Bitcoin is a digital currency and has recently doubled in price. But before trying to buy some, buyer beware.
Bitcoin is red hot. This digital world currently ran up from $20,000 in December 2020 to $40,000 by Jan. 10, 2021–making big money for investors.
But it then dropped by 20%, burning investors who arrived late to the party.
Fortune Magazine says Bitcoin is a bubble that has popped several times. Most recently, in March 2020 when bitcoin plunged 60%.
CNBC’s Jim Cramer says it can be part of investments, and says he owns some.
But he says only play what you can afford to lose, just like in a casino.
But from the “doesn’t that stink” file, what can happen when a bubble bursts? Most younger investors may not remember the 1999.com bubble when any stock with a “dot com” at the end doubled in days.
It all crashed in the “dot com” bust and late investors lost fortunes. The poster child was “Pets.com”
Bank of America calls Bitcoin, “the mother of all bubbles,” so invest accordingly.
It’s not a scam, and you could make big money…but you could lose big money, too.
Could Bitcoin soon double or triple again? Sure, but it could also plunge like it has several times before. So be careful, and don’t waste your money.