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Archive for March 2013

Should I invest in Bitcoin?

Recently there is an explosion in both Bitcoin price, and its adoption in the world & in Israel in particular.

A few have turned to me and asked what I think about the price, and whether they should invest.

A few disclaimers:

  1. I have recently joined Meni Rosenfeld as a partner in Bitcoil, the largest Israeli Bitcoin Exchange. So you could call me biased.
  2. Of course I hold some bitcoins, so I’m even more biased
  3. I am not an investment adviser … use your heads, do your homework, only invest what you can afford to lose

My answer would mostly be to:

  1. Refer them to the post I wrote about it two years ago, when it was 80 cents (It’s now $45).
  2. They have to make their own decisions.
  3. No, I won’t tell you how much I invested two years ago. And it does’t matter.
  4. What matters is how much I have riding on it now – personal past performance is irrelevant for investment decisions
  5. Personally I am invested in it, for the long term. I have a significant (>10%) of my total net worth in Bitcoins, and I won’t be selling most of them under $1000 a pop.
  6. That I personally believe we’ll reach $100 in 2013, and $1000+ in the next 3-5 years (but I don’t have a crystal ball).
  7. It’s a risky investment – it could all vanish instantly if “something bad happens” (e.g. government crackdown)
  8. Please don’t try to day-trade if that’s not your profession. If you want to buy, just buy and hold it long term.
  9. Mining is for hardware experts, not for everyone. If you’re not an expert, stay out, for your own good.

In the last two years that I’ve dealt with Bitcoin, I haven’t heard a single convincing argument why it would fail. I’ve seen countless positive examples of the kind of community that it creates, and I am convinced it will grow and dominate. IMHO, every person on earth should hold some percentage of his investment portfolio in Bitcoin … it can be 0.1%, 1%, 10% … whatever you’re comfortable with.

There will only be 21,000,000 Bitcoins in the world … ever. Grab yours while they’re cheap and only cost $45 a pop.


And please, remember – I am not an investment adviser. Do your own homework.

For those who shout Ponzi, please read the FAQ before posting.