My Long-Term Investment Case for Bitcoin

I believe that bitcoin will appreciate in the coming years as I expect that the demand for bitcoin will increase due to two main reasons:

1. Bitcoin becoming a global reserve currency; a borderless and neutral alternative to national currencies.
2. The U.S. dollar falling in value as the U.S. debt overhang is too high for the debt to ever be repaid, without letting inflation eat away the real value first, and investors will allocate to bitcoin as a liquid non-inflationary asset.

When should you buy bitcoin?

Fundamentally, there are only two situations in which you should buy bitcoin:

1. If you believe that bitcoin will appreciate over time.
2. If you believe that you may want access to the unique capabilities of bitcoin at some point in the future, and that there is a risk that you will not be able to buy bitcoin when you need it.

You don’t have to be certain of either of the points above as investing is all about probabilities, expected value, and uncertainties. You also don’t have to invest all your money or none. For most, a small allocation is what would be sensible.

To identify whether buying bitcoin is right for you or not, you need to figure out your expectations for bitcoin’s future price movement and the utilities you potentially could derive from owning it yourself.

There are already hundreds of millions of people all over the world who have decided that bitcoin is right for them. All of them, presumably, expect that bitcoin will appreciate over time and/or believe that they will need to leverage the unique features of bitcoin at some point in their lives. The different reasons for these views are as many as there are owners of bitcoin.

Why I believe that bitcoin will appreciate

Over the coming years I see a lot of different triggers that could drive up the price of bitcoin, including:

• The halving of the bitcoin production rate in April 2024.
• Increased inflows to bitcoin ETFs as the big players on Wall Street start marketing their products
• Increased demand following from the continuous wealth transfer to the younger generation, who are more inclined to invest in bitcoin.

These triggers, however, can only explain changes in demand, given that there already is demand. If there were no other drivers, the value of bitcoin would be fragile as it would only rest on the shared illusion that it has…