Checks are in the mail following the signing into law of the $1.9 trillion stimulus package. Many individuals in the US will receive checks in the amount of $1400 with families receiving more. Whether you like the law or not, all of those billions of dollars helicoptered into the economy need to go somewhere and like past stimulus legislation, a portion of it will go into investing accounts – perhaps into crypto like Bitcoin.
So should you take the not-so-free money (eventually someone needs to pay it back) and put it into Bitcoin or other cryptocurrencies? Two industry insiders had this to say:
Alex Mashinsky, CEO/Founder, Celsius Network – a rewards earning crypto platform, said if you need to pay rent or cover debts do that first:
“Only if you have excess cash and you can afford to put 10-20% into BTC. There has never been a bad time to buy BTC, as we are at an all time high and BTC is still the best performing asset for most of the past 12 years. No matter what you decide, one should buy in small increments, several times a year, since no one knows when is the best time.”
Hunter Merghart, Head of US, Bitstamp, a Bitcoin exchange, said like any investment there is risk involved by Bitcoin can be part of a diversified portfolio:
“… what we have seen in the past, and even more so lately, BTC has been able to mostly outperform other asset classes. I view BTC, still, as a venture bet more than anything else, and with that any investors need to understand that volatility is likely to be higher, but the potential for returns to look also like venture returns. Dollar cost averaging is a great way to invest in this asset class given that volatility.”
This past week, an analyst at Mizuho said he expects a good percentage of people to take that check and buy Bitcoin. As many people view it as a windfall this should not come as any surprise.
Meanwhile, Bitcoin has surged higher since the beginning of the year reaching new highs while experiencing rapid changes in price.