Fun theory for you guys we were discussing in the groups today regarding BTC’s potential during the next economic crash.
This is the S&P 500. It is made up of America’s 500 best performing companies which are freshly picked every year. It is generally considered a good investment since the USA is such a well performing economy. In fact, Warren Buffet has said before “I think it’s the thing that makes the most sense practically all of the time.”
However, looking at the growth since the 2008 financial crisis would have you fear the next will be like nothing we have ever seen. There has been almost 300% consistent growth for 10 years which was inadvertently funded by a government bailout. A crash is due, look at the extent of the 2000 internet bubble and 2008 sub-prime crisis. In 2008 5 years economic growth was lost in just 1 year.
So where does BTC come into this? During a crisis people look to other stores of value out of fear that their dollar value isn’t safe. This used to be gold as an example and prices would obviously rise. But, for obvious reasons it isn’t good for sending or receiving with other people. Wouldn’t it make much more sense to use BTC? Digitally stored, completely safe and can be easily transferred across the world. It seems like the people of Venezuela thought so.
Venezuela is currently undergoing a terrible financial meltdown with 1,000,000% inflation. One you could almost compare to the one I am discussing for the global economy above. With the value of their currency almost completely gone people are resorting to, you guessed it, BTC as a store of value. This is frightening proof of its potential. Will BTC show its true colours during the world’s next boom and bust?