Crypto Mining Companies are Better Investments
Updated
Bitcoin mining companies are likely the best investments for the next bull run. One aspect that benefits crypto mining companies is that the asset that they generate is expected to increase in value in the future.
This is not the case with most other companies. Take a car company for example. The cars that the company creates will depreciate without question. If the car company produces cars and holds them, the company will go bankrupt.
For crypto mining companies, like MARA and RIOT, they can hold the assets that they produce and the value is expected to increase in the future. Many of the mining companies raised funds in a way that allows them to hold the bitcoin they produce for several years. As MARA and RIOT invest in more mining infrastructure, they will generate and hold more bitcoin.
Why not invest in alts? MARA and RIOT are involved in Bitcoin, which is the most secure and trustworthy crypto. Investing in altcoins can yield higher returns but with much greater risk of going to zero. We all know the risks of altcoins. To name a few: theft/scams by founders, shorter track record and more prone to bugs, infighting by founders, CTOs leaving the project, etc. ADA and BNB performed spectacularly, but I'd still rather hold MARA and RIOT because I feel they are a safer investment in the long term.
Long term, I am bullish on crypto. I think that holding bitcoin mining companies will outperform bitcoin itself for the next 3+ years. Also, I think that the risk of holding companies involved with the Bitcoin network is far less than holding altcoins and results in a much better risk-reward ratio.
Short term, I am waiting for the crypto markets to drop a bit; BTC at
23K or 20k. If that occurs, I will likely switch to bullish and buy crypto mining companies. Until then, I will wait on the sidelines... and tactically short MARA until I am ready to buy it.
This is not the case with most other companies. Take a car company for example. The cars that the company creates will depreciate without question. If the car company produces cars and holds them, the company will go bankrupt.
For crypto mining companies, like MARA and RIOT, they can hold the assets that they produce and the value is expected to increase in the future. Many of the mining companies raised funds in a way that allows them to hold the bitcoin they produce for several years. As MARA and RIOT invest in more mining infrastructure, they will generate and hold more bitcoin.
Why not invest in alts? MARA and RIOT are involved in Bitcoin, which is the most secure and trustworthy crypto. Investing in altcoins can yield higher returns but with much greater risk of going to zero. We all know the risks of altcoins. To name a few: theft/scams by founders, shorter track record and more prone to bugs, infighting by founders, CTOs leaving the project, etc. ADA and BNB performed spectacularly, but I'd still rather hold MARA and RIOT because I feel they are a safer investment in the long term.
Long term, I am bullish on crypto. I think that holding bitcoin mining companies will outperform bitcoin itself for the next 3+ years. Also, I think that the risk of holding companies involved with the Bitcoin network is far less than holding altcoins and results in a much better risk-reward ratio.
Short term, I am waiting for the crypto markets to drop a bit; BTC at
23K or 20k. If that occurs, I will likely switch to bullish and buy crypto mining companies. Until then, I will wait on the sidelines... and tactically short MARA until I am ready to buy it.Note
DOGE is insane. I hid it in the above chart because it eclipses everything else. Sorry, I'll pass on the meme coin. It could keep going up, but nah, I'm good.Note
Correction: the top purple comment should read: "MARA and RIOT in the **2021** run..."Note
And a clean view with only MARA, RIOT, SPY, BTC, and ETH.Note
Note: SPY had big ranges each day around 20 Mar 2020. Depending on where you measure from, you can get up to nearly 100% from the exact bottom. In any case, crypto wins if that is your benchmark.
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