Do I Buy Bitcoin or Gold?

An easy question, a hard answer.

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Do I Buy Bitcoin or Gold?

Everything looks very simple in the stock market.

There is always someone telling us how easy it is to make money with their investments. Yet the reality is that they keep working all day to pay their bills.

But anyway the stock market is easy.

Buy and sell. Two options. Nothing more.

Well actually you buy low and sell high. But the truth is that the complexity hidden within the market is infinite and surely this is exactly why we fall in love with it.

It is an unsolvable puzzle. A sea of data and numbers and money and lies and reports and magic tricks and smoke.

And this is what happened to me yesterday.

In a casual chat a friend asked me something.

Hey now that you mention it where should I invest…

In Gold or in Bitcoin?

Just like the market the question is easy. One or the other?

My friend was looking at me like… If you know so much then tell me! One or the other?

But as with any investment everything can get infinitely complicated and that is exactly what my head did.

I started seeing scenarios everywhere because there was a lot of information missing in that question.

• What portfolio does he have and how does it correlate with these options?

• Does he want to trade short term or medium term or long term?

• Will he be capable of holding through drops of 20% without selling or will he run away?

• Does he want to use leverage in the operation?

But I stopped.

I stopped all these automatic thoughts dead in their tracks. I remembered I was among friends so I gave my most sincere and simple answer possible.

For me today it is clear where to invest for the next 3 to 4 years between these two assets.

And today I am sharing it with you. In a plain an simple way.

But if you do not mind I will take advantage of the fact that you have a higher level to tell you the reason why.

Bitcoin

Since last August I warned that the $108,000 level could not be lost in Bitcoin or else we entered a bearish cycle and it was going to be hard.

I am not a guru nor do I have a crystal ball.

But I get informed and I dedicate a lot of time to understanding what a Halving is. I understand mining costs. I understand staking. I understand leverage. But above all I understand how all this leads us to CYCLES.

This chart is very powerful for understanding Bitcoin.

Each line is a cycle since its Halving. This event happens every 4 years.

The first cycle (the blue one) made the high somewhat earlier but the following cycles have made their highs at the same moment. All the lows have happened one year after reaching this high.

This last cycle (the strong yellow one) looks smaller and this is not a coincidence. Notice that each cycle is smaller than the previous one.

And this makes sense.

Bitcoin cycles are INFLATIONARY AND LOGARITHMIC.

Inflationary and logarithmic?

This is vital. Let me translate it for you.

Bitcoin should follow inflation because it is a finite asset like gold or real estate in certain areas.

Easy but logarithmic?

This is something that all crypto gurus hide from you or simply IGNORE.

Bitcoin cycles go up less every time.

One reason is that the more an asset capitalizes the more it costs to keep it going up. Money in the world is finite and therefore when something capitalizes billions it starts to be complicated to make it grow.

But you must also know that in the Halvings the rewards to miners are reduced.

At the beginning this meant a beastly reduction of many BTCs which drove the price very high. But now the reward is barely reduced by 1 BTC so the price cannot rise at the same pace.

If we pay attention to previous cycles Bitcoin will keep falling in 2026 until the end of the year before starting a recovery.

So much for Bitcoin theory so let us go to the practical part.

Where will this low happen?

I do not know and nobody knows but we have clues.

In each of the cycles we have seen the price retreat from highs. And a lot.

• The first cycle down 85%

• The second down 80%

• The third down 75%

And now?

Maybe 70%? It could be. It is just an approximation.

This last drop to $60,000 is already a great milestone as the price has corrected 50% but in previous cycles we see that the best is still to come. It can fall another 50% down to $30k or $40k to meet the levels close to 70% correction which would seem plausible based on previous behavior.

In terms of price it seems there is a gap to fill and in terms of time it is even better.

• Correction time of first cycle is 12 months

• Correction time of second cycle is 12 months

• Correction time of third cycle is 12 months

If this fourth cycle lasts the same as the previous ones we will be talking about seeing the moment of maximum pain in October 2026. That is the moment where we will all say that BTC is going to 0.

Who knows.

But with a theoretical $10,000 we could do this.

• Invest $5,000 in the zone of the previous peak at $60,000.

• Invest another $5,000 if the price gets close to the expected $40,000 zone by year end.

If all this happens as we expect we will have an average buy at $50,000.

After three years we should be at the next cycle peak which following a logarithmic progression could be somewhat higher than these last $120k.

Let us assume $150k. (Which is a number I get from the serie of previous rallies, but there is too much math for today)

We are talking about selling the investment for triple the price in 3 years. That is a return that is not bad at all.

The risk is total. I go without a Stop Loss. It is aspirational investment and in no case is it capital protection.

What if we buy gold?

We have all seen that gold is the new Bitcoin. It is capable of going up wildly in a few months and correcting it and recovering it and driving us all crazy.

But does it make sense to buy gold to seek returns in the next 3 years?

As always I do not have the crystal ball but we have clues.

Gold is not as shiny as you might think. Gold is a specialist in abandoning you for years to then give you the best in a very short time.

Since the gold standard was left behind it has moved with powerful rallies only to remain dormant for years.

After going up 446% it stopped for 4 years until it went up another 750%.

Then came a pause of 28 years where gold did not live its best moments only to wake up with a rally of 650% and go back to sleep for another 13 years.

And now we are in a rally. But rallies end, and in this asset when a rally ends it does so for real without looking back.

Where is gold now?

Gold has risen approximately 420% in this last rally.

I have marked this same level with a white circle in previous rallies.

As you see in all cases we are very close to the final zone.

Either we are facing a historic rally that will break any previous metric or we are reaching the end of a cycle that will leave us with several years of correction.

If in this same case we buy $10,000 and wait for the best scenario we can still see maybe 60% more upside from current prices.

But at the same time we have the zone of the expected next low further and further away. Seeing the behavior of this asset it is probable that we see that price meaning our upside potential is limited to a best case of 50% while we already have an almost assured 50% drop as well.

Determining where gold will turn around is incredibly complicated right now but seeing previous cycles it will be soon if we have not already lived its cycle high.

But then Gold or Bitcoin?

Let us not forget that all this was just to say one word to my friend.

He did not want to know all this but just one word.

For me there are two simple options.

• Buy Bitcoin knowing that with high probability starting from the end of the year you have a rally to double or triple the investment but assuming risk close to 100%. Ideally I would wait to have liquidity after the summer to take advantage of the panic moments that may exist.

• Buy gold for an upside potential limited to 50% and an almost certain correction of years and drops of at least another 50% when we return to the sideways phases of gold. But we will hardly see it fall beyond 60 to 70%.

Knowing that it was purely aspirational money where he could assume total risk, Bitcoin is offering us opportunities to achieve 3 times the risk even being 100% risk! Meanwhile gold offers us a risk return ratio of 1 to 1 with many options of getting stuck dormant.

For me with a 3 year view Bitcoin makes more sense right now.

Would you have recommended the same thing? I would love to hear from you :)

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