The Motley Fool

Why I think the Bitcoin market crash is NOT an opportunity to make a million

Image source: Getty Images.

While a decline of 80% in any asset’s price over little more than a year may mean it offers recovery potential, Bitcoin’s slump could be the precursor to further challenges for the virtual currency.

Investors seem to be much more realistic now about its potential value. Issues such as its lack of fundamentals, the limited likelihood of it every enjoying mainstream usage and its high degree of volatility appear to have been accepted and understood by investors. And, with the general consensus among investors moving towards increased risk aversion, there may be better opportunities to make a million among assets other than virtual currencies.

5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!

According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…

And if you click here we’ll show you something that could be key to unlocking 5G’s full potential...


While Bitcoin was enjoying a period of sustained growth in 2017, many investors were becoming increasingly optimistic about its long-term potential. This is a fairly regular event in the world of investing, with it having happened numerous times in the past.

For example, in the dot com era there was a significant amount of optimism surrounding the internet and its potential impact on the way business was done. While the internet is having a major impact on the business world, it has taken far longer than was expected around 20 years ago. As such, it has proven to be an evolution rather than a revolution. Similarly, during other bull markets there has been optimism about a variety of other assets, including tulips, various commodities and, in the financial crisis, banks.

The optimism surrounding all of those assets, though, eventually gave way to a realism among investors that growth cannot continue in perpetuity. Bitcoin may now have reached that same point, with investors becoming far more realistic about its potential. Although blockchain could have a major impact on the economy, the limited size of Bitcoin and its lack of infrastructure mean that it is unlikely to deliver the scale of growth which some investors were anticipating.

Risk aversion

Investors are also becoming increasingly risk averse. Fears surrounding the global economy are causing a risk-off attitude to become increasingly commonplace. The impact of this on investment decisions is to focus increasingly on more stable, less volatile assets which offer a higher chance of a return of capital. As such, the potential for investors to become increasingly bullish about Bitcoin over the medium term seems to be somewhat limited. It could even be argued that a price of $4,000 for the virtual currency is difficult to justify.

At the same time, falling stock prices could be of interest to long-term investors. High-quality stocks are now trading with wide margins of safety in many cases, and this could provide investors with the opportunity to generate high total returns in the long run. As history has shown, major stock markets have always recovered from corrections and crashes. Assets that are en vogue for a period of time, though, have not. Bitcoin seems most likely to fall into the latter category, with the stock market appearing to be a better means of making a million.

“This Stock Could Be Like Buying Amazon in 1997”

I'm sure you'll agree that's quite the statement from Motley Fool Co-Founder Tom Gardner.

But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.

What's more, we firmly believe there's still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations.

And right now, we're giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool.

Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge!

Our 6 'Best Buys Now' Shares

The renowned analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.

So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we're offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our 'no quibbles' 30-day subscription fee refund guarantee.

Simply enter your email address below to discover how you can take advantage of this.

I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement.