Bitcoin Nears $17K: Why I FINALLY invested in Cryptocurrency (What happened?!)

What's up you guys? It's Graham here. So, the comments of my Bitcoin video finally got to me. People were calling me worthless because I wasn't buying Bitcoin and investing in cryptocurrency. They said I was clueless. They told me to go educate myself. They said I was gonna be left behind and die. And I read every single comment.

I've also had people pouring in my email, my Snapchats, my Instagram DMs telling me to invest in crypto and giving me tips and tricks of what they've learned. So, what changed? And what did I finally decide to invest in cryptocurrency after watching for such a long time? So, as a background here, I started by trading Bitcoin swings, and wow was this easy.

In a few minutes, I was up over five hundred dollars in Bitcoin in just a matter of minutes. And then I sold and I locked in my profits. I thought to myself, "You know what? This is really easy. Let me do it again." And then I tried doing it again, and a whale just came in and sold a whole bunch, and the whole thing just plummeted right after I bought. I lost that profit.

Since then I've made quite a significant profit over the last few days, especially with Litecoin. I'll be honest with you here, the return I made in the last few days on Litecoin and Bitcoin have made my real estate return look like peanuts compared to the return that I got in Litecoin alone. But I'm not celebrating quite yet.

So here's why I decided to invest in cryptocurrency and my thought going forward. Now, this is coming from somebody who is extremely conservative with their investments. Since it became evident to me that regardless of what happens with these crazy price fluctuations, and whether or not we're in this massive hype of a bubble or not, cryptocurrency is most likely here to stay for the long term.

To me, it's received enough media attention and adoption that even if it were to drop 90% tomorrow, it still has enough functionality and utility to continue to grow and develop over the long term. So, I thought to myself, "You know what? Why not? Let's try this out, give it a shot and see what happens."

I wanted to get a first-hand experience of what it was actually like to buy, sell, and trade cryptocurrency. Just like in real estate, it's one thing to have a textbook knowledge of how it's done, to know investor psychology, to think, "What should happen and what's expected to happen?" But until you actually do it, you don't quite have the context behind it.

When investing in anything, I think context is key. So, you might initially think that I'm just flip-flopping on my opinions when it comes to cryptocurrency, following the herd and just following in as a sheep, but my goal in this is not to make mad profits, although that would be nice. Instead, I'm using this as just a first-hand experience of cryptocurrency in general. I'm using this like a crash course education in what cryptocurrency is all about, and really understanding it firsthand.

I'm doing all of this without the expectation of making a ton of money, similar to the personal trainer who gained a lot of weight just to lose it so he can better understand the struggles his clients have to go through. And now, after investing some money in crypto, that's what I get. I totally understand. I see what it's all about. I see why you guys are really into this.

And it's really fun! Like, I've been up until 3 a.m. multiple nights reading charts, going on forums, talking to you guys. It's a really fun community with a lot of people with similar goals and outlooks. And what I'd like most about this is that it never sleeps; it's 24/7. This is the way I think the stock market should be. There is no reason that the stock market shouldn't be trading during certain hours. Honestly, I agree with crypto; I think it should be 24/7.

And it's fun to wake up in the morning and see how much money you've just made. So, I get it. I also understand the appeal of getting in something before other people find out about it and being early to it. I understand why people haven't invested in this yet after going through what I went through in the beginning, just to start investing in Bitcoin and Litecoin.

It is so foreign to what most people are used to, with like a stock brokerage buying stocks and such like that. It's an entirely different animal. And I think this is gonna take a lot more time for it to become mainstream and stable enough for most people to want to invest in. With that said, I see this leaving a lot more room for growth and potential, but there's still a very big commonality right now between me and a lot of the other very conservative investors out there who have not bought Bitcoin or cryptocurrency yet and don't plan to, and that is value investing.

Like with my specialty in real estate investing, for example, I take into account how much do and is there, how much inventory is there, how much inventory can be built in this area, how much can I charge for rent, how much does it cost to recreate this same property, and people live in it. So, it has a direct utility and direct use. Same with investing in a stock or company; what do they produce? What are their earnings like? And how well valued are they in relation to that?

And this is the biggest difference I see with cryptocurrency. Now, even though I'm investing in it right now, I still can't justify the value at the time of making this video. I still can't understand why Bitcoin is nearly trading at $20,000 as opposed to $12,000, as opposed to $7,000, or as opposed to $13,000. In cryptocurrency, the way I see it is that the value is whatever we think it's going to be rather than on the fundamentals.

I also understand the value from a psychological standpoint. There are a lot of psychological barriers and resistance levels when it comes to Bitcoin that people assume it's going to hit, and therefore it hits. I get the future aspirations of this becoming more widely adopted and used, and the price going up further, but at the same time this isn't so much trading its use; it's trading speculation.

It's investing in cryptocurrency just with the expectation that it's going to be worth more in the future. But then we can also compare Bitcoin with just about every other market and say, in relation to this, it's undervalued. In relation to gold that has a market cap of $7.8 trillion, Bitcoin is undervalued in relation to how many people actually use it. Bitcoin is undervalued in relation to how many companies take it.

It's also undervalued. So, the mentality is if it's worth $17,000 now and not many people are using it, imagine what it's gonna be like when all these other people begin using Bitcoin. That could very well be true, but right now I still can't justify a nearly 100% price increase in the last two weeks based off functionality alone. And this could be true, but I can't see how functionality would lead to an increase of 100% in the last two weeks.

The functionality of Bitcoin didn't go up a hundred percent in two weeks, but media attention and excitement of future profits did. This isn't even to say that Bitcoin is the best coin. Honestly, I believe other coins have way more potential than Bitcoin, but Bitcoin remains the top dog in terms of popularity.

Even though other coins, in my opinion, have way more potential, and as of now just continues to go up, it would have been really hard to lose money in cryptocurrencies over the last few months or the last year, even a year and a half, unless you're buying ICOs during their pump-and-dump phase and then just dumping them and selling it at a loss. It would have been really hard to lose lately.

So, it makes sense that most investors now that have gotten in recently have only had experiences of it going up, up, up. Even if it goes up 20%, dips 10, up 30%, dips 5, up another 10%, they’ve had an experience where overall it just continues going higher and higher.

And right now, at current prices, I bet only a small percentage of them were investing in Bitcoin when it was trading at $300 a Bitcoin and not really doing anything. Most people, including myself, didn't see the value of it until it started getting a lot of media attention with crazy profits. Sure, there are people out there who have been real OGs and have held it for a while and have held it this entire time, but I bet that's a very small percentage that haven't taken profits along the way as it's been going up purely because of how volatile it is and because we don't know how high this is going to continue to pump and pump and pump even more.

It's really like the wild, wild west right now in terms of getting rich quick. And this is what I see being the real problem, especially in a market like this where everything just continues to go up and up and up and up. It's easy, it's fun, everyone is winning.

Then I get the type of person telling me, "Graham, I don't have the type of money to invest in real estate. I don't have enough money. We're making 8% a year in the stock market; is that gonna make any difference for me? But I have enough money to put in crypto where I could potentially make millions." So that's where I'm investing. And yeah, to be honest that could totally happen, but let's be real here, that is speculation, plain and simple.

But right now, this relies on people buying it higher than you did, expecting even more profits beyond that. And I generalize to say that most people investing in cryptocurrency right now are doing it purely out of speculation for quick profit. And it's extremely easy to fall into the emotions of investing when the price goes up so quickly. You get that rush; when the price drops you feel that sinking feeling in the pit of your stomach like, "What did I do? How far is this gonna go down? Did I just lose everything? Did I make the biggest mistake in my life?" And then it comes back up again.

It's very similar to gambling or penny stocks or anything of that nature with a lot of volatility. Believe me, I've done it all. I know exactly what it's like. I gambled a lot in Vegas. I played penny stocks before. I know exactly what it's like. And even as an experienced real estate investor who spent a lot of time researching cryptocurrency in the last few weeks, I have no idea what the price is gonna be tomorrow, next week, the month after. I have no clue.

All I know is that it's quite a big rush to see immediate profits with very little work involved and think, "You know what? This is amazing!" Now, while the general consensus is that we will hit psychological barriers like $20,000 by the end of the year, I believe it's going to continue to hit these numbers just based off investor expectation of it actually hitting those numbers.

But right now, and I hate to say it, I still can't see the fundamentals justifying the prices that we're seeing right now. And this is with me actually investing in it. This is with me making money in it so far. I'm sure if this continues, one day it will have the fundamentals to justify the prices that we're seeing now, if not higher.

But in order for this to sustain itself, we either need way more mainstream adoption or for people to continue buying it higher and higher and higher, just with the expectation that more people are going to be buying in because it's going higher and higher and higher. Like right now, I believe it's going to hit $20,000 by the end of this year, if not slightly more. The reason I say that is because investors expect it to hit $20,000, so that means that people are buying in now anything under $20,000 just because they believe it's going to hit $20,000.

And because of that belief, it's going to hit $20,000. This is the problem I see right now; at some point, this isn't gonna be able to sustain itself. At some point, whether or not this point is $20,000, $30,000, $50,000, $100,000, or a million, I can't see any fundamentals or use really justifying its price.

At this point, it's really just based on the value that people attribute to it. So, my biggest recommendation here from my experience is just invest what you can lose. I personally invest an amount where if it goes up five or ten times, it's not going to be life-changing money. If it drops, I don't really care either way, and I'll most likely continue putting some money in this and playing around with it and learning as much as I can.

I do have a very optimistic long-term outlook on cryptocurrency in general, whether or not it's Bitcoin or Litecoin or any of the other altcoins out there. But I'm really only putting money in this just for the fun of it, just because I can. It's not really gonna make a difference in my life either way, and I'm doing it really just to learn the markets and get some experience in this.

I'd probably recommend just taking small profits along the way as it continues to go up, just to be conservative just in case something happens if you can't afford to lose the money that you gained. But that's me just being more conservative than most people. After all, no one really knows what the future is gonna hold.

So like I said, I invested really just for education to see what it's about. I understand it; I totally get the appeal. I see what it's all about, but I still can't seem to justify what price it's at now and the value that it brings right now for its fundamental utility and for what you can actually do with it.

Oh, and then one last thing. Every video I made about not buying Bitcoin or crypto, it shoots up a hundred to a thousand percent. So now that they've finally made a video about actually investing in cryptocurrency, expect a huge correction any moment now after posting this just because that's my luck.

So as always, you guys, thank you so much for watching. I really appreciate it. If you're watching this and you haven't subscribed yet, make sure to click the subscribe button. Also, make sure to give this video a like, maybe to counteract some of the dislikes that I'm getting on this. We want a good like-to-dislike ratio if we can, so just make sure to hit the like button.

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I've read every single comment on my last Bitcoin video, every single one of them. I read them all. I do my research; I listen to you guys. So any comments you write down below, chances are I'm going to read it. I'll do my best to reply to as many people as I can. So that's it; thanks for watching and until next time!