No one can say for sure whether it is a good time to buy bitcoin, since its price is volatile. Only invest what you can afford to lose, and consider speaking with a licensed financial advisor.
I can’t tell you what to do
No one can reliably predict bitcoin’s price, and I can’t give personal investment advice. This is general information.
Facts
- Bitcoin is very volatile: it fell about 64 percent in 2022 and rose over 150 percent in 2023 to 2024.
- Its supply is capped at 21 million coins.
- US spot Bitcoin ETFs were approved in January 2024.
- Prices can swing 10 percent or more in days.
Risks
Loss of value, hacks, scams, lack of consumer protection and tax complexity. The IRS treats crypto as property.
Common guidance
Only invest what you can afford to lose, diversify, and consider dollar-cost averaging. Understand security and storage.
Speak with
A licensed financial advisor.
What this is and is not
Whether to buy bitcoin is an investment decision that depends on your finances, goals and risk tolerance, and this page cannot say what is right for you. I am not a licensed financial adviser. The facts below can help you evaluate the question.
Facts
- Bitcoin launched in 2009 and has a fixed supply cap of 21 million coins. About 19.7 million were in circulation by 2024.
- Price history is volatile. It rose from under $1,000 at the start of 2017 to nearly $20,000 by December 2017, fell to about $3,200 in December 2018, reached about $69,000 in November 2021, dropped to around $16,000 in late 2022 and rose above $70,000 in 2024. Drops of 50% to 80% have occurred several times.
- In January 2024, the US SEC approved spot bitcoin exchange-traded funds, letting investors buy exposure through brokerages.
- Halving events cut the reward to miners in half about every four years. The most recent was in April 2024.
- Bitcoin is not backed by a government, and is not insured by the FDIC or SIPC if held on an exchange.
Risks
- Extreme price swings. You could lose most of your investment.
- Exchange failures and fraud, such as the collapse of FTX in 2022 and Mt. Gox in 2014.
- Hacks and lost keys. Chainalysis estimated that crypto thieves stole about $1.7 billion in 2023, and an estimated 3 to 4 million bitcoins are believed lost.
- Scams promising guaranteed returns. The FTC reported that consumers lost more than $1 billion to crypto scams in 2021 to 2022.
- Regulatory changes and tax rules. In the US, the IRS treats crypto as property, and each sale or trade can trigger capital gains tax.
- Energy use and environmental concerns around mining.
Common guidance
Financial educators often say to invest only money you can afford to lose, keep an emergency fund first, pay off high interest debt, and treat crypto as a small share of a diversified portfolio, if at all. Dollar cost averaging, buying a fixed amount at regular intervals, is one way some investors reduce timing risk. No one can reliably predict short term prices.
Speak with
A fee-only fiduciary financial planner can help you decide. The SEC’s Investor.gov and the FINRA Foundation offer free guides on crypto risks.
Market data and volatility
Bitcoin launched in 2009, has a fixed supply cap of 21 million coins, and its price has swung widely, from about 69,000 USD in November 2021 to under 17,000 USD in late 2022, then to above 100,000 USD in December 2024. Spot Bitcoin exchange traded funds were approved by the SEC in January 2024. Bitcoin’s annualized volatility has often been 3 to 4 times that of the S&P 500. Investors can lose a large part of their money, and the cryptocurrency market is not protected by FDIC or SIPC insurance. The IRS treats crypto as property, so selling or spending it can trigger capital gains tax. I am not a financial advisor and cannot tell you whether to buy. A licensed advisor can help, and many suggest investing only what you can afford to lose and avoiding borrowed money.
Based on data from the SEC and the IRS
