This blog post is going to be different from my others so far. I’m going to talk about one of the newest get rich quick schemes on the planet.
Today I’m going to give my 2 cents on Bitcoin.
If you’ve listened to other episodes of the podcast you’ll know that I normally talk about business, about marketing and other things related. But today I wanted to give my two cents on what I think about Bitcoin.
Bitcoin has been around for years.. The price of Bitcoin was being discussed online for several years, long before your local News Websites, TV Networks and friends started talking about it.
When you see something on the Local T.V news, next to a story about a lost dog that was found trapped under a drain only to be rescued by the heroic fireman, you know it’s reached mass market penetration (and/or hysteria).
But whether Bitcoin is known or unknown doesn’t really change my opinion of it at all.
Bitcoin is good tech. The technology that exists and delivers Bitcoin and other Cryptocurrencies like Ethereum and others smart helpful technology. That is the positive that surrounds Bitcoin and the technology which is called blockchain. The blockchain/s will likely be further developed and used in a number of different industries.
Where Bitcoin has gone a little “mad” is the stories of people turning $1000 into $3,000,000. It makes the average person sit up and pay attention, because everyone wants to do that too!
Even over 2017, Bitcoin had a 1000% increase in it’s value which has made people wealthy just within the span of 12 months.
Now I know all this sounds great. And it is great. Congratulations to anyone who made money buying Bitcoin. I won’t go into the hassles around holding, keeping bitcoin. Or using it, or selling it… I don’t think I need to get into all that grey area to make my point.
A key fact I always keep in mind when hearing about different ways to invest and make money, and new business opportunities in general is that the the best investors and money managers in the world average about 20% a year or so..these people manage and invest amounts of tens of billions of dollars, and over 100 billion dollars. The people who are in charge of this are pretty smart cookies obviously. I’m talking about Ray Dalio, Warren Buffett, etc.
They know the risks, they’ve played the game for years.. And none of them touch Bitcoin.
Because they know that they will have a better outcome risking as little as possible and earning 20%. Rather than risking a lot or everything, and possibly getting nothing in return.
They have simply looked at the odds.
It’s kind of like a horse race where the favorite horse most likely to win will pay you back $1.10 if you bet $1.00 on it to win. It’s so likely to win that the bookmakers in charge of the bets are not wanting to give you too much money for betting on that horse. Because they know, most likely they are going to lose that bet. So they give you less of a return. Yes, it’s really that simple.
By the way, let me say right here that this is not investment advice. Nothing in this episode or on the Quick Marketing Trick Podcast or website is investment advice.. Ever.
Still using the horse race example: in the same horse race, there is the horse that is LEAST likely to win. The person in charge of the gambling, tries to entice you to bet your money on that horse, he says if you bet $1 on THAT horse and it wins, i’ll give you $57. The bookmaker knows there is very little chance that horse will win, so he advertises a bigger pay off for you.
If you want to bet at all, you now have to decide are you willing to lose money for more of a risk? Or have a bigger chance to win a little, by taking a smaller risk.
This is what the biggest money managers (investors) across the globe do, and they average out at about 20% each year. They don’t put their money in a savings account that gets 3% interest back every year, because that’s easy and doesn’t give them the good return they need to get them and their clients excited. A savings account would be like betting $1 on the horse that will only give you $1.10 back if it wins.
These money managers also don’t risk their money on things like Bitcoin. Even though they could get a 1,000% return. “Could” is the key word there. They balance all their investments out. They balance their risks with the range of bets that are available within their range.
They look at all the horses and say ok here is a few that I will bet on, and here is the different amounts I will bet on each horse. Based on this, I know I have a likely chance of getting back $1.20 for my $1.
And the reason they are the best is because they do this every day. They come out the other end at about 20% in front on average at the end of every year. Sometimes less, sometimes more.
Bitcoin has never ran a race before. There is no way of knowing how that horse is going to go. No one does, because it’s never happened before. It’s never been through a cycle.
Would you bet on a horse that has never ran a race before? Or would you bet on the horse that has ran 100 races, and has won 50 of them, and has come 2nd or 3rd another 45 times?
Which horse is getting your money?
That’s how I look at my investments and my money too. Bitcoin doesn’t have any of my money. And while sometimes I think “oh it will be fun to buy $10,000 worth and just have it for fun, “see how it goes…”, I’m only human and I’m a simple one at that – I get these high risk urges too.
But I come back to my senses and continue to funnel my investments into smarter and more proven avenues.
Bitcoin is 100% outside of my control, and your control.
At any point, the Australian government and other governments across the world could outlaw it. And then just like that, it’s worth nothing.
Even when you invest in a house or apartment, that’s widely considered a safe bet. Most people will do it. But it’s still partly outside of your control.
You can’t control if more people are going to want to move to your area and therefore increase the value of your home. Or if people move away from your suburb because of some new highway, or government incentive, and therefore the value of your house decreases. But the large majority of people would agree that a home is a good investment.
So why Bitcoin? it makes no sense.
So what can you control? You can control your business and you can control what you sell. If your customers don’t buy what you’re selling: no worries. You’re not locked into that. You can change what you sell. If your product becomes illegal, like Bitcoin could become if the Australian government was to outlaw it.. You can just change your product and start selling something else. Isn’t that easy?
I always think as business as a safe haven.. Because you don’t have to sell the same thing every day. You can change it just as quick as your customers taste changes. You’re not restricted by what and how you sell it (as long as it’s legal of course).
In my company, I help businesses in Australia get more customers. So is it safe to say that companies and businesses across Australia will continue to want help getting more customers? Yes, it’s highly likely, business owners like getting customers.
But is it likely that Bitcoin will grow another 1000% in 2018, just like it did in 2017? No one knows. There is no possible or accurate calculation because it’s so new and has very little history.
On January 1st 2019, I could be recording another podcast episode for you saying:
“wow… i wish I invested that $10,000 into Bitcoin, I could have bought a investment property with that profit outright”.
But there is no way to predict the likelihood of that happening.
But I can invest $10,000 into Facebook Ads and speak to Aussie business owners about getting more customers. I know that is going to work. Because it’s worked for so long already.
Bitcoin is very very interesting though. I stay updated with what’s happening and read articles and new info on how the technology is being used. But I’m happy to watch on the sidelines. I can still enjoy it from the sidelines. I don’t have to have skin in the game, I’ve got more than enough going on as it is.
So no Bitcoin for me, and I wouldn’t recommend it.
Just focus on what your customers want, and you’re already 90% of the way there.
In the next episode I want to tell you a story about some beautiful smoked chicken wings, cooked over coals. They were juicy, fresh, tasted amazing… but STILL didn’t impress.
Listen to Episode 25 for that story.