Investing $100 in Bitcoin does not make you rich but allows you to obtain interesting profits over time with an investment accessible to all. Here’s how much you would have earned over time.
The Securities and Exchange Commission (SEC) recently approved 11 Bitcoin ETFs, sending its price on a rally. This is a crucial step toward the regulation of Bitcoin, after years of volatility and uncertainty around “the King of Cryptocurrencies”.
The world of cryptocurrencies is constantly evolving and Bitcoin continues to be the most popular and talked about cryptocurrency on the market, but not everyone is willing to invest large sums of money initially. This is why many wonder if it is possible to invest only 100 dollars in Bitcoin and how much one could earn with such a sum.
For example, if you had invested 100 dollars in Bitcoin at the beginning of 2021, the return would have been very high, as the value of Bitcoin has skyrocketed during this period. However, the turbulence seen in 2022, from the crash of Terra Luna to the failure of the cryptocurrency platform FTX, showed that cryptocurrencies are risky investments and their value can fluctuate greatly in a short period: a drop of 30% of the price of Bitcoin in a single day is not all that out of the ordinary.
In 2023, however, Bitcoin rebounded heavily, growing over 150%.
For those only looking to invest a small amount of money, Bitcoin remains the obvious choice. But what can you expect if you invest $100 in Bitcoin today? In this guide, we’ll explore what could happen to an investment over time. It must be said that one cannot expect to make a fortune with such a small investment, but if the Bitcoin bet pays off, some gains can still be made. The important thing is always to be aware of the risk you are running and to have a well-defined investment strategy.
What is Bitcoin and how does it work
Bitcoin is a decentralized cryptocurrency created in 2009, which is based on blockchain technology. The blockchain is an immutable, public digital ledger that records all transactions securely and transparently. The network of nodes that manage the Bitcoin blockchain uses cryptography to validate and verify transactions and generate new Bitcoins. The maximum number of Bitcoins in circulation is limited to 21 million units, which has helped to increase its value over the years and the interest of more and more investors.
However, the value of Bitcoin has fluctuated markedly over time: from all-time highs of around $69,000 reached in November 2021, prices dropped by more than 75% before picking up again. Investing in cryptocurrencies also involves other types of risks, such as scams and cyber attacks.
To buy and sell Bitcoin, you need to use a cryptocurrency exchange or a trading platform, choosing the one that best suits your needs and strategies. These services allow users to exchange Bitcoin for other cryptocurrencies or for traditional currencies such as the dollar or the euro.
Bitcoin’s value over time
The value of Bitcoin has fluctuated considerably over the years, making it an extremely volatile cryptocurrency. In 2009, when it was created, a Bitcoin was worth less than a cent. In 2017, its value peaked at nearly $20,000 but then fell sharply. In November 2021, the value of one Bitcoin reached an all-time high of around $69,000, before undergoing a new correction.
The fluctuations in the value of Bitcoin have been caused by many factors, including market supply and demand, government decisions regarding the regulation of cryptocurrencies, news and announcements regarding Bitcoin and other cryptocurrencies, public perceptions of cryptocurrencies, and the competitiveness between different cryptocurrencies. Market volatility has led some experts to criticize Bitcoin as a risky investment, while other proponents believe that Bitcoin’s value will continue to rise over time.
The future prospects of the value of Bitcoin are difficult to predict, but some experts forecast the beginning of a new rally with the upcoming halving. Investors are increasingly closing their short positions, creating an upward cycle for the cryptocurrency that could last for the following months.
How much would you earn from Bitcoin?
Investments in Bitcoin can lead to substantial gains, but also significant losses. There are numerous examples of investors who have made substantial money by buying Bitcoin at a relatively low price and then selling it at a higher price.
As with any other type of investment, it is important to note that past results do not necessarily guarantee future gains and that investments in cryptocurrencies are always risky.
For example, in 2010 the value of a single Bitcoin was just a few cents, while today the market value of a Bitcoin exceeds $34,060. There have been numerous instances where investors who have bought Bitcoin in the past have made substantial money by selling it at a higher price, but also times where the price has declined.
Here’s how much you could have today if you had invested 100 dollars in the past.
| Year | Bitcoin price | Bitcoins purchased with $100 | Investment value as of January 12, 2024 | ROI |
|---|---|---|---|---|
| 2016 | $436 | 0.23 BTC | $10,577 | 106x |
| 2017 | $960 | 0.10 BTC | $4,598 | 46x |
| 2018 | $14,500 | 0.0069 BTC | $317 | 3.1x |
| 2019 | $3,800 | 0.0263 BTC | $1,209 | 12x |
| 2020 | $7,300 | 0.0137 BTC | $630 | 6.3x |
| 2021 | $29,200 | 0.0034 BTC | $156 | 1.56x |
| 2022 | $47,800 | 0.0021 BTC | $96 | -0.96x |
| 2023 | $16,700 | 0.0060 BTC | $276 | 2.76x |
| January 1, 2024 | $42,496 | 0.0024 BTC | $117 | 1.17x |
In short, if you bought $100 worth of Bitcoin at the 2016, 2017, and 2019 highs you could make a significant return selling now. If instead, you bought it in 2018, 2020, and 2021, or at the beginning of 2023, you would make a small return by selling now. Finally, if you bought $100 worth of Bitcoin in early 2024, perhaps waiting precisely for the new Bitcoin ETF, you should hold onto it, as the current rally might give you some return.
How much would you have earned if you bought Bitcoin in 2019 and sold at 2021 highs?
To determine how much you would have earned if you bought Bitcoin in 2019 and sold at 2021 highs, several factors need to be considered, such as the purchase price, the sale price, and the transaction fees.
Let’s say you bought Bitcoin in May 2019. At that time, the price of Bitcoin was around $7,585. Let’s also assume you held your Bitcoin until the highs of November 2021, when the price hit nearly $69,000.
Similarly to what we did before, let’s calculate how many Bitcoins we would have bought in 2019: $100/$7,585=0.0132 BTC. If we had the patience to wait more than two years, guessing that in November 2021 Bitcoin would have reached its all-time high, here’s how much we would have earned:
Bitcoin purchase price in 2019: $7,585
Bitcoin selling price in 2021: $66,928
capital gain: 0.0132 BTC x $66,928 = $883.4
gross profit: $883.4 - $100 = $783.4
The ROI (Return on Investment) of your Bitcoin investment would be 7.83x, 783%.
However, transaction fees must be taken into account. Transaction fees vary depending on the exchange used and transaction volume. Typically, transaction fees for cryptocurrencies are expressed as a fixed fee plus a percentage of the amount transacted. For an investment of $100, commissions can vary between $8 and $20:
Transaction fees (hypothetical): $12 x 2 (buying and selling) = $24
Net income: $783.4 - €24 = $759.4
So, in this hypothetical scenario, you could have made around $759 if you bought Bitcoin in 2019 and sold at the November 2021 high. Of course, these calculations are based on past data and do not take into account any future price fluctuations, taxes, and the actual transaction fees you may incur.
How much do I earn if I invest 100 dollars in Bitcoin today?
The analysis of the potential gain of an investment of $100 in Bitcoin today requires the evaluation of multiple factors that can influence the return on the investment.
leggi anche
Is Bitcoin Undervalued?
First, it is important to consider the current price trend of Bitcoin. The Bitcoin price is notoriously volatile and can experience significant fluctuations in a short time. In general, a higher price of Bitcoin increases the potential gain but also increases the risk of loss.
Also, it is important to consider the transaction and maintenance fees of investing in Bitcoin. Transaction fees may vary depending on the exchange or platform used, while maintenance fees may include the purchase of specialized mining hardware or payment of wallet management fees.
Another factor to consider is the investment holding time. Bitcoin is known for its short-term fluctuations, but a long-term investment can offer more earning opportunities. However, it is important to keep in mind that long-term holding can also increase the risk of loss in the event of a significant fall in price.
Finally, it is important to consider the availability of information and investment management tools. Experienced traders can use technical and fundamental analysis to make informed investment decisions, but new investors can also use tools such as market analysis and price predictions to make more informed decisions.
In general, an investment of $100 in Bitcoin today can offer an interesting potential gain, but it is important to carefully consider all the factors that can influence the return on the investment. As with any investment, it is important to evaluate your risk profile and make an informed choice.
Original article published on Money.it Italy 2023-05-21 07:47:00. Original title: Quanto guadagno se investo 100 euro in Bitcoin?
