The prices of financial assets go through cycles. Sentiment will rise and fall, and there will be dull periods when you have to shake off less patient investors. I encourage you to take a look Bitcoin (BTC USD) during its quiet period as this is the perfect time to be a buyer.
Admittedly, 2024 is inherently interesting because it is an election year. Should this influence your decision to buy Bitcoin? That’s a fair question, but don’t let political considerations distract you from the most important reasons why you should add some “digital gold” to your portfolio.
Bitcoin: The thrill is over (for now).
The first half of 2024 has been unusually exciting for cryptocurrency enthusiasts. First of all, finally the US Securities and Exchange Commission approved some Bitcoin exchange-traded funds.
Furthermore, Bitcoin experienced its Halving/halving event, in which the reward for mining Bitcoin was halved. This event, intended to limit the growth of the circulating supply of Bitcoin, typically only occurs every four years.
Don’t expect the rest of 2024 to be as exciting as the first six months. Although the upcoming presidential election could be an exciting event, I do not recommend predicting Bitcoin’s next price move based on politics.
The The Biden administration’s stance about Bitcoin is not entirely clear. Direct statements from President Biden on Bitcoin are hard to find. The SEC has approved spot Bitcoin ETFs under the Biden administration, but that is not a direct endorsement of the cryptocurrency.
Meanwhile, former president and current presidential candidate Donald Trump recently joined expressed his support for Bitcoin. However, whether anyone, be it Biden or Trump, can actually push pro-crypto policies through an extremely dividend-heavy Congress is unclear.
Get some “Digital Gold”
Instead of focusing on politics, I invite you to think in terms of market cycles. A “trend phase” is often followed by a “consolidation phase”. This allows the market to digest its gains, possibly before the next rise.
I suspect the next step up will come when financial advisors begin to embrace and accept Bitcoin as a legitimate cash alternative. Currently financial advisor generally don’t trust or believe in Bitcoin.
Bitcoin’s path from $70,000 to $100,000 and beyond will be paved with the support of these advisors, in my opinion. Together they control huge amounts of investable capital. However, if you are a self-directed investor, you can forge your own path.
You may not want to keep too much cash in your account as US dollar inflation is frustratingly stubborn in 2024. Gold offers inflation-resistant properties – but this also applies to “digital gold”, i.e. Bitcoin.
You can see the value in Bitcoin’s limited supply, even if some financial advisors don’t seem to appreciate it. Sooner or later they will have to start recommending Bitcoin if enough customers ask for it. It’s probably just a matter of time.
Bitcoin: Let boredom work in your favor
I like the idea of buying high-condition assets when most people aren’t paying attention. Sometimes that means buying when others are selling. However, with Bitcoin right now, it means buying when the price action is boring.
After all, it won’t always be exciting. Consolidation periods are a good time to add to one’s position in anticipation of the next big price move. So leave the boredom behind and grab some “digital gold” before Bitcoin enters its next exciting phase.
At the time of publication, David Moadel did not hold, directly or indirectly, any positions in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to those of InvestorPlace.com Publishing Guidelines.
