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Wednesday, 30 September 2020

What is Bitcoin's Escape Velocity?

When investment gurus Paul Tudor Jones and funds Micro Strategy are getting in on bitcoin we are at a point where we have to consider where we are on our metaphorical route to the moon. With the price for a full coin at around 10k it can be intimidating, but we are on the satoshi standard now and you can have 100 of them for 1 cent. So as that number bias will fade out. Escape velocity to the next moon I think is approaching and is more about a comparative entry point. Bitcoin, at least as it is now, is a tool for bringing everyday people out of poverty so the escape velocity price is going to be about the moment, what you can afford in one go and the current volatility and price direction. 

At the moment the price is moving generally up but can fluctuate a lot. I don't think many average people would fork out more than 20k for a bitcoin investment in this situation. This means 

Its not scientific, its emotional, but this is what matter as it comparative wealth not just the number that makes the difference. In the face of a 20x bull run from here the stash of sats would be worth 400k something that many people would never be able to save and invest.

When the price starts going straight up the amount people will spend will actually go up, because it seems like a better risk, leading to the moon ramps we have seen. The early investor out paces this though because the commitment value does not increase as much or as fast as the price. 

So the escape velocity is different for everyone. The challenge is getting everyone to feel it before big organisations and governments get in on it at that stage you want to be above your escape velocity line. the best way I would say is to slowly and consistently save The question to be clear on in your own head is, in this moment are you at or above the escape velocity line? Do you have more than 2 BTC or I should say 200 million sats? Maybe a million sats is enough.      



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