Crypto is no safe haven As investors weigh the possibilities of a recession, many are looking for assets to protect them from the potential storm. But experts say crypto isn't the place to find it.
If you had invested $1,000 in Bitcoin five years ago (around mid-2020), your investment would have grown significantly, potentially turning into anywhere from roughly $9,000 to over $14,000 by late 2024/early 2025, representing huge returns, though it wouldn't have been a smooth ride due to Bitcoin's volatility and price swings. The exact value depends on the specific date you invested, as Bitcoin's price fluctuates, but holding it through its major bull runs and pullbacks would have yielded substantial profits.
The 1% Rule in crypto (and trading generally) is a risk management strategy where you never risk more than 1% of your total trading capital on a single trade, calculated using a stop-loss to cap potential losses, protecting your account from devastating losses and allowing for consistent, long-term survival in volatile markets. For example, with a $10,000 account, the maximum loss on any one trade should be $100, achieved by sizing your position based on your entry price and stop-loss level.
British bank Standard Chartered projects that Bitcoin's price will reach $500,000 in 2030. Multiple prominent figures, including Coinbase CEO Brian Armstrong and Block CEO Jack Dorsey, have expressed their belief that it could reach $1 million or more.
That same year, Buffett expanded on those thoughts in an interview with CNBC: “In terms of cryptocurrencies, generally, I can say with almost certainty that they will come to a bad ending. We don't own any, we're not short any, we'll never have a position in them.”
Despite this, Musk never entirely abandoned Bitcoin. He has repeatedly described himself as a supporter of “crypto in principle”, often distinguishing between its technological merits and its environmental footprint.
In 1957, Buffett, in a letter to limited partners, suggested that 70% of his company's capital was invested in stocks and 30% in corporate work-outs.
During the coming 10 years, though, it wouldn't be surprising to see Bitcoin's price rise 10-fold, which translates to a 26% annualized gain. For what it's worth, Bitcoin compounded at a yearly rate of 70% in the past decade.
Growing recessionary risk could weigh on crypto assets if economic concerns dent appetite for higher-risk assets. At the same time, a recession perceived to be driven by poor government policies could arguably boost demand for crypto because the assets' decentralized and borderless nature creates a potential shelter.
Turning $1,000 into $10,000 in one month requires high-risk, high-reward strategies, often involving aggressive business ventures like high-volume flipping (e.g., window washing, retail arbitrage) or online businesses (dropshipping, e-commerce) where you reinvest profits quickly, or trading volatile assets like crypto, but success isn't guaranteed and carries significant risk, so consider diversifying into safer options like starting a service business (lawn mowing) or freelancing high-demand skills.
Tesla dumped 75% of its bitcoin at one of the worst times, losing out on billions. After buying $1.5 billion of bitcoin in 2021, Tesla sold three-quarters of its holdings the next year as the market was tanking.
Yes, making $100 a day in crypto is possible but requires significant capital (often $2,500+), a solid trading strategy, strict discipline, and effective risk management, as it involves high risks, especially with day trading and leverage; it's not a get-rich-quick scheme and often demands treating it seriously, like a craft, with consistent learning and market monitoring.
If you had invested $10,000 in Bitcoin in 2013, your investment would likely be worth millions today. In 2013, Bitcoin's price ranged from $13 to $1,000. Assuming an average purchase price of $200, you would have acquired approximately 50 BTC. As of November 2024, Bitcoin's price is around $37,000 per coin.
If you're holding crypto, there's no immediate gain or loss, so the crypto is not taxed. Tax is only incurred when you sell the asset, and you subsequently receive either cash or units of another cryptocurrency: At this point, you have “realized” the gains, and you have a taxable event.
If you invested $100 in Bitcoin 10 years ago (in late 2015) when it was around $330 per coin, you would have owned about 0.303 BTC. At today's price of $102,000 per Bitcoin, your investment would now be worth $30,906. That's a 309 times return over 10 years, turning a hundred bucks into over thirty thousand dollars.
On May 22, 2010, known now as "Bitcoin Pizza Day." Laszlo Hanyecz, a programmer from Florida, made history by using Bitcoin to purchase two pizzas from Papa John's. Hanyecz paid 10,000 Bitcoins for the pizzas, an amount that was worth about $41 at the time.
Since many belong to custodians and institutions, the number of individuals who actually own 1 BTC is probably well under one million. Owning a single Bitcoin places you among the top 0.1% of all Bitcoin holders, as rare as owning a high-end property in the digital economy.
Once the last bitcoin is mined, block rewards disappear. Miners will then rely entirely on transaction fees to earn revenue. These fees are paid by users whenever they send Bitcoin, and they'll need to be high enough to keep miners incentivized to secure the network.
Bitcoin Can Go Lower, But Probably Not to Zero.
In 2010, Bitcoin's price was approximately $0.08. A $10,000 investment at that time would have purchased about 125,000 Bitcoins. By 2025, with Bitcoin's value at around $50,000 per coin, that investment would be worth an astonishing $6.25 billion.
“If you told me you own all of the Bitcoin in the world and you offered it to me for $25, I wouldn't take it because what would I do with it?” Buffett said during a 2022 Berkshire Hathaway shareholders meeting. “I'd have to sell it back to you one way or another. It isn't going to do anything.”
Your $500,000 can give you about $20,000 each year using the 4% rule, and it could last over 30 years. The Bureau of Labor Statistics shows retirees spend around $54,000 yearly. Smart investments can make your savings last longer.
Warren Buffett has long been known for two rules: Rule No. 1: Never lose money. Rule No. 2: Never forget Rule No.
If you invest $100 a month for 30 years, you could have anywhere from around $97,000 to over $240,000, depending on the average annual rate of return, with higher returns (like 10% vs. 6%) leading to significantly more wealth due to the power of compound interest, with total contributions reaching $36,000. For example, a 6% return yields about $98,000, while a 10% average return (closer to historical stock market averages) could grow to over $240,000 over three decades.