Cathie Wood recently revised her $1.5 million prediction for Bitcoin in an interview with CNBC, saying that stablecoins could capture some market share. However, it’s worth noting that the digital asset hit an all-time high of $126,000 in October, while just 15 years ago it was worth just a penny.
It’s impossible to predict which direction the price of Bitcoin will go, but it can be entertaining to see what its value might be if you retain previous investments in the cryptocurrency.
For this article, we will examine what would have happened if someone had purchased Bitcoin at the listed price in 2010 and held the digital asset until now. Will this be enough money to retire?
How much would you have had if you had invested earlier?
Let’s say you wanted to take a risk and invest some money in cryptocurrencies as an early adopter. Although we can trace the origins of Bitcoin back to 2009, it had no clear price until 2010. According to Coin Codex, Bitcoin was trading at just 5 cents per coin in July 2010. It reached a high of $0.39 in November and then closed the year at $0.30.
While cryptocurrency prices fluctuate wildly, as of the morning of November 7, Bitcoin was priced at $100,063. This number varies throughout the day, but in 2010 your $0.30 investment would be worth more than $100,000. Even if you bought Bitcoin at $0.39, you would get a six-figure return on your money as the asset crosses $100,000 in 2025.
If you invested $100 in the digital asset and bought it at $0.30, you would have 333.33 units of Bitcoin, worth $33,354,333.3 today.
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Can you retire with 1 Bitcoin invested in 2010?
According to a study by Northwestern Mutual, Americans believe they will need to save $1.26 million for retirement in 2024, down from a figure of $1.46 million. While the amount someone should set aside for their golden years will depend on their personal goals and other assets, it serves as a starting point worth considering for this discussion.
If, for some reason, you bought just one Bitcoin in 2010, you wouldn’t be able to retire on $100,063. Assuming this was your only retirement investment, you’ll still have to work because you can’t live off this amount. If you spent $100 on Bitcoin in 2010, you would have over $33 million and could obviously live a luxurious retirement, assuming you never sold the digital asset.
What about 10,000 units of Bitcoin?
According to Fortune, many members of the crypto community refer to May 22, 2010 as “Bitcoin Pizza Day” because a software developer used 10,000 Bitcoins to pay for two pizzas to be delivered to his home. This is the first real-world cryptocurrency transaction, and 10,000 units covered a $41 pizza order. If this person still had 10,000 Bitcoins, the investment would be worth about $1.001 billion, which is certainly enough to retire on.
The positive side of Bitcoin investing since 2010
Chances are that if you bought Bitcoin in 2010, you were probably testing the waters and didn’t expect it to become your retirement plan. You probably have other retirement investments and assets set aside for your golden years. This means that by investing a small amount in a digital currency when it first came out, you will have at least $100,000 extra saved for your retirement.
Is it worth investing in crypto?
While the price of Bitcoin has risen from pennies to the six-figure mark, it is still worth considering whether it is worth investing in the digital asset for your retirement portfolio. Here’s what the experts have to say.
Investing in crypto for retirement is still risky
Robert R. Johnson, PhD, Certified Financial Advisor, (CFA), CAIA, and Professor of Finance at the Heider College of Business, Creighton University, believes that the risk associated with Bitcoin is very high because it cannot be evaluated using traditional fundamental financial tools.
“The crypto market has never been a good place to invest. At times, it has been an extremely profitable place for some people to speculate,” he said.
Although it can be entertaining to look at the returns in the cryptocurrency sector, one has to remember that this is still speculation, and you don’t want to trust your retirement on it.
You can allocate a small percentage to digital assets
“Due to the volatility we see in the cryptocurrency markets, it would be wise to limit your investments in this asset class to only a small portion of your disposable income, as declines of 70% or more are relatively common,” said Joe Breyer, President and CEO of Lake Country Advisors.
“By planning your exit strategy before investing, you can set a price target for when to begin selling portions of your investment to achieve your desired level of diversification.”
If you missed the opportunity to invest in Bitcoin in the early days, consider setting aside a small amount to experiment in this area.
Breyer believes that discipline will continue to yield better results than emotional decisions in this market. It’s also worth noting that many digital assets have degenerated over the years, and it would be impossible to know whether it made sense to allocate your money to Bitcoin in 2010, as the process for doing so was confusing.
You can entertain yourself by seeing what investing a few dollars in Bitcoin would have done in 2010, but you can’t plan your retirement based on hypotheticals.
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This article originally appeared on GOBankingRates.com: Could you retire rich with 1 Bitcoin invested in 2010?
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