The year 2022 got off with a bit of uncertainty in the cryptocurrency markets. After enjoying a brief Santa Claus rally in late 2021, the exchange price of Bitcoin against the United States dollar plunged for two straight weeks until it almost touched the bearish $30K trading level. Thankfully, a wave of bullish traders helped to bring BTC/USD back above $40K, and many market analysts are forecasting a return to the $50K level of support later this year.
Seasoned cryptocurrency investors have mostly shrugged off Bitcoin’s less-than-stellar start of the New Year; after all, they have gone through similar situations many times in the past. Volatility is something we have learned to expect from the digital currency markets. If anything, smart investors know that bearish periods in the crypto markets do not last forever, and they often present great opportunities for “buying on the dip.” This is a strategy that can really pay off when combined with patience, money management, and discipline.
The Number of Successful Bitcoin Investors
In February 2021, a CBS News review of the Bitcoin public ledger indicated that more than 100,000 digital wallets held over a million dollars worth of tokens. What this means for prospective investors is that the potential of generating wealth through cryptocurrency is real. Even United States Senator Ted Cruz recently disclosed an acquisition of at least $15,000 worth of Bitcoin; he is clearly seizing the moment and buying at the right time. If the market turns in favor of the Republican Senator from Texas over the next two months, and if he holds onto it, his BTC/USD position could quickly turn into $25,000 or more.
Let’s say Senator Cruz will increase his Bitcoin position in the near future. As of February 6, and if we continue to assume he invested $15,000, his position has grown to nearly 0.36 BTC. Should the projections by optimistic market analysts materialize, Senator Cruz would turn his investment into $50,000 by May 2022. This is not a far-fetched scenario, and it is a clear example of how cryptocurrency investing can generate real wealth.
Successful Cryptocurrency Investors in the News
The New York Post has been profiling investors whose digital currency holdings have catapulted their personal finances. Last year, the newspaper published the story of Allie Rae, a 37-year-old woman who resigned from her nursing job at a Boston hospital in order to produce adult content on the OnlyFans digital platform. It did not take long for the former nurse to start earning $100,000 per month; Rae then became interested in cryptocurrency investing, which she was able to turn into $1.3 million. The next step for Rae was to fund an entrepreneurial project named WetSpace, which can be described as an OnlyFans competitor where content producers are paid in cryptocurrencies.
Another millionaire recently profiled by the NY Post is Kane Ellis, an Australian man who started mining Bitcoin in 2011. At one point, Ellis was mining up to four BTC tokens per day. Similar to Rae, Ellis used his cryptocurrency investing profits to fund a startup project. First, he acquired a few exotic cars and then built CarSwap, an online automobile marketplace geared towards luxury sports cars and classics.
An even more interesting investor profile showcased by the NY Post was Rachel Siegel, a former public school teacher who worked in Manhattan and has been taking positions in the crypto markets since 2017. What makes Siegel stand out is that she started off acquiring tokens with small amounts. Her teaching job allowed her to invest about $25 per week, but she stuck to this strategy with a high degree of discipline.
Siegel is just 29 years old, but she has been diligently investing for more than five years, and this dedication has genuinely paid off. The former teacher is now a full-time cryptocurrency investor and the owner of a beach house, which is something she envisioned becoming a couple of years ago when she looked at how much her portfolio had grown.
Calculating the Advantage of Compound Interest
Of all the investor profiles listed above, the former school teacher truly stands out because the modest strategy she applied, in the beginning, is similar to compound interest. Siegel did her homework with regard to money management; she figured out that subtracting $25 a week from her paycheck was what she could reasonably afford to lose in case things did not work out. Then, once her portfolio started looking better, Siegel increased the amount of her weekly investments by means of cutting down on some expenses she could do without.
If you plan on getting started with digital currencies in 2022, following Siegel’s example would be a good move. To make things even better, you could deposit your profits from cryptocurrency investing in an account that pays compound interest on a daily basis. This strategy could be your ticket to building real wealth, particularly if you commit to a regular schedule of deposits over a long period. In addition, you can estimate how much your crypto investments may grow by using our own daily compound interest calculator.