Bitcoin Hits an All-Time New High – Should You Buy or Wait?

On Wednesday, Bitcoin prices soared to hit a brand new record, reaching $66,390 for the first time ever, and it’s climbing. By the end of the day, it could hit the $67,000 mark, and beyond. This beats the last record of $64,899, which was set back in April 2021. This is a 3% gain.

Investors Have Been Waiting for This

Investors in Bitcoin have been waiting for this, but the question is this — Can the cryptocurrency sustain this? If it can, and it continues to rally as it had in Q4 in past years, we could see some pretty lofty prices appear. However, if people begin to sell thanks to these records, the higher predicted prices could take several months…or even years…to appear.

What are the experts saying? Well, Paul Tudor Jones, a billionaire investor, has said that Bitcoin has become his preferred hedge over gold. He appeared on “Squawk Box” on CNBC, and stated “Bitcoin would be a great hedge. Crypto would be a great hedge. There’s a plan in place for crypto and clearly it’s winning the race against gold at the moment … I would think that would also be in very good inflation hedge. It would be my preferred one over gold at the moment.”

In addition to rising Bitcoin prices, we are also seeing a rise in Ethereum, which crossed the $4,000 mark. The second-largest crypto in the world hasn’t hit its high price of $4,380 since May 2021.

Speculation is pretty hot right now, too, with Bitcoin futures also rising, including ProShares Bitcoin Strategy ETF, which rose almost 5% on Tuesday, which was its first day of trading.

Not Everyone is Impressed by This

Though many people see this rise in price as a positive, not everyone is on board. There are several Bitcoin investors out there who want an ETF that doesn’t track futures but instead tracks spot prices. However, it seems that novice investors…a bit part of Bitcoin traders…don’t really understand all of this, so they don’t know what to do.

Regardless of this, the rise in price is, at the very least, a landmark for the crypto industry, which was really looking for some type of good news for the still struggling crypto market.

…But Should You Buy?

With Bitcoin prices rising, and many believing they will rise even further, should you start trading? Before you do, there are some things that you might want to keep in mind.

If you are looking for a long-term investment, realizing that it’s going to be a really rocky up and down road, yes, this might be a great time to invest in Bitcoin. However, if you are looking to get rich quick, you should reconsider. Yes, Bitcoin rose in price from $0 to $64,000 in only 10 years, you aren’t buying at the very lowest. In fact, it may be true that this is the highest it will get. Could it hit $500,000 as an all time high? Sure…but it could also fall right now. Bitcoin is not a typical investment, and you can lose everything just as quickly as you can gain.

Another thing to keep in mind is that trying to put a value on Bitcoin is pretty tricky. With stocks, we can look at a price-to-earnings ratio, which can tell you what people are willing to pay a company for each dollar of its earnings. This tells you if an investment is overvalued or undervalued. This is just impossible with Bitcoin. So, if you buy today, are you getting a good value or a bad one? Who knows?

All of this being said, it could be a mistake to ignore the fact that most cryptos are on the rise, and the temptation to buy is certainly there. It is probably a bad idea to do nothing, and at the very least, you should be watching.

Educate yourself as much as possible, and then determine if you have the money to invest. Just keep in mind, that this should be money that you can stand to lose. Selling your house and using the money to buy Bitcoin probably isn’t a great idea. Most experts recommend not putting more than 1% to 5% of your disposable income into investing.

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Author: Jason Donaldson