Bitcoin’s price action is logarithmic in nature. The price of bitcoin is likely unable to go below $3,900 at this point, and within a few months that floor will be around $6,200.
Perspective is everything, of course.
2013. This bull run was Bitcoin’s biggest rally on a logarithmic scale. The bear market that followed lasted for about 1.5 years. 2018 has been highly negative for Bitcoin and cryptocurrency, but back in 2014 through part of 2015, the doom and gloom FUD was fierce.
It’s hard to believe, but the massive bull run of 2017 was quite small compared to the 2013 bull run, and the drop of 2014-2015 dwarfs our current bear. Someone who bought Bitcoin in 2012 for 3 dollars could sell for as high as $1,300 in 2013, a gain of over 43,000%. Compare that to the 2017 bull run: Buying for $200 in 2015 and selling for $20,000 in 2017 is great, but it’s actually “only” a gain of 10,000%.
Because Bitcoin has a finite supply, the smart investor and/or trader should really be looking at the percentage gains, not the actual dollar value. It doesn’t matter if Bitcoin is worth $1 or $10,000; buying $100 worth of Bitcoin and it going up in value by 10% gives you a 10% on your money. The same principle applies if price drops in value by whatever %. The current price itself is only meaningful in relation to the price you bought in at.
And at the current prices compared with the speculative value once institutional investors begin piling in, the percentage gains to be had are still very much a positive note.