Is Bitcoin Still a Good Investment? How do you know?

00:01 hey everyone you may be wondering is
00:03 Bitcoin still a good investment which
00:06 you of course could be forgiven for
00:07 asking the question because Bitcoin has
00:09 been mostly trading sideways for the
00:12 past five or so months between mostly
00:15 $55,000 per coin and $70,000 per coin
00:19 okay so I’m going to make an attempt to
00:20 answer is Bitcoin still a good
00:21 investment obviously I think yes I’ll
00:24 explain why okay so first of all you’ve
00:26 got to zoom out uh the answer to all of
00:29 these things is always zoom out so if
00:31 you take the most transformational
00:33 Technologies of all time let’s say the
00:35 automobile the internal combustion
00:37 engine the um you know the internet uh I
00:42 don’t know you know electricity all of
00:43 those things if you uh if you take all
00:46 of those things over time and then you
00:48 zoom in to any 6 months or 12 months or
00:51 anything you can find periods of time
00:53 where it looked like the adoption of
00:55 that technology was not actually going
00:57 to happen so if you go look in the early
00:59 days of of you know the Model T Ford
01:02 with Ford I haven’t done this but I I
01:04 know this is the case for sort of just
01:05 macro uh you know macro investing um if
01:08 you zoom in on Amazon or Apple or Google
01:11 or Microsoft or um any of The
01:14 Magnificent Seven stocks which are the
01:16 seven highest performing stocks uh in
01:18 recent years um anyway if you zoom in on
01:21 any of those or the major technological
01:23 changes over time um you will see
01:26 exactly the sort of thing you see in
01:28 Bitcoin right now so let’s go back to
01:30 the uh let’s say the automobile just to
01:33 pick a random example so uh the internal
01:37 combustion engine is invented uh
01:39 automobiles come around but no
01:41 technology is adopted uniformly with any
01:45 technology you end up with early
01:47 adopters that jump on board quickly then
01:49 there’s sort of a lag where people are
01:51 trying to figure out hey is this real
01:52 and it just it takes time for the next
01:55 wave of people and people tend to adopt
01:57 Technologies in waves right they just
01:60 it’s not this linear thing so let’s
02:02 assume you had you know invested heavily
02:05 in the automobile and for five or 6
02:08 months the sales of automobiles let’s
02:11 call it the Model T Ford or whatever
02:12 let’s just assume that those are sort of
02:14 going sideways so you may lead that may
02:17 lead you to question your thesis which
02:19 is hey maybe people are not actually
02:22 going to adopt automobiles maybe we’re
02:24 just going to stick with the horse and
02:26 buggy indefinitely okay so what do you
02:28 do in that situation well the thing you
02:30 don’t do is just go look at the price or
02:32 go look at automobile sales because if
02:35 you zoom in on any of that it’s not
02:37 going to tell you what is going to
02:39 happen long term because again if you go
02:41 to any of the highest performing assets
02:44 or most transformational Technologies of
02:46 all time and you zoom in you can find 6
02:49 months or 12 months or 18 months at a
02:51 time where it looks like apple the
02:54 company is not going to make it or it
02:56 looks like maybe the internet will never
02:57 be adopted or whatever um so
03:00 uh let’s go back to the automobile so
03:03 the best thing to do is to go back to
03:04 just first principles which is okay
03:07 you’re heavily invested in automobiles
03:09 it’s the early 1900s and you’re
03:12 concerned that because you know adoption
03:14 of automobiles have temporarily
03:17 stagnated that maybe your investment is
03:19 you know is a bad one because maybe the
03:21 world is not going to use automobiles
03:23 okay again if all you do is just look at
03:25 the automobile sales numbers that can be
03:27 misleading because you can get a
03:29 flatline or
03:30 something which is called range bound
03:32 which is you know it’s bouncing around
03:33 between I don’t know 5,000 and you know
03:36 5,500 and 7,000 automobiles sold a month
03:40 and maybe it gets stuck there for like
03:42 six months just like the price of
03:43 Bitcoin seems mostly between you know at
03:45 a zero mostly between you know 50 uh
03:49 55,000 and 70,000 so you can get sort of
03:52 stuck there for you know potentially
03:54 extended periods of time so if you look
03:55 at that you could conclude hey maybe
03:57 we’re just not going to adopt
03:58 automobiles so the right thing to do is
04:00 to look at the underlying asset to say
04:03 okay what does an automobile do people
04:05 are using horses and Buggies and
04:07 Automobiles for transportation now is an
04:10 automobile a better means of
04:12 transportation than a horse and buggy
04:14 and you just go one by one and just say
04:16 Okay can it go faster or will it
04:18 eventually go faster yes does it require
04:21 all the maintenance and upkeep uh you
04:23 know of the care and feeding of physical
04:26 live animals the answer is no um does it
04:29 this does it that you go through the top
04:31 five or 10 attributes that make for a
04:34 great means of transportation and you
04:36 would quickly conclude that automobiles
04:39 are better than horses and Buggies they
04:41 just are which means you could conclude
04:45 okay that means eventually the you know
04:47 sale of automobiles will kick back in
04:50 and people will buy and you know move
04:52 over to automobiles again same with
04:54 electricity if you had 6 months where
04:57 the adoption of electricity instead of
04:58 kerosene uh just sort of you know the
05:01 adoptions seem to be stagnated you you’d
05:03 sit back and you say okay let’s talk
05:05 about this let’s think about this is
05:07 electricity and the electric light bulb
05:09 better than a kerosene lamp yes it
05:12 doesn’t make smoke it does not you know
05:15 it it you know it has the ability to
05:16 Glow brighter you know you go through
05:18 all the attributes for why somebody
05:20 might use electricity rather than
05:23 kerosene for lighting or heating or
05:25 whatever it is and you would conclude
05:26 that yeah maybe we seem sort of stuck in
05:29 the adoption of electricity
05:30 but electricity is going to get adopted
05:33 because it’s fundamentally better uh so
05:35 same is same is true for the printing
05:37 press same is true for you know anything
05:40 is you can just you can go to the
05:41 fundamentals so what does someone like
05:44 me do when the price of Bitcoin has been
05:46 mostly in the same range for five you
05:48 know five months well first thing I do
05:50 is I go look at the historical price of
05:52 Bitcoin and realize that this has
05:53 happened a bunch of times before that it
05:55 is totally normal for the price to get
05:58 you know stuck in a range for you know 6
05:60 or 12 months or even to go down for you
06:02 know 6 or 12 months and that does not
06:04 mean bitcoin’s broken it means that in
06:06 the natural adoption Cy cycle of any
06:09 technology and again you go back and
06:11 look at the Magnificent Seven stocks and
06:13 look at the first you know 16 years
06:15 since since Bitcoin is 16 years old go
06:18 look at the you know Magnificent Seven
06:19 stocks in the first 16 years of their
06:21 lives and you can zoom in and you can
06:23 find periods where they’re sideways for
06:25 six months in their stock price or they
06:27 go down for six months or 12 months or
06:29 18 months
06:30 um it just happens it’s e even with
06:33 Technologies and companies that
06:34 ultimately be are transformative if you
06:36 zoom in you can find periods of time
06:38 where they’re behaving uh just like
06:40 Bitcoin is behaving today and it does
06:42 not mean anything’s wrong with that
06:44 company or technology or with Bitcoin it
06:47 just means that temporarily you know
06:49 market adoption is what it is and
06:51 there’s a lot of Dynamics in play for
06:52 reasons people would adopt automobiles
06:54 reasons they would adopt electricity
06:56 reasons they would adopt the internet
06:58 and all that sort of stuff and that’s
06:60 just totally normal so as it relates to
07:03 bitcoin you know if the price seems
07:05 stuck I go back to okay let’s go to the
07:08 most fundamental questions we can ask
07:11 about Bitcoin what are the most
07:12 fundamental questions one is the concept
07:15 of money a technology that is valuable
07:18 to humans yes it is okay we’re not going
07:21 to go back to barter so yes money is
07:23 valuable okay number two do I believe
07:26 politicians are going to suddenly be
07:28 super responsible and that fiant
07:30 currencies are going to stop losing
07:31 value every year no I’ve been in the I
07:34 served for eight years in the House of
07:35 Representatives I’ve been in and around
07:37 politics for you know the better part of
07:40 two decades nothing inside me believes
07:43 politicians are going to suddenly be
07:44 responsible with money and nothing about
07:46 human history would lead anyone to
07:49 conclude all the way back to Roman
07:51 duckets and all this sort of stuff
07:53 nothing nobody would ever conclude that
07:55 a currency that can be de debased by
07:58 humans will not be debased by humans so
08:01 if something starts out 100% gold coin
08:03 then it goes to 95 90% 70% 65% you know
08:08 52% like they’re just going to dilute it
08:10 like if humans can mess with the money
08:12 they will mess with the money and so
08:14 okay so so money is a valuable
08:16 technology we’re not going to stop using
08:18 money politicians are not going to be
08:20 responsible uh we’re not going back to
08:22 Gold again I’ve done enough work uh to
08:24 feel confident that I know we’re not
08:26 going to go back to gold as the uh as
08:28 the money that we use uh as a nation uh
08:31 one it already got taken away between
08:33 1933 and 1976 all of the the gold that
08:36 could be used as money was confiscated
08:38 by the federal government of the United
08:40 States so one it’s not going to it’s not
08:42 going to work his money because it
08:43 already got taken away one time and if
08:45 they took it away once they can take it
08:46 away again uh second which you know they
08:49 can’t with Bitcoin uh second gold is not
08:52 divisible it’s not it doesn’t have the
08:55 uh monetary properties that Bitcoin has
08:58 as far as divisibility authenticated
08:60 ability the ability to send it over time
09:02 and space and gold is you know they’re
09:05 digging about 2% more gold out of the
09:07 ground every year which means every 36
09:09 years the total amount of gold in
09:12 circulation doubles well as population
09:15 growth starts to uh fall off which it is
09:18 uh you know expectations are somewhere
09:20 between 9 billion and 10 billion people
09:21 in the world uh population growth will
09:24 will go sideways and there will not be
09:25 population growth but the total amount
09:27 of gold in the world uh getting dug out
09:29 of ground is going to keep going up you
09:31 know 2% a year so uh just on the
09:34 fundamentals of its monetary properties
09:36 Bitcoin is better than gold so we’re not
09:39 going to stop using money as a
09:40 technology politicians are not going to
09:42 be start being
09:43 responsible uh we’re not going back to
09:46 gold which means we are going to use
09:48 some form of money that works and cannot
09:50 be debased and Bitcoin obviously is I
09:53 believe that money so I go through the
09:55 fundamentals of okay is Bitcoin durable
09:57 is it divisible is it authenticatable
09:59 does have every single element of what a
10:03 perfect monetary system would have in
10:05 the world and the answer is yes can I
10:07 buy Stu with Bitcoin yes with the
10:09 Bitcoin uh coinbase debit card I can go
10:11 buy anything with a debit card and for
10:13 larger purchases I can use the actual
10:14 just Bitcoin Network so you know
10:17 recently I guess it was earlier this
10:19 week or late last week um I was paying
10:21 somebody and uh they sent me a Bitcoin
10:23 invoice and I you know pasted it over
10:26 into a Bitcoin wallet and it said hey do
10:29 you want to pay pay this person you know
10:31 this amount of money and I clicked yes
10:33 and it said done and it was done and it
10:35 was amazing and we did not have to worry
10:38 about uh you know which whether we were
10:40 on venmo or PayPal or zel or any of the
10:44 different apps we didn’t have to be on
10:45 the same app um we didn’t have to
10:48 interact with anyone that could freeze
10:49 accounts suspend accounts require
10:52 authentication it’s just hey I can
10:55 transmit value as easily as I can send
10:57 an email to anyone in the world as easy
10:59 as I can send an email I can transmit
11:01 value with Bitcoin and it works
11:03 incredibly well and it’s just amazing
11:05 technology so every time I use Bitcoin
11:07 uh that like native Bitcoin I’m like
11:10 this is just amazing technology again
11:12 similar to you flip a switch and a light
11:14 bulb turns on or you get in a Model T
11:17 Ford and you drive around and you think
11:20 I really really really think everybody’s
11:21 going to use this instead of a horse and
11:23 buggy like maybe temporarily it’s
11:25 they’re sort of not but when you
11:28 experience the technology yourself and
11:29 you’re like
11:30 I’m just really really really certain
11:32 that this is the future and that’s how I
11:34 feel about Bitcoin every time I use
11:35 Bitcoin I’m like this there’s just no
11:38 possible way this is not the future
11:39 monetary system of the world it checks
11:41 every box so again I don’t look at any
11:44 investment as it’s a good investment
11:46 because the number’s going up in fact
11:48 often you know Investments that people
11:50 buy only because the numbers are going
11:52 up but they don’t actually understand
11:54 you know the underlying technology ends
11:56 up being an investment where the number
11:57 ultimately goes down so um so I don’t
11:60 buy things because I think the numbers
12:02 you know is going up I buy things
12:04 because I think they have an incredibly
12:06 High underlying fundamental value and
12:09 that that underlying fundamental value
12:12 will eventually be represented in their
12:14 price uh that may be represented in the
12:16 price today it may be represented in the
12:18 price in the future but it always
12:20 eventually gets represented in the price
12:22 So eventually people did adopt
12:25 Automobiles and eventually the you know
12:28 the automobile companies that were
12:29 successful in the automobile Marketplace
12:31 made money eventually people uh adopt
12:34 electricity and the companies that were
12:36 built on uh the adoption of electricity
12:40 made a lot of a lot of people a lot of
12:42 money eventually people did adopt the
12:44 internet uh and that made a lot of
12:46 people a lot of money so the same is
12:48 true on bitcoin bitcoin’s fundamentals
12:50 are the most solid investment of
12:53 anything I’ve ever owned and every time
12:56 I use it I research it which is
12:57 constantly I spend you know hours every
12:59 single day reading about researching and
13:02 following Bitcoin bitcoin news Bitcoin
13:04 research Bitcoin you know technological
13:07 developments and every aspect of that
13:11 leads me to conclude the same thing
13:12 which is the underlying investment is
13:15 Rock Solid because of the fundamentals
13:17 and if the fundamentals are solid then
13:19 does it really matter that the price has
13:21 been mostly sideways for the last five
13:23 months and the answer is no I mean I
13:25 would love it to be higher because then
13:27 everything I buy with my coinbase debit
13:29 cards even cheaper as compared to the
13:31 price I paid for the you know the
13:33 original Bitcoin um but you know what
13:36 I’m always buying more Bitcoin too so
13:38 I’ve got direct deposit you know all of
13:40 my income streams de direct deposit to
13:42 coinbase and are autoc converted into
13:44 Bitcoin so if the price is cheap one day
13:46 well guess what if I get a you know
13:48 direct deposit that day I’m buying
13:50 cheaper Bitcoin so so let me recap here
13:54 uh the recap is money is an important
13:56 technology politicians are not going to
13:58 solve that problem uh we’re not going
14:00 back to Gold we are going to use a
14:03 Digital hard money in the future nothing
14:06 is going to replace Bitcoin for all of
14:09 the things I’ve covered in previous
14:10 videos about you know if you try to
14:12 improve on Bitcoin in some way you have
14:14 to make it worse in some other way and
14:16 Bitcoin chose to be the most secure the
14:17 most decentralized uh digital asset and
14:21 for the base layer of the monetary
14:22 system uh those are characteristics that
14:25 cannot be improved upon uh without
14:27 making a sacrifice that uh people are
14:29 unwilling to make so for all those
14:32 reasons I think Bitcoin is a fantastic
14:34 investment uh as with the previous video
14:36 and every video I ever do this is not
14:38 investment advice or accounting advice
14:40 or legal advice this is just my personal
14:42 opinion and uh anyway but I think
14:45 Bitcoin is a fantastic investment at
14:48 $57,000 per coin and frankly I think
14:50 it’s a fantastic investment at any price
14:53 under under $75,000 per coin and since
14:56 the price has never been above $75,000
14:59 per coin I don’t believe there’s been
15:01 any time in the last 16 years where
15:03 Bitcoin was not a great investment so uh
15:06 happy to answer any questions uh my
15:08 conviction um of of Bitcoin remains at
15:12 100 out of 100 all the news headlines
15:14 are positive uh with regard to bitcoin
15:17 and it is only a matter of time until
15:19 that is reflected in the price of
15:20 Bitcoin at which point everyone will
15:22 wish they had bought a whole lot more
15:24 which is what always happens as the
15:26 price goes up everyone wishes they had
15:27 bought more and that has been the
15:29 consistent theme for the last 16 years
15:32 so hopefully it all helps I’m here for
15:33 anything you need as always thanks and
15:35 have a great day