I know what many readers are probably thinking. Financial Horse has finally gone off the rafters. Bitcoin in his diversified portfolio alongside stocks, REITs, and bonds? What is this guy smoking?
Trust me, when I first heard about cryptocurrency, I thought it was absolutely ridiculous as well. A virtual currency administered via distributed ledger and not backed by any income stream, government or commodity? Why would anyone want that?
A lot of really important people, including Warren Buffet, JP Morgan’s Jamie Dimon (although he did regret making this statement later) and Bill Gates have all come out to state their belief that Bitcoin is a bubble. But there is an important disctinction between bitcoin and cryptocurrencies generally. Even if you think Amazon stock may be in a bubble, that does not necessarily mean that the stock market is overvalued.
The more I read about cryptocurrency, the more I came to …