, the value of bitcoin reaches a low, which is normally close to the excessive of the earlier cycle.

That was a bit complicated, so I am going to offer you an instance.

In 2022, the final “fairly horrible” yr, Bitcoin’s worth fell to round $15,500, which was truly round $3,500 decrease than Bitcoin’s high from the earlier cycle – $20,000.

If one thing related had been to occur in 2026, we’d see Bitcoin’s worth at round $53,000 (23% under the earlier cycle’s all-time excessive of $69,000). That will be a big low cost and a dip price shopping for.

I do not share this angle to discourage you from pursuing one thing like a dollar-cost averaging bitcoin funding technique (probably the greatest methods on the market for the typical retail investor). As an alternative, I am sharing it as a result of if a liked one got here as much as me and requested me if now was a superb time to purchase Bitcoin, I might say “not likely.”

I attempt to maximize the monetary profit (in fiat phrases) of investing in bitcoin for many who ask me to put money into it – particularly those that are new to it. And whereas I’d be capable of assist somebody commerce out and in of a bitcoin place over the subsequent yr, I do not like to do that as a result of I encourage folks to purchase and maintain bitcoin for the long run.

However Frank, the US may make an announcement Strategic Bitcoin Reserve and different nations can comply with swimsuit! And have a look at all of them Companies that buy bitcoin for their government bonds!

Sure, this stuff occur, and so do issues like Bhutan sells bitcoin and that features issues like Germany promoting bitcoin and Tesla promoting bitcoin.

And the next announcement was made simply hours after I first printed this piece:

JUST IN: 🇺🇸 The US authorities has licensed the sale of 69,370 #bitcoin A federal decide dominated that $6.5 billion price of Silk Highway had been seized. pic.twitter.com/dGB7S9iO8T

— Bitcoin Journal (@BitcoinMagazine) January 9, 2025

Till now, all bitcoin worth cycles have been related. So whereas it appears to be like like we’ve got one other yr of Bitcoin worth will increase in retailer for us, I believe we’ll fall a lot decrease than this present worth stage when the tables flip.

And that is after I begin proactively shopping for.

This text is a To take. The opinions expressed are solely these of the creator and don’t essentially mirror these of BTC Inc or Bitcoin Journal.