Bitcoin wants to give the power back to the people. Beyond that, a calculated investment in Bitcoin has the potential to bring one closer to financial freedom. But how can anyone do that?
For the past 14 years, investors have been attracted to Bitcoin
BTC is the source
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$22,327 cash
for various reasons — from potential solutions to the financial problems of the current fiat economic system to unbanked and diversified portfolios. However, a large portion of the public sees Bitcoin as a gateway to financial freedom amid rising fiat inflation and geopolitical uncertainty.
The traditional banking system has always functioned as a tool for centralized governments to manage revenues, especially in emergencies. More recently, the Ukraine-Russia conflict serves as a case study of how cryptocurrencies help the displaced and unbanked access funds for basic needs.
Inspired by founder Satoshi Nakamoto, Bitcoin seeks to give power back to the people. No amount of laws, restrictions or restrictions can prevent people from using Bitcoin as a currency. Beyond that, a calculated investment in Bitcoin has the potential to bring people closer to achieving their dream of financial freedom. But how can people achieve it?
Hodl
The high volatility of cryptocurrencies combined with investor jitters is a recipe for instant losses. Many do not understand that Bitcoin — unlike other cryptocurrencies — is a long-term investment. Therefore, Bitcoin veterans recommend holding assets in bull markets and buying dips in bear markets.
According to data from UpMyInterest, excluding some off-years, Bitcoin holders saw an average annual return of 93.8%, which in the best performing year, rose to 302.8%.
As simple as it sounds, holding (crypto lingo for holding an asset) has proven difficult for investors. Some of the factors that trigger sudden Bitcoin purchases are the spread of FUD (fear, uncertainty and doubt) and price movements.
While it makes short-term sense to profit from Bitcoin’s volatility, the widening of the price chart indicates a larger long-term boost in holdings. Additionally, investors with Bitcoin will always have the option to use these expenses across geographic boundaries without losing value.
Dollar cost averaging
Considering Bitcoin as a solid long-term investment option, many investors choose a dollar cost averaging (DCA) strategy. This involves setting aside a predetermined dollar amount of an individual currency to be reinvested in Bitcoin on a daily, weekly or monthly basis.
El Salvador was initially criticized for using Bitcoin as a payment method, saying that amid crippling inflation, the country could recycle unrealized profits to finance social projects, such as building hospitals and schools.
When the Bitcoin bull run ends by 2022, Salvadoran President Nayib Bukele is pursuing a strategy similar to DCA, where the country will buy 1 BTC per day.
When Bukele announced his intention to buy Bitcoin, it was worth about $16,600, according to data from Cointelegraph Markets Pro and TradingView.
Since then, the price of BTC has risen 40.46%, providing much-needed relief to the people of Salvador. Investors seeking financial freedom must follow a similar strategy in response to market volatility and public sentiment.
Take care
When it comes to long-term Bitcoin holdings, the key is not to trust a third-party entity with the asset’s private key. Investors who store Bitcoins on crypto exchanges unknowingly give up complete control over their assets.
Since the FTX scam came to light, the case for self-protection has become stronger. Investors who have suffered losses from financial mismanagement have realized the importance of taking care of themselves. Maintaining ownership of private keys — through self-protected wallets — is becoming increasingly important for those seeking true financial freedom.
While hardware alternatives for crypto self-custody require an initial investment, it is up to the user to choose an appropriate method to store the private key, say recording the private key on a piece of paper
