Please ensure Javascript is enabled for purposes of website accessibility

Is Bitcoin Going to Keep Moving Higher?

By Matthew Frankel, CFP® - Updated Jan 21, 2021 at 11:20AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Is it too late to get into bitcoin, or should investors add some to their portfolio?

Bitcoin has had a remarkable run over the past year or so. Even after a recent pullback, the leading cryptocurrency is still up by nearly 400% since the beginning of 2020.

Should investors buy more to benefit from even more potential upside? Or is bitcoin too volatile and too expensive to invest in? In this Jan. 11 Fool Live video clip, Fool.com contributor Matt Frankel, CFP, and Industry Focus: Financials host Jason Moser respond to a viewer's question about investing in bitcoin before its price stabilizes.

Matt Frankel: Let me read this one from Mary real quick. She said, "Matt, I didn't realize you had mined Bitcoin, new respect." Thanks, Mary. "If you wait until Bitcoin actually stabilizes, would that be too late to really profit in the game? Thanks."

First of all, when I mined, it was a fun experience. I bought some of the mining hardware and didn't just use my computer like you could back to the day, and a little thing called an AntMiner. I had another few that were just like little USB, things that plugged into a USB port. They were just like little computers. My power bill went through the roof a few months I was doing that.

Jason Moser: [laughs] I can imagine.

Frankel: Yeah, those suck a lot of power, all the mining hardware. I can just imagine that -- add five years of sophistication to that. I can imagine how much it sucks today. But waiting till Bitcoin stabilizes, yeah, it might be too late. For all we know, Bitcoin could stabilize at $100,000. I mean it's entirely possible. I don't think Bitcoin is an investment to chase profits. It's a speculative lottery ticket at this point. There are people who make solid cases that Bitcoin could go to zero eventually. There are people who make solid cases that Bitcoin could go to a million dollars eventually. It's very speculative right now. If you want to eventually use it as a store value or as a currency, then wait till it stabilizes. If you're planning to speculate on it and trying to make money, then buy some now, and hold on tight for a roller coaster ride.

Moser: Yeah.

Frankel: There is nothing wrong with doing that if know that's what you're getting into. There's nothing wrong with speculating a little bit if you know that you're buying a lottery ticket essentially. But if you want to use it, which it sounds like Mary likes the utility of it, then I would wait till it stabilizes before I bought some as a store of value or anything like that.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
316%
 
S&P 500 Returns
112%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 07/02/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.