Bitcoin, the world’s first and most-popular cryptocurrency, reached a new all-time high of $66,974 on Wednesday morning.
The record price follows the United States’ first Bitcoin-linked ETF making its debut on the New York Stock Exchange Tuesday.
Bitcoin’s previous record high of $64,888 occured in mid-April, but the crypto has seen big ups and downs between then and now. Bitcoin lost over half of its value in July, but has been steadily recovering since the end of the summer.
Despite a new high, here’s why Bitcoin investors shouldn’t change a thing.
What Should Bitcoin Investors Do?
Experts have cautioned that a new record high definitely doesn’t mean Bitcoin’s volatility is over — in fact, expect more, experts say.
“It is a nascent industry, and as a result it’s highly volatile,” says Theresa Morrison, a CFP with the Beckett Collective. As such, keep your investment low enough that the “crypto tail doesn’t wag your investment dog,” says Morrison. In other words, don’t invest so much that crypto’s extreme volatility can wreak havoc on your total portfolio.
As a rule of thumb, experts recommend keeping any speculative investments — cryptocurrency, specialized ETFs, alternative assets — to less than 5 per cent of your total portfolio. It’s also important to never invest in cryptocurrency at the expense of not meeting other financial goals like saving for retirement or paying off high-interest debt.
But if you’ve done all of these things and are wondering what to do now that Bitcoin has reached a new high: do nothing. Long-term investors should hang onto their coins, and don’t let the hype of these daily swings influence your investment decisions.
“If you believe in the long-term potential of [Bitcoin], just don’t check on it. That’s the best thing you can do,” Humphrey Yang, the personal finance expert behind Humphrey Talks, previously said.
