Business Insider author invested in Bitcoin six months ago in two ways, resulting in one rise and one fall, providing a practical reference for novice Bitcoin investors to choose strategies.
(Background: Several senior Iranian officials dead! Initiating “unlimited” retaliation against Israel, deploying drone combat groups)
(Context: Israeli Prime Minister: We struck the “Iranian nuclear weapons program,” bombing major uranium enrichment facilities, Bitcoin plummets)
Bitcoin rebounded strongly from a low of $49,000 in August 2024, and with Trump’s return to the White House boosting it, broke through the $100,000 mark in December. Today (the 15th), Christine Ji, an author at Business Insider, shared her two investment options in Bitcoin from last December. Both were optimistic about Bitcoin, but the outcomes were vastly different, which might provide some investment reference for you.
During my first attempt at Bitcoin investment, I bought a share of BlackRock’s iShares Bitcoin Trust (IBIT). Later, I increased my holdings in Semler Scientific (SMLR), a medical technology company that holds Bitcoin on its balance sheet. I wanted to explore various ways to invest in Bitcoin.
Spot ETF: The most direct way without dealing with cold wallets
IBIT tracks Bitcoin spot prices on a one-to-one basis through physical holdings, with a management fee of 0.25%, and is regulated by the U.S. SEC. Reports from Nasdaq indicate that IBIT’s asset scale has surpassed $70 billion, achieving the fastest growth rate in ETF history, attracting both institutional and retail investors. Expert Robert Cannon pointed out:
“A spot Bitcoin ETF is currently the cleanest and most convenient way to gain exposure to Bitcoin, especially suitable for investors who are new to cryptocurrency.”
Over the past six months, IBIT has risen 14%, slightly outperforming Bitcoin itself, which increased by 12%, and significantly ahead of the S&P 500’s 2%. For investors who want to participate in price movements without having to manage private keys themselves, Christine believes it is a good entry point.
Bitcoin rises, but SMLR falls
On the other hand, the medical device company SMLR lists Bitcoin as a treasury asset, theoretically, its stock price should resonate with the cryptocurrency’s value. However, reality reminds investors that companies holding Bitcoin also bear additional operational and regulatory risks.
The Department of Justice is investigating SMLR’s medical marketing practices, leading to a 40% evaporation of its stock price within six months. Analysis from Cointelegraph bluntly states that companies putting Bitcoin on their balance sheets will simultaneously amplify operational, reputational, and leverage variables, but not every company can withstand shocks like Strategy Inc. or Tesla.
Three questions to decide which path to choose?
Through Christine’s experience, when you want to invest in Bitcoin, you can reflect on these three questions:
- Purpose: Do you just want to follow the price fluctuations, or are you also betting on the company’s transformation?
- Cost: IBIT has an annual management fee of 0.25%. While self-custody avoids annual fees, it incurs security costs and requires more knowledge; if buying a Bitcoin company, one must assess corporate leverage and dilution risks.
- Risk: The high volatility of Bitcoin is already stimulating enough; if you add uncertainty from company operations, investors must be able to withstand a double blow. InvestorDaily believes that a lack of reserve proof or excessive convertible debt might trigger a chain selling pressure during a bear market.
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