2024 seemingly got off to a rocky start: after a long climb from a USD value of $16,000 in January of last year to nearly $46,000 during the first week of this year, Bitcoin experienced a precipitous drop, losing over ten percent of its value in USD terms in just over an hour.
Throughout its existence, Bitcoin has often been criticized for its ‘volatility’, with opponents using that volatility to stoke fears that Bitcoin could never be money, or even never retain value – an essential part of helping people save their way to a better future – for very long.
If you're hearing those choruses, and perhaps even somewhat lending credence to them, know that you're not alone. We’ve likely all been taken in by such shortsighted criticisms at some point during our Bitcoin journey.
In fact, for those of you who have joined the Bitcoin community in the last year or so, the ‘flash crash' we saw at the start of this year may be the first you've ever experienced. And if you've put some of your life savings into Bitcoin, seeing it shed ten percent of its worth in such a short amount of time can be nerve-wracking.
Reliving My Early Days
I’d like to think that I know how you feel. My first flash crash, or at least the first one I remember, was in March 2020 when, in reaction to the COVID-19 pandemic going global, Bitcoin lost over half of its USD-based value in less than a day. At that point, I myself was still relatively new to Bitcoin, so I was extremely concerned to say the least.
In the years since that day, I've seen Bitcoin’s value jump and drop by huge amounts many times. In a number of ways, it's become easier for me to deal with that volatility, especially as I've grown to understand Bitcoin's true potential: Bitcoin is not a new type of investment vehicle, to be lambasted if it doesn't cater to every whim of Wall Street. It also isn't a fad destined to pass us by and cease to exist in a few years. Rather, Bitcoin is a new way (and, actually, the only true way) of doing money and finance that finally puts us fully in control of our lives and our livelihoods.
With that deeper understanding always present in my mind, getting through the ups and downs of Bitcoin is nowhere near as hard as it used to be. Perhaps that knowledge can be of some assistance to you as well.
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