Is Bitcoin Really a Billionaire Maker? There’s no question that Bitcoin has made many people millionaires over the past decade. But can it create billionaires? Some believe so, with soaring price predictions and sky-high hopes. Let’s explore what it would take to become a Bitcoin billionaire maker.
Bitcoin Price Predictions: A Glimpse at the Future
You’ve probably heard some pretty mind-boggling Bitcoin price predictions by now. From $1 million by 2030 to — wait for it — $49 million by 2045, according to MicroStrategy executive chairman Michael Saylor. If these guesses are right, long-term investors could make out like bandits.
- $1 million by 2030: A more conservative prediction that still promises huge returns.
- $49 million by 2045: Requires patience and a lot of upfront cash.
For reference, you’d need to own 20 Bitcoins to become a billionaire based on the $50 million forecast. At today’s price of around $50,000 per coin, that’s an initial investment of over $1 million. For most people, that’s not happening.
The ‘Triple Maxi’ Investment Thesis
If you’re not already a millionaire, you might have to get a little more creative in your quest for billionaire status through Bitcoin. Enter the “triple maxi” investment thesis: unrelenting belief in Bitcoin and breaking all the rules when it comes to investing.
What Is a Bitcoin Maxi?
Bitcoin maxis (short for maximalists) think all other digital currencies are trash. They put everything into Bitcoin because they believe in its long-term potential. And honestly, they’ve been right for most of the last 15 years — Bitcoin was the best-performing asset from 2011-2021 with annualized returns of about 230%.
From Maxi to Triple Maxi:
- Maxi: Put everything into Bitcoin.
- Double Maxi: Move all other financial assets into Bitcoin, and put as much of your earnings as possible into it.
- Triple Maxi: Go all-in on Bitcoin, take on debt to buy more, and move to a tax-friendly jurisdiction.
How Many Rules Are You Willing To Break?
Becoming a Bitcoin billionaire goes against many basic principles of investing. You’ll have to throw diversification out the window, along with debt elimination and many other fundamental investment strategies.
Risk Of A Concentrated Portfolio
Conventional wisdom in investing is to spread your money among different asset classes so that if one crashes, you don’t lose everything. Putting all your eggs in the Bitcoin basket is inherently risky.
Leveraging Debt For Investment
The triple maxi strategy also involves taking on new debt to buy more Bitcoin — which is the opposite of what you should do with personal debt like student loans, credit cards, and mortgages. This can juice returns but also amplifies risk.
The Verdict
Even if ultra-bullish price predictions come true, becoming a Bitcoin billionaire will be playing an extremely high-stakes game. It’s a dangerous path to wealth that flouts traditional investment rules. While I’m incredibly bullish on Bitcoin over the long run, I’m not about to bet my life savings on it.
Final Thoughts
Is Bitcoin really a billionaire maker? The potential is there, but so are the risks. If you’re going for it – do so with eyes wide open!
For most of us, the best way to grow our money is by adopting a balanced investment strategy. And if you’re hungry for even more opportunity, take a look at these top ten stock picks from The Motley Fool.
Stocks that could be worth your while in 2022 and beyond. Remember: financial success comes from making informed choices with diversified investments.