Bitcoin returned 92.00% in 2019, not including any transaction fees. After midnight UTC on January 1, 2019, bitcoin traded at $3,746.71 a coin. And the closing trade on December 31, 2019, before midnight UTC was for $7,193.60 a coin.
The 2019 Bitcoin Return: Speculation, but Greater Acceptance
92% is a heck of a return.
Contrast that with bitcoin's 73.56% loss in 2018... and its 1,318% gain in 2017. Those are some wild numbers – so keep in mind that, even with 11 years of history, bitcoin is speculation not investment.
With bitcoin, you have no claims on the future value of an income stream – as it is with gold and other commodities. Unlike gold and other commodities, bitcoin is entirely virtual. It would be best if you regarded bitcoin as riskier than a typical investment.
I've characterized cryptocurrencies this way in the past, but it remains controversial. You don't need to avoid speculations entirely.
Speculations are still assets – they are just assets that tend to vary more in value than other assets. If you are saving money you need on a specific date (for example, a wedding this year) you shouldn't speculate with that money. For these scenarios, look at something on the über-safe end of the spectrum – something like a money market account, certificate of deposit (with appropriate end date!), or something similar.
If you're young and in good health and don't need money immediately? Have at it. Ditto if you want to deploy money that you otherwise aren't investing and can afford to lose.
Just be prepared for bitcoin's value to fall off a cliff. It's also – of course – possible that bitcoin can provide you with wild positive returns. Who knows?
Source on the 2019 Bitcoin Return Calculations
Historical bitcoin price data comes from CoinMarketCap.
Also: I built a bitcoin return calculator that can factor in inflation.
The 2019 Bitcoin Return
Enjoy volatility? Have an iron stomach? Have money you could lose without too much pain? Bitcoin is a chance to speculate and a chance at significant gains.
Every year I've been tracking it, bitcoin has fluctuated wildly. We've seen it go up many times only to fall quickly. We've seen it cut 3/4 of its price in a year only to bounce back and recover.
The only thing I can predict: bitcoin's price will fluctuate in 2020.
Where do you see bitcoin going in 2020? Do you consider bitcoin speculation as well, or something else?