Member-only story
On May 22, 2010, a Floridian programmer named Laszlo Hanyecz made a post on the Bitcointalk forum offering 10,000 Bitcoins in exchange for someone ordering him two pizzas.
Jeremy Sturdivant (screen name: “jercos”) agreed to pay for the pizzas in exchange for the Bitcoin. The pizzas cost around $25. Today, those 10,000 Bitcoins would be worth around $700,000,000. That is a 28,000,000:1 return on investment.
Anyone would get FOMO thinking about that.
However, waiting for lightning to strike is not a good strategy for reliably building wealth as an investor.
Value Investing vs. Speculation
Until becoming well-versed in the philosophy of Value Investing, virtually everyone approaches finance as a speculator.
As Morgan Housel explains in The Psychology of Money, this is hard-wired into our instincts. We are drawn to the guessing game of speculation through our natural knack for pattern recognition. We look for ways of predicting the market’s next move, seeking reasons where there are only the emotional swings of Mr. Market.
Yes, a small few made a killing in the early days. But the odds of having been on the ground floor of Bitcoin are even lower than winning the lottery.
Wealth is built far more reliably by making smart investments in good assets, not by guessing the future.
