Under the current situation that Chinese citizens generally lack financial knowledge, most people’s understanding of investment is limited to real estate speculation and stock market. Real estate speculation is also due to the need for life, the development policy and urbanization process since China's reform and opening up. These made a cognitive behavior for Chinese. The Chinese stock market is like a playground for giants and powerful people. It is more like an abyss that can't be entered for ordinary people.
So, what investment methods are suitable for ordinary people who have a poor understanding of financial knowledge? I believe that the most important thing is to understand the two core points of investment:
First, the investment target must be beneficial to society. Second, the investment target is a new thing that a few people know. The first point is linked to risk awareness. As time goes by, those industries that are beneficial to society will continuously rise. This is an inevitable trend. The second point is linked to the benefits. Only a few people know that the marginal benefits can be maximized and the best return on investment can be obtained.
Bitcoin, born in 2011, its underlying technology(blockchain) has become a revolutionary technology that is transforming the global financial order. As everyone knows, the maximum limit for Bitcoin is 21 million, each of which can be divided into 10 squares, and the mining revenue is halved every four years. So far, 17 million coins have been mined, so the last bitcoin will be dug in 2140. After that, according to the Bitcoin agreement, no coins can be dug.
The problem here is that not all of the 17 million bitcoins can be traded.
According to a research report by blockchain analysis company Chainalysis, about 4 million bitcoins are currently lost and cannot be retrieved. The main reason is the loss of private keys. This means that the 4 million bitcoins cannot participate in real circulation, it just be displayed in the data of circulation. Therefore, we can understand that the total amount of bitcoin involved in circulation in the world is about 13 million, which means that the total amount of bitcoin will be less than 21 million. So it will become even more rare.
According to Statista, as of the end of September 2018, the number of bitcoin wallets registered in the blockchain exceeded 28 million, but the number of truly active wallets is less than 40%. Currently, the global population is 7.6 billion, that is, as long as one has Bitcoin, he/she has surpassed 99.9% of the world.
Based on the above data, it can be concluded that Bitcoin, born in 2011, is a relatively stable investment option. But for most Chinese citizens, whose monthly income is below 10,000 Yuan, fixed investment is the best choice. The bitcoin price of is 45,094 RMB when the author is writing the article. Even though it is calculated by 45,000 yuan and the monthly fixed investment is 0.05 piece of Bitcoin, it is 2250 yuan. That is not more than half of the monthly income. It is a safe strategy. 1.2 bitcoins will be held in two years in the way of investment, and as the price of bitcoin fluctuates, the monthly investment amount will fluctuate. Bitcoin price have fallen by 72% from the peak of $22,618 at the beginning of the year to the current $6,380, and the long-term bear market may be the best time to enter.
A Harvard scholar predicted that bitcoin prices could exceed $100,000 by February 2021, and the price is nearly 16 times higher than the current price. The scholar announced that Bitcoin is the first cryptocurrency to follow Moore's Law. In an email to Business Insider, investor Dennis Porto said that after analyzing the performance of Bitcoin, Bitcoin is the "first" currency that follows the rules of encryption technology. As every country constantly improve their cryptocurrency policies and do more construction on the ecological application of Bitcoin, the value of Bitcoin will also rise as time goes by.
Whether it is investment or the cultivation of personal values, it should be a long-term goal, taking time as the most important wealth to accumulate more value. Forward-looking people can see five or even ten years of future financial technology development. They are either entrepreneurs or investors and their discount factor are also much higher than ordinary people.