Mark Tencaten - Is Investing in Bitcoin safe?

Following a disastrous 2022, Bitcoin (BTC) has slightly increased this year. According to Mark Tencaten, the cryptocurrency began in 2023 at about $16,500 before growing to about $23,000. Although it has since decreased a little and is far from its record high of over $68,000, it has still increased by about 40% in just five weeks.

Some people interpret the rally as a cause for optimism and the possibility that the crypto winter may finally be ending. The gold rise has been covered from being recognized thanks to the Bitcoin rally. The real rally occurring in actual gold is going unnoticed by the financial media because it is preoccupied with the sucker's rally occurring in actual gold.

Why Bitcoin’s rally is considered a sucker’s rally?

The primary criticism of Bitcoin is that it is pointless. People contend that Bitcoin is only a string of numbers, unlike gold, which he says is a hedge towards inflation and can potentially be used in jewelry, at the very least. Given that they don't believe that the Fed will be able to regulate inflation, they believe that gold is preferable to money.

People claimed in 2021 that Bitcoin is not a currency because it isn't truly used as a means of exchange or a unit of account. It is just used for speculation but it is not an investment commodity like real estate, will not really pay rent, is not a stock, doesn't pay dividends, is not a bond, and doesn't pay interest.

They believe that the two market rallies are being driven by various reasons. Bitcoin has increased on expectations that a number of speculative assets will rebound now that the Federal Reserve is easing its tightening policies and slowing interest rate increases. These speculative assets suffered big losses last year. Contrarily, people began purchasing gold because it serves as a hedge against both inflation and a prospective decline in the value of the dollar.

Is the perspective about Bitcoin correct?

Investment choices don't always have to be binary choices. Building a diverse portfolio of high-quality assets that you think will perform well over the long term depends on the type of trader you are. Therefore, if you think both Bitcoin and gold could be valuable, you might own them both.

A Bloomberg article claims that part of the reason for the equities and cryptocurrency rallies is "wishful thinking floating that the inflation demon has been slain.”  It is unlikely that the Fed will stop tightening the economy until it is certain that inflation is now under control. Some specialists believe that we still have a lot of inflation issues.

A recession may also be on the horizon, according to many economists. The future of the economy and its potential effects on risky assets like cryptocurrency is quite unpredictable. Additionally, we are unsure of the effects that tighter regulation of the cryptocurrency industry will have or whether the current repercussions from FTX will cause any other platforms to fail. Another reason to exercise care is the reality that Bitcoin continues to be a long way from recovering its losses from the previous year.

Many Bitcoin supporters disagree, like Mark Tencaten, who highlights the currency's potential in emerging nations and potential use in the global remittance sector, among other things.

Conclusion

When deciding whether to purchase Bitcoin, gold or any other investment, Mark Tencaten advises considering the basics as well as how it may perform in the future and fit into your portfolio. It doesn't really matter whether this rally is brief or not, in a manner. What counts is if Bitcoin can get over the obstacles in its way and outperform other assets over the course of the next ten years or more.

A high-risk investment is a cryptocurrency. This does imply the possibility of substantial rewards, but you also run the risk of losing a lot. Mark Tencaten says that there is a certainty that Bitcoin will do what its supporters hope it will. If you're thinking about investing, be sure you're aware of the risks, choose a trustworthy cryptocurrency exchange, and only invest money you can risk losing.