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Americans Don’t Understand Bitcoin’s Value, That’s Why Bitcoin Poised To Explode

July 30, 2019
Devin Milford


Americans Don’t Understand Bitcoin’s Value, That’s Why Bitcoin Poised To Explode

Westerners, and Americans especially, just don’t “get” bitcoin.

That’s why lots of investors are missing the boat on just why bitcoin is so useful to an investment portfolio. When that understanding grows, the demand for bitcoin could explode, certainly dwarfing the current levels of interest.

I’m no investment professional, just a lawyer whose opinions are merely opinions of my own. But it’s said that diversification helps investment portfolios hedge risk and enhance return.

If that saying is true, then one value of bitcoin is its role in diversifying that portfolio.

But why does bitcoin add that diversity?

There are several reasons. It is becoming primarily a store of value (most bitcoin never move and are hoarded by owners) and acts as a hedge against inflationary pressures. This is recognized most by people in lesser-developed countries whose governments are most prone to inflating their fiat currencies, but in the West, expanding social service safety nets and political pressures may convince leaders to (oxymoron alert) print their way out of debt.

However, there are other reasons. Bitcoin is a tool for privacy. As the world economy moves away from a manufacturing-based orientation and increasingly towards a data-oriented one, people will start rejecting companies which suffer data breaches or exploit customer information (Facebook, we’re looking at you). Bitcoin and crypto are becoming a hedge against today’s Big Tech leaders (the “FAANG” quintet of Facebook, Alibaba, Amazon, Netflix and Google).

Last but not least, bitcoin is understood as having a value independent from the imputed trust which Westerners place (mistakenly) in institutions. Gullible Westerners trust big institutions and have done so at their peril. Inhabitants of underdeveloped countries, growing up in societies where often every institution of consequence is considered corrupt to its core, see the value of bitcoin much more viscerally than naive Westerners. The non-Western market is huge, it is still almost totally virgin territory, and it can transform the world.

The result is that bitcoin gives investors an exposure to these sectors and world influences which cannot be achieved as efficiently or safely by any other alternative means. If you’re curious about crypto as the investment, this is the most compelling reason to get into bitcoin and stay invested.