Bitcoin Magazine: How I Preserve My Wealth With Bitcoin
Investors like cryptocurrencies when they’re moving higher. It’s been one of the best ways to make a quick buck in a bull market. However, those prices can quickly drop, and by much more than a bear market in stocks.
However, investors who look at the space for the long term may want to look at holding rather than trading. And the top crypto for that activity remains bitcoin.
While bitcoin has become the least volatile cryptocurrency, it can have 50 percent drops or more in the span of a year. Even during a bull run. However, over longer periods, owning bitcoin has far outpaced other asset classes.
More importantly, it’s outpaced inflation. Given the cryptocurrency’s use as, well, a currency, storing some wealth in bitcoin that can be used for trade in the future acts as a digital savings account. It’s also a far more liquid asset than real estate, and trades 24/7.
And as investors have seen with this year’s banking crises, bitcoin’s decentralized nature reduces the possibility for a single point of failure. Added to other assets such as stocks and bonds, a portfolio can enjoy more diversification and higher returns.
With the ease of buying and storing cryptocurrencies rising, starting to diversify into this asst class now can help lead to better returns in the years ahead.