Bitcoin price: Barefoot Investor Scott Pape gets realistic about making it big off cryptocurrency

Having existed for around 12 years, cryptocurrency is still in its infancy. The digital monetary system broke into the mainstream around 2017 when investors began flocking to assets like Bitcoin and Ethereum. Several thousand early adopters came away with fortunes, and the prices, while still wildly fluctuating, are still trending upwards deep into 2021.

The phenomenon has seen the rise of literally thousands of digital assets, sparking intense scrutiny for those in the existing financial system. Some more conservative economists see the technology as an easy scam to prey on investors chasing a quick buck, but others truly believe cryptocurrency, despite its early flaws, to be the future of wealth and trading.

In a recent column on his personal website, the Barefoot Investor broke down the risk of diluting your funds across several coins, warning that not all of the assets are likely to boom as significantly as Bitcoin.

“I think what’s going on in the crypto space is absolutely fascinating,” he said.

“We’re in the early stages of a revolution, watching the financial industry be both disrupted and democratised. Clearly, this is the future.

“Yet history also teaches us that in every gold rush there are scams, cons and bubbles just waiting to be popped. This time is no different. If anything it’s worse — today a majority of Gen Z investors in the US think crypto will make them millionaires, according to a new survey by data analytics firm Engine Insights.”

The volatility of the cryptocurrency market is something to behold. Earlier this year, the joke coin Dogecoin became the world’s fourth biggest crypto after a burst of interest from Tesla boss and crypto fan Elon Musk.

Despite many Dogecoin investors making astronomical gains off the back of an internet meme, Mr Pape said the pipe dream of earning millions of dollars from a tiny investment is over.

“There are now a staggering 7773 cryptocurrencies, according to Coinmarketcap (compared to 180 traditional currencies across the world!),” he continued.

“Let me be clear: I am sure that a handful of these will be genuinely transformational (don’t ask me which ones). And I’m also just as sure that the vast majority of these coins will end up being worth digital diddly squat.

“Still, now that crypto has gone mainstream, it’s me who needs the reality check. Statistically, there’s a good chance you own crypto … or at least you’re thinking about it. And if that’s you … all I can say is best of luck!”

At the time of writing, Bitcoin is worth AU $83,861 per coin.