Should You Invest in Bitcoin at $40,000?

Alright, so I just ran the numbers today. If you had gone back 10 years ago and put $1,000 into Bitcoin today, it would be worth. Is that a billion one? It would be worth over $100 million right now.

And you know, that's alright, that's okay because sometimes in life you're gonna start slow. That's okay. We told ourselves, hey, we're gonna start slow. We're go going fast, we're going to start slow, but we're always, always going to finish fast.

Bitcoin's at record highs again. But the real question is, what do you do now? Should you buy bitcoin today now that it's at record highs? That's what we're going to talk about in today's video.

Well, Bitcoin, I owe you an apology. I have been way too hard on you over the years. For many years I've been down on bitcoin because in my opinion, it wasn't back by anything. And I didn't see the utility for it. And I just saw it as a big pump of people who wanted to speculate on something that could go up in price. Excellent choice, Kevin. Let me lock in that trade right now and get back to you in a few minutes with an exact confirmation. I've come full circle on this. The events of 2020 in particular to me were very revealing that there is utility and there is a need for a more decentralized currency. So specifically what I'm referencing is the activity of the Federal Reserve and the United States government and their propensity to just throw money at everything. So from a philosophical standpoint, I now understand the benefit and the need for something like a bitcoin. And of course, like all of us, I am going back and looking at if I had bought it at this price and put this much money in, I would have made a kabillion dollars. But since none of that is really helpful, the real question is, should you buy it now, now that it has increased in price and that a lot of people are starting to see that there is utility and upside to bitcoin and other cryptocurrencies. Should you put your money in now? But here is the thing that most people are not talking about in the whole context of the cryptocurrency boom. Bitcoin has gone up about 10x in the last year. That's impressive. It's really impressive. But do you know what else has gone up 10x in the last year? Square stock, Wayfair stock, Carvana stock, Tesla stock. There's a myriad of different investments that have gone up just as much as bitcoin in the last year, two years, three years. But they're not getting the attention that something like a bitcoin is getting. And yes, there is an argument to be said around some of those companies now have holdings in bitcoin, so they're all going up together. That's a very fair argument. But there is always opportunity. No matter what the market is doing. Regardless of where bitcoin is or where the Dow Jones Industrial Average is, there are always opportunities. And it's a mistake to pick an investment just because you are afraid that it's going to go up even further. What that is usually a sign of is the desire to not feel stupid. Let's get this out into the open. I feel stupid for not buying Bitcoin Much earlier I had a friend who put together a fund to just buy bitcoin. But when it was at $500 I had him on my podcast and I basically said, this is silly. Why are you doing this? He's done better than me over the last couple of years. So I feel stupid for not heeding my friend's advice when bitcoin was at 500. I feel stupid for not buying Bitcoin when it dipped during the COVID plunge. I feel stupid for not buying Bitcoin when it hit 10,000. I feel stupid for for all of these reasons. But it would be equally stupid to buy Bitcoin for the fear of not feeling stupid in the future. Because I could do that with any investment. I could say I feel stupid for not buying Square stock when it IPO'd. I feel stupid for not buying more houses in Austin, Texas when I bought this one. We can all play that game and it doesn't serve us. So there's this sense of I feel stupid for not buying it in the past, so I should buy it now so that I don't feel more stupid in the future. That is not an investing strategy. In order to decide whether or not you should buy Bitcoin or any investment, there's a couple other more helpful questions that will lead you to the best decision. Number one, do you have a business that is spitting off cash? Because the way to wealth is two steps. Build a business and invest the profits. It's fun to talk about the speculative investments that you make with your side cash, but all of your wealth happens in the build a business piece. It's at least the nucleus. It's at least the thing that makes everything else possible. So if you're not at least putting your attention and your money into the business that you're building, well then it's really hard to become a good investor because you don't have the extra cash to put into the investments that make you rich. So that's the first question. Are you building a business that is profitable enough for you to be able to speculate or waste money on something that may go up or down in value? The second question is, do you have a base of passive income that can start to support your lifestyle? Do you have a nice base of dividend paying stocks of other assets that are paying you monthly or quarterly or at least yearly to be able to support your lifestyle? Because otherwise, if you are only betting on something going further up in value, then you're going to be really tense with that money. That's why I suggest that you have both the business and some passive income so that you've got the cash flow for you to relax and that helps you make up for any mistakes that you might make as a speculator. For example, on the side, I day trade, I like to buy and sell options and I'm starting to get a little bit good at it and I have a lot of fun and it's also probably not the best use of my time, but I enjoy it and I like getting better at it and it's something I've always wanted to be good at. But if I was dependent upon that money because I didn't have other businesses and other sources of passive income, then I would be a terrible trader because I'd be tense all the time. I would be unable to make good, calm, calculated decisions. And so as you're looking at buying Bitcoin or any other speculative asset or investment, are you going to be able to go into that with a calm mind? Are you going to be able to withstand the fluctuations in price or are you just betting on it because you're confident that it's going to go up in value? In my opinion, that's a bad reason to buy Bitcoin. Now I've been convinced by a lot of my friends that Bitcoin is going to continue to go up in value. And who knows, maybe those who said it would go to a million dollars were right. I can actually see that happening over the next few years. But you know what else? Tesla could boom. Square stock could take over the world. Nio, the Chinese electric car company could become the next trillion dollar player. All of these things are possible. There's pathways to all of them happening. The question is really where do you have a strategic advantage or do you have a head start compared to the rest of the marketplace? Consider this for example. I had my biggest financial win, at least up to that point when I built a E Commerce brand that took about 60% of its sales on Amazon.com and that business was profiting about $3 million a year. And I sold that for an eight figure payday. And that's the foundation of what I teach inside of our trainings@sideofcapitalism.com I was an early player to that game. I also had 10 years of marketing and business experience that made me really good at seeing types of opportunities. So I had a stack deck going into that and it gives me an even further stack deck to help other entrepreneurs build businesses. I don't have that same lens with cryptocurrency. I don't have that same strategic advantage. I don't have a knowledge gap where I am strategically better than everybody else. So I can't predict with reasonable certainty that Bitcoin is going to go to 100,000 or a million. I'm speculating. I'm not investing. Yes, I have completely missed out on literally millions of dollars. I wish that I had had the foresight to buy Bitcoin at $500 or at least during the COVID plunge when it was trading below 5,000. I wish I had, but I didn't know because I didn't have the knowledge to know what was going to happen there. Yes, I beat myself up over it sometimes. Yes, I have run the numbers and lost sleep running the numbers. But I didn't know because it's not the business that I'm in now. Compare that to a conversation that I had yesterday with actually one of my students who is building an E Commerce brand that I love in a sector that I know very well with a strategy that I'm able to advise on and me coming into that business, I'm able to provide a lot of value and help that business grow. And I happen to have capital because I run a fund for e Commerce brands and I can take some of that money and invest it in this business. And I'm very confident that with my money, with my advice and this business, I can turn that into something that is very financially rewarding. I have a very high confidence interval based on my own experience, my unique knowledge, my unique talents, my unique network of people that I can add value to that and make a lot of money. I don't have that with Bitcoin. So if you are one of those people who has been extremely well educated on this topic. And you have a business that is producing profits and you have a base of passive income and you feel like you have a strategic advantage knowing that what is going on with these different coins and different businesses that are built on the back of these platforms, then you could make an educated decision to invest in Bitcoin or other cryptocurrencies. I personally can't because that would be speculating. Here's the asterisks. If you are willing to lose 5 to 10% of your portfolio by putting it into a speculative investment, go for it, have fun with it, enjoy it. As long as you're willing to lose that money, of course. I have to say reminder. I'm an idiot on the Internet who admittedly made a bunch of mistakes by not investing in cryptocurrency and am not a financial advisor and clearly have no idea what I'm talking about. So don't take my advice as anything other than entertainment purposes only. There's one really important thing that I want you to take away from this. There is a chance that Bitcoin goes up 10x more than where it is right now. But here's the thing. So will other investments in that time frame. Whether it's cryptocurrencies or penny stocks or real estate in the right area or the right stock, there are other assets, there are other investments that will go up just as much as Bitcoin. So with that in mind, do you take the bet on this one investment or do you become so good at one skill set and one area of expertise that you can see them ahead of time, that you can see the winners before everybody else does? Because that is real investing. And that's where you can get deliriously rich by having that type of a strategic advantage ahead of everybody else. And in my opinion, the best way to do that is to build a business first. And that gives you a lens to see which businesses and which opportunities are ahead of the curve compared to everybody else. And that gives you the ability to invest in things that will make you very rich. My name's Ryan Daniel Moran. My business is capitalism.com and the best investment that you can make is clicking the like button on this video and subscribing to the channel. Of course, my business is investing in entrepreneurs and helping them build seven figure businesses that they can sell. And so if you're one of those people, subscribe to the channel. And if you want to get plugged into what we do here, you can download our free resources or@capitalism.com start hey, thanks for watching this video. I feel stupid for not buying Bitcoin too. I But remember, the opportunity of a lifetime happens about every six months. So if you missed this one, relax. There are always opportunities in every market. And as an entrepreneur and as a capitalist, your job is to look for those opportunities. Not the opportunities that you wish you had bought, not the opportunities that you feel stupid for not buying, but the opportunities that are coming next. And that comes by you knowing something so well that you're ahead of everybody else. That's our job as capitalists. Thanks for watching this video. I'll see you guys next time.