Every once in a while, a new technology reshapes the world.
Fire did.
The wheel did.
Electricity did.
The internet did.
Each time, the people who benefited the most were not necessarily the smartest.
They were simply early.
Bitcoin may be another such technology.
And if that is true, the biggest risk may not be buying Bitcoin too early, but not owning any at all.
This article explains why a small allocation may be enough.
Most People Don’t Have 100 Hours
Understanding Bitcoin can take time. It often involves learning about monetary history, central banking, game theory and technology. For many people, it can easily take a hundred hours to grasp the idea.
But most people are not willing to take that time to study Bitcoin. They have jobs, families and other priorities.
So there is a simpler approach: buy 1% first, then read about it.
Curiosity often follows ownership.
Owning a small amount changes your incentives. Once you have exposure, you start paying attention. You start learning.
The Asymmetric Bet
Allocating 1% of your portfolio to Bitcoin is an asymmetric bet.
The worst case is straightforward: Bitcoin fails and you lose 1% of your portfolio’s value.
The best case is very different. If Bitcoin continues its adoption and becomes a major global monetary asset, the upside could be 100x or more over time.
A 1% allocation ensures you are not left behind if Bitcoin succeeds.
A small bitcoin stake is insurance against being wrong about Bitcoin.
Why Bitcoin?
Critics often respond that there are many other assets. Stocks, gold, real estate and commodities all compete for your capital.
But Bitcoin has two unique properties.
First, you can still be early.
Second, the supply is capped forever.
This is generally not the case for other assets. For most traditional assets, supply tends to increase when demand increases. Bitcoin does not.
Because you are still early to this scarce asset, a meaningful share bitcoin can be bought for relatively little money today. SatoshisPerPerson.com illustrates how little Bitcoin there would be per person if the supply were evenly distributed.
Bitcoin does not increase its supply when demand increases.
There is also a uniquely passionate global community behind Bitcoin. Millions of people across the world are building, holding and defending the network. There is no marketing department and no central authority coordinating it. There are only incentives. That kind of social and economic gravity is rare.
If you want to understand Bitcoin on a deeper level, there are countless brilliant sources to study. If you are willing to do the work, you absolutely should. Just try not to delay your first purchase because of it.
Earlier Is Better
Bitcoiners often say that it’s never too late to buy Bitcoin. And rightly so. But some moments are still better than others.
Early adopters face the most uncertainty, but they also capture the largest potential upside. Late adopters get more certainty, but usually at a much higher price. Therefore, there is a risk in waiting with your purchase.
Bitcoin could ten-fold before you finish your research.
You may feel like you’re already late. But five years from now, this moment will probably look early. Most people who understand Bitcoin wish they had started accumulating earlier. This is your opportunity to not feel that way in the future.
Because supply is fixed forever, you know that you are buying a meaningful share of the network for relatively little money today. Other assets increase their supply when demand rises. Bitcoin does not.
The Real Question
Don’t start by asking yourself whether Bitcoin should be 50% of your portfolio, or even 10%.
The initial question is much simpler:
Should Bitcoin be 0% of your portfolio?
If there is even a small chance that Bitcoin becomes a major global asset, a 0% allocation may actually be the riskiest position.
You don’t need to bet everything.
You don’t need to understand everything.
You don’t need to reach 0.1 or even 0.01 bitcoin.
One percent is enough to be safe.
The window of opportunity is closing fast.
Buy a little. Then learn.