Introduction.

We have come a long way since the publication of the whitepaper 'Bitcoin: A Peer-to-Peer Electronic Cash System' by Satoshi Nakamoto.

The year 2020 was an important year, bringing Bitcoin spot on the radar of big money players like Wall Street veterans, Treasuries of Publicly Traded Companies and Institutional investors. All have decided to allocate some of their wealth in the new decentralized monetary system, understanding that the current financial fiat system is under immense pressure, with printing presses unloading trillions of USD and Euro's into the global economy. In a push to alleviate some wealth into reserve assets, as a hedge against the now much feared inflation, not only gold and silver will flourish, but also Bitcoin and soon Ethereum.

Bitcoin maximalists might not love it, however, this big money is needed to further expand Bitcoin as a successful asset class. Those big players couldn't invest before a futures market offered extra on- and off-ramps. These types of investors demand much more liquidity, now provided by a growing futures and derivatives market, as well as market makers.

Let's take a look at the big spenders: (full list)

The CEO of Microstrategy Inc (NADQ:MSTR), Michael Saylor, was the most prominent vocal coach for Bitcoin during 2020, and invested 1,125 billion USD into the asset, now owning 70,470 BTC. The number 2 Bitcoin Treasury is Galaxy Digital Holdings (TSE:GLXY), founded by CEO Mike Novogratz, hodling 16,402 Bitcoin. The top 3 ends with no other than Jack Dorsey's Square Inc's (NADX:SQ) Treasury which amounts to 4,709 Bitcoin.

Since an official Bitcoin ETF hasn't been approved yet, these ETF like Bitcoin Trusts offer exposure to Bitcoin:

Most known is the Grayscale Bitcoin Trust (OTCQX:GBTC), holding an astonishing 572,644 BTC, followed by CoinShares / XBT Provider (COINXBT:SS) with an amount of 69,730 BTC. The list closes with a total of 33 Trusts, which is an explosions compared to the shortlist one year ago. Taking in account that Grayscale scoops up every single newly produced Bitcoin, Bitcoin will become harder and harder as a reserve asset.

Why you shouldn't sell!

1. Plan B.

Plan B's 2019 Stock to Flow model, described in his brilliant research paper, "The “Plan B” – Model: The Holy Grail of Bitcoin Valuation?", clearly describes the road ahead. The stock of Bitcoin always remains at 21,000,000 Bitcoin, while the flow goes down significantly every halving. This makes Bitcoin the perfect digital form of gold, yet even harder as gold because the gold reserves aren't capped at a maximum and new gold can always be found. Therefor, the traditional commodities' Stock to Flow model could be used for a Bitcoin analysis.

Conclusion: The Stock to Flow model shows a significant higher price for Bitcoin over time.

2. QE continues.

Since 2008, the world has been trying to come to terms with quantitative easing, a financial theory or at best 'an experiment gone wrong' that seems to claim that you can print wealth without economic growth. Any student of monetary history understands that when the overall supply of any asset is inflated the value per unit will mathematically come down eventually, and the smart money has figured out the inevitable outcome: a sharp devaluation of fiat currencies that experiment with this theory. Covid-19-20-21 pushes global governments into the corner and they will create more stimulus going forward.

3. Covid just got more dangerous.

The new variant of the virus is 70 times more contagious, which is a reason to argue that this year will not be a great year at all, despite the mania about the vaccinations. It will take the most of the year 2021 to vaccinate the world's population in an attempt to reach herd immunity: the World Health Organization estimates that up to 70% of a given population must be vaccinated to halt the spread of disease. Unfortunately, herd immunity is NOT guaranteed and we will continue to need practicing and promoting safety guidelines that can actually contain the disease. More lock-downs will be implemented amidst populations that lose their grip and suffer from fatigue with regards to social distancing and other necessary rules.

Conclusion.

For a relative newcomer the volatility in the crypto market may proof to be too much. You definitely need a strong digestive system, or otherwise you won't get much sleep at night and spend many hours with nervous stomach pains.

A good strategy is to dollar cost average, picking a certain amount of Bitcoin up every month or so, that way the volatility risks are sharply reduced. Don't become one of the 90% losing traders. Bitcoin is not the asset to speculate on, and you're not the best speculator are you? So don't use any leveraged products to lambo anytime soon. Be patient.

Read the Bitcoin whitepaper, read about Bretton Woods, learn more about gold and gold standards, the history of money, the 1930's depression, inflation, stagflation,... you WILL have the time to do this. Doing so will give you a deeper understanding of the current paradigm shift and wealth transfer that is upon us.

Good people to listen to are: Willem Middelkoop's Big Reset, Mike Maloney's youtube series: "The hidden secrets of money."

I really strongly recommend to learn about money, if not you will one day wake up in a new world, not able to figure out why you didn't listen to my advice and invest in your free education.

Disclaimer.

This article is not financial advice, the best advice I can give you is to educate yourself. Never do silly things like selling stuff to buy Bitcoin, experiment with leveraged trading, or take out a loan to invest in anything. Never invest more than you can afford to lose. If you need advice on what to buy it only proves one thing: learn faster! And one golden rule: "Not you private keys, not your Bitcoin".