When I first started out in Bitcoin, it was right before the rush. There was incoming hype and many people were excited about what Bitcoin meant and why decentralization was amazing.
Bitcoin has grown from early enthusiasm to a specialized niche where industrial level solutions are being implemented for mining.
I remember the story of a man called James Howell: James Howell is an IT worker living in Newport, South Wales, United Kingdom. He heard about Bitcoin in the early days and started mining bitcoin on his personal laptop in 2009. This computer broke in 2013 but he kept the hard drive in case bitcoin became valuable one day. It did and while cleaning his home that year, he mistakenly put the drive into a waste bin at his local landfill site in Newport, South Wales, where it got buried.
At the peak of Bitcoin’s triumph, circa December 2017. All his lost bitcoins were worth more than $117 million.
All that $117 million is now lost.
I remember in 2012 when Bitcoin rose to $13.30 for the year and Bitcoin Gurus started popping up out of the woodwork. After ups and down, Bitcoin was at $770 by 1 January 2014. Further ups and downs continued until Bitcoin was at $998 on 1 January 2017.
Prices started at $998 in 2017 and climbed to $13,412.44 on 1 January 2018, after reaching its all time high of $19,783.06 on 17 December 2017.
With all this hype and FOMO, many Gurus were making lavish calculations and predictions and many individuals out of maybe share greed or FOMO followed these Gurus off a cliff.
One thing is for certain, Bitcoin is extremely volatile, and the future is unpredictable due to it’s halving every 4 years, spikes in mining difficulty, wash trading by whales on the different crypto exchanges, as well as hacking on the major Bitcoin holding platforms.
The price can dip and spike in a very unpredictable way.
With all this HYPE, people just followed blindly like sheep and got put in many compromising situations.
I have seen guys shill BitConnect until it crashed and people’s money vanished. They then deleted the connected YouTube videos and started over shilling something else.
BOTTOM LINE: be careful
FOMO, the fear of missing out is a real thing.
In early 2017, Bitcoin’s collective hashrate reached nearly 4 Exahash.
Tens of millions of people around the globe were in FOMO and Hodling (holding on for dear life) Bitcoin.
In June 2019, Bitcoin shot up by over $1,000 overnight.
eBay announced (and later retracted) that it would be accepting cryptocurrency payments. Microsoft came out with its plans to build on the Bitcoin blockchain. North American food chain Whole Foods also joined the revolution and the price started to soar. (Source: Yahoo Finance).
When people want to find out more about something, they typically hit up Google and start typing in search words. Thought google might not be the only search engine, it is the one with the most market share at 88.47% as of April 2019.
So in late 2017, Google was on fire when it came to searches involving Bitcoin and many people were FOMOed which drove the price even higher.
For myself, I was not a novice investor. So I knew the hype but didn’t make it control me. I did buy at over 5k but all the Bitcoin I had was safe in my ledger and I was not about to buy Bitcoin over a certain dollar amount.
The crazy thing is, many “investors” bought at the top because they believed that Bitcoin would go even higher.
BAD IDEA, especially since at what it is selling for right now and the low points it was hitting back in early 2019.
Remember Bitconnect? Remember all the news articles and YouTube videos surround the chaos? Remember MountGox? Remember Quadriga?
There is a plethora of ways to lose your Bitcoin or have them stolen. You could be hacked, a platform can be hacked, you can release your coins to cloud mining and they won’t ever return them.
You can forget your password to your coins, you might lose your ledger wallet. Your computer might crash and damage your hard drive.
In the still Wild West world of cryptocurrency. Theft is and will be for the next few years, a very legitimate problem.
Even I have forgotten passwords and keys to my crypto but then days later to remember then or have the keys stored somewhere.