Every holiday conversation about cryptocurrency over the last few years boils down to one question: Should I buy some?
Whether your grandma corners you in the kitchen or your uncle nudges you during dinner, it seems everybody wants to know if they can make a quick buck off bitcoin. Hope springs eternal. As you settle in for the Thanksgiving weekend, you can welcome these inquiries because Quartz has you covered with an easy guide.
How’s bitcoin doing these days?
Tell your family: The market is bouncing back.
This year has been delightfully kind to bitcoin buyers, providing an 88% return year-to-date. If you bought one bitcoin on Jan. 1, 2019, your investment (of $3,750) would now be worth about $7,000.
Of course, that gamble would have peaked near $12,000 in August before tapering off rather dramatically. November, in particular, has been a tough month for the digital currency, with bitcoin falling to a six-month low.
Why the sudden drop in prices?
Tell your family: China is cracking down (again).
Some analysts have blamed the downturn on China, which—after briefly embracing blockchain—renewed its crackdown on cryptocurrency exchanges. Since late 2017, the country has officially banned crypto trading, but a thriving underground economy remains for over-the-counter, or person-to-person, swaps. China has expressed opposition to mining, the energy-intensive process used to confirm transactions and earn new bitcoin. (There’s also a chance the country could issue a digital yuan, but that remains to be seen.)
Do you think bitcoin will bounce back?
Tell your family: Most likely.
Yes. In crypto, volatility is the name of the game. If I were a betting man, I’d say bitcoin may even reach $20,000 again. The most enthusiastic crypto watchers are waiting for May 2020, when bitcoin’s issuance rate—the speed at which new units enter circulation—is expected to drop sharply. Currently, mining bitcoin provides a “block reward” of 12.5 bitcoins ($90,000). Soon enough…