Should you Invest in Bitcoin or a Business? How about both?

In developing countries like India, people have a massive fascination with gold. families invest in gold heavily both for cultural and economic reasons. With double-digit inflation ( fueled by money printing ) for the last 50 years in India, most Indians subconsciously prefer storing value in assets like gold / real estate over currency. As a result, India imports an insane amount of gold worldwide ( India spends a record $50 Billion on gold imports ).

Now unfortunately even developed countries like US/ UK / Europe are now poised to suffer from double-digit inflation thanks to insane money printing which is being fueled by huge deficits and slowing GDP growth.

Back to Indians and gold: Indians not only treat gold as an investment but also as rainy-day insurance by borrowing against their jewelry in emergency times. Many families borrow against gold to start new businesses.

Bitcoin - The Digital Gold  

Bitcoin is often hailed as digital gold by its backers and sometimes even by bank analysts, the reasons are simple.

Bitcoin like gold has a limited supply, and wide recognition is apolitical in nature.

Bitcoin being digital has more wonderful use-cases like

1. Replacing swift payment network  - $10 Trillion market potentially
2. Replacing offshore dollar bank accounts - $30-40 Trillion market
3. Some part of global bond market as an inflation hedge - $50 - 200 Trillion

Total market potential $100 Trillion or more

Right now bitcoin market-cap is at $400 Billion so its less than 0.2% of its true market potential.

So selling bitcoin is stupid , if you believe its the world's best store-of-value.

I know what you are thinking , "Hey what about Ethereum, alt-coins , stable coins and sh**-coins." No they don't compete with bitcoin. Learn why Bitcoin has already won.

Monetize Bitcoin and start a new Business

As discussed previously, selling Bitcoin is stupid which includes selling it to start a new business too, instead the smarter alternative is to borrow against it.

Borrowing against Bitcoin has two clear benefits-

1. Since you don't sell Bitcoin, you are not missing out on the upside growth.
2. You don't incur any taxes as you haven't sold the asset.

Let's do the math!

Say you own $500K worth of Bitcoin, you can borrow $250k against (200% collateral ratio) at an interest rate of 5-11%.

So as long as you are able to generate an income in excess of $25,000 through this business venture, you are basically breaking even. Obviously, businesses have many different risk factors, so one needs to be very careful about what one decides to pursue.

But one thing is clear, Selling Bitcoin is stupid!

Disclaimer: This is not financial advice,   this information is purely educational, All Investments carry risk. Always do your own research.