What if You Invest $100 in Bitcoin Today? - Phemex Academy (2022)

Author: Contributor Date: October 13, 2022

Key Questions Answered

How Much Is $100 in Bitcoin Today?

At the current price of $19,367 per bitcoin, $100 will get you 0.005157 of bitcoin.

But what is the real value of Bitcoin?

Two factors play a significant role in determining Bitcoin’s real value or price—its utility and the coin’s perceived value by stakeholders. That said, the actual value of BTC as an investment instrument can dramatically go up and down, as we’ve already seen.

On the upside, Bitcoin is still the crypto that enjoys the most robust utility as a medium of value exchange. With that, many prominent Bitcoin bulls have gone on record saying that it will go to $500,000 or even $1 million in the coming decade, if not years.

In short, nobody knows the real value of Bitcoin. It is still a maturing asset class that is very much at the stage of price discovery. Any form of innovative technology–such as the internet 20 years ago, will no doubt go through the same stage before its value stabilizes. That is when the real value of Bitcoin will emerge.

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How Much Are the Fees to Buy $100 of BTC?

That depends on the fees charged by the crypto exchange you use to buy your bitcoin, and typically range between 0% to over 1% per trade. Phemex’s spot trading fee is highly competitive at 0.1%. This means if you buy $100 of BTC, there will be a fee of 0.1/100 x 100 = $0.10.

What Would Happen if You Invested $100 in Bitcoin in 2022?

Let’s take a look at the highs and lows of Bitcoin price in 2022.

If you had invested in March 2022, you would have bought at a high during that market cycle, and be sitting on a 60% unrealized loss right now. Your $100 would have shrunk to $40.

If you had invested in June, when Bitcoin hit a low of $18,900, congratulations–you’re still in the green, as of Oct 2022. However, as anyone who has spent any time crypto trading will know, it’s extremely hard to time the market.

The best strategy is to use the Bitcoin dollar cost averaging strategy to spread out the risk; this way, you’re not pressured to identify the market bottom and yet you can take advantage of further dips.

Is Now the Right Time to Invest in BTC?

Since you’ll only be investing $100, you’ll want to maximize what you get for your money by buying Bitcoin at the best price. On the one hand, you cannot know if a better price won’t appear after you place your order. On the other hand, waiting endlessly can result in you never realizing your investment.

As you may have heard, crypto assets have been going through a bear market for some time. Thus, now may be a good time to buy Bitcoin at a discounted price. That is as long as your research shows that this asset has the potential to bring you profit on a trend reversal.

Some analysts say that now is a good time to invest in Bitcoin, while others expect the asset to drop even lower in the coming months as the certainty of a global recession solidifies. You can set a market order at your desired price so the trade will carry out automatically.

What are Market, Limit and Stop Orders – Phemex Academy

Will $100 in BTC Make You Rich?

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Bitcoin experienced a huge drop in the middle of June and is showing a slight uptrend ever since its lowest point near June’s end (Source: Coinmarketcap)

Over the past three months, BTC’s price has gravitated between $21,000 – $25,000. If you put in $100 in Bitcoin at $21,000, its price would have to appreciate to $2,100,000 to turn your $100 into $10,000. But even this unrealistic scenario won’t make you rich.

This should not discourage you at all. The benefit of investing in Bitcoin, even if it’s a small amount, is that you’ll get to experience buying crypto. Secondly, even if you only make a small profit of a few dollars, over time, they could bring a decent return thanks to the miracle of compounding.

What If You Invested $100 in Bitcoin in 2021?

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BTC cost $29,807 at the end of June 2021—the lowest price for that year. (Source: Coinmarketcap

Let’s entertain the idea of what would’ve happened if you had invested $100 in Bitcoin in 2021 at its lowest price for that year.

The lowest BTC dropped in 2021 was in June, when it traded for $29,807 as per Coinmarketcap.

If you had bought BTC at that price, it would currently be worth $71, meaning you would be sitting at an unrealized loss of $29—a third of your investment.

But that’s the great thing about spot trading. Even if the price of the asset you’re holding has gone down in value, you can wait for it to appreciate again.

The fact is, if you are disciplined from the onset to never invest money that you need in the short term, you can afford to wait out the bear market and cash in a handsome profit when the market trends up again.

Factors to Consider Before Investing $100 in Bitcoin

The best thing about deciding to invest $100 in Bitcoin is that you don’t have to consider much before doing so. If you have to think long and hard about investing $100, you’re not in a strong enough financial position to make that investment, or any investment for that matter.

Focus on covering your daily living expenses, slowly build up your cash reserves and then consider investing in Bitcoin.

How to Invest in Bitcoins for Beginners?

Investing in Bitcoin is easy as long as you choose the right platform. The main features to look at are:

  • The reputation of the crypto exchange
  • The fees you’ll pay for the transaction
  • Whether you’ll need a separate Bitcoin wallet or the platform offers secure storage of your tokens

Fortunately, good crypto platforms provide detailed instructions and responsive customer support teams to guide you through all the steps.

Here’s a must-read beginner’s guide “How to Trade Crypto” to get you started on the right footing.

Is Bitcoin a Safe Investment? Is It Secure?

Crypto is the most volatile and riskiest asset class to invest in today. Having said that, Bitcoin is possibly the safest crypto to invest in, given its time-tested reputation as an “unhackable” blockchain and the fact that it has been the largest crypto by market cap for as long as it has existed.

It is therefore highly unlikely that Bitcoin will go to zero anytime soon, although again, the volatility of the crypto market shows that no crypto is a particularly stable investment.

At the same time, that doesn’t mean there is no chance of you losing your bitcoins. Remember that the security of your bitcoins is only as strong as the weakest link in the entire system. Carefully consider:

  • The crypto wallet you use
  • The decentralized app (DApp) you interact with
  • The exchange platform you invest with
  • Your diligence when it comes to personal security measures

Can You Lose Money by Investing in Bitcoin?

Technically speaking, if you’re engaged in spot trading as opposed to contract or margin trading, you cannot lose money–if you don’t sell at a loss. This is because of the concepts of unrealized and realized gains or losses.

To understand this in greater detail, read: Bitcoin Realized vs. Unrealized PnL – What’s the Difference?

For example, if you bought $100 of Bitcoin at $69,000 and sold it at $20,000, you would have lost about 70% of your investment.

But if you hold on to your bitcoin, and wait for the price to appreciate again to, say, $80,000 before selling, you would have made a 16% profit.

2 Golden Rules of Investing

It may sound surprising, but your approach to investing and managing your emotions is more important than your technical knowledge. While you can follow dozens of rules, here are just two golden rules of investing that will serve you well regardless of market conditions.

Only Invest as Much as You Can Afford to Lose

This is perhaps the most important rule to follow as an investor. Only invest as much as you can afford to lose. This means investing only amounts that will not affect your quality of life dramatically should bitcoin’s price fall drastically.

Set aside the money you need to cover important expenses such as paying off loans, rent, bills, food, and incidentals. Then you will be able to accurately determine how much money you can afford to invest into bitcoin.

Resisting Fear and Greed

In the investing world, fear and greed are the two destructive emotions that stand between you and profitable trading.

Fear mostly manifests itself in panic-selling i.e. selling at a loss, while greed mostly manifests itself in buying at a high, usually when the market is euphoric and there just does not seem to be a limit as to how high prices can go.

This is when greed (a.k.a FOMO for “fear of missing out”) also starts rearing its little head in you and you think thoughts like, “I better buy now, otherwise I’ll miss the boat!”

Famed investor Warren Buffet may be Bitcoin’s biggest critic (the man did after all refer to it as ‘rat poison squared’) but his #1 investing principle holds true even in crypto trading, “Be fearful when others are greedy and greedy when others are fearful.”

When you feel the greed/FOMO stirring up in you, that is when you stay on the sidelines to wait for a price correction.

How do you know when the market is fearful or greedy? Here’s a handy guide: How to trade using the Bitcoin Fear and Greed Index

Conclusion

Let’s summarize this article where we looked at what would happen if you invested $100 in Bitcoin in today’s market. Given the state of crypto assets in recent months, it’s likely that one of three typical scenarios will occur.

The value of your investment may decrease, increase, or remain unchanged. How long you plan to hold BTC will also influence how much of it you buy today. In any case, investing an amount of around $100 is a great way to take your first step into Bitcoin investing. This way, you’ll still feel like being a Bitcoin investor without risking the shirt off your back.

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