How many bitcoins would a Mega Moolah jackpot get you?
Imagine playing the Mega Moolah slot game and winning the Mega jackpot. Right now you would walk away with ten million British Pounds you didn't have when you woke up that morning. It happens to other people, so why not you?
Yet that leads to the question of what you would do with all that money. Buying bitcoin as an investment might be a good option for at least some of your winnings.
Bitcoin is one of a number of digital currencies, also known as cryptocurrencies, currently on the market. A lot of people purchase bitcoin as an investment first, then a way of completing financial transaction second. The volatile nature of cryptocurrency is such that an investment of Mega Moolah winnings could turn a millionaire into a billionaire.
So how many bitcoins would a Mega Moolah jackpot buy? That depends on the size of the jackpot and the trading price of bitcoin when the investment is made. At the time of this writing in the first week of August 2018, the Mega Moolah jackpot officially stands at £10 million and change, while the current price of bitcoin is £5463 (US$7073). That means you could buy roughly 1,829 bitcoin with that jackpot win.
How Bitcoin Works
Bitcoin is not a hard currency in the same sense as sterling or the US dollar is. It exists only as numbers in an electronic ledger known as blockchain, and that ledger exists on multiple computer nodes located around the world. When someone buys or sells bitcoin, the information is sent to the nodes for processing.
The computer nodes have to verify transactions by 'breaking the code' associated with each one to confirm its authenticity. Once that's done, the transaction is added to the end of the ledger. Once all nodes have verified and added a new transaction to the ledger, it becomes permanent.
One of the benefits of this kind of accounting system is that verified transactions are irreversible. Parties agree to transact business on their own terms, those transactions are added to the blockchain ledger, and they become a permanent part of the record that cannot be altered. This system mitigates the need for heavy-handed government regulation by employing an ironclad method of self-regulation.
Bitcoin as an Investment
Winning the Mega Moolah jackpot would likely result in a slew of financial advisers contacting you in hopes of helping you manage your money. It is probably safe to say that a fair number of them would recommend you put your winnings into traditional securities like stocks and bonds. Such securities are considered fairly stable and are highly regulated around the world. So even though you can lose your shirt on them, the chances of doing so are unlikely if your money is managed well. Having said that the markets look quite toppy at the moment. Even gurus like Dennis Gartman have recently said that stocks have hit a peak and it's time to hold cash. Perhaps bitcoin is today's perfect contrarian investment!
One of the things that makes crypto so attractive to so many people is the fact that the currencies existing under its umbrella are unregulated. Take bitcoin, for example. People buy and sell bitcoin mostly without interference from third-parties.
If you were to invest half of a Mega Moolah jackpot in bitcoin, you would be investing in a cryptocurrency that retains its value only as long as those who are part of the blockchain agree to that value. As such, bitcoin is highly volatile.
Making Millions from Bitcoin
To illustrate how investing in bitcoin could be a good move, let us assume you won the current Mega Moolah jackpot and invested half your winnings in bitcoin. We will round up and say that you've purchased 950 bitcoins. Let's say bitcoin increases eight percent in value today - which it often does. Your investment in bitcoin has just made a nice little profit in a single day.
Make profits like that regularly and you'll be laughing straight at the bank. But there is a catch: that same volatility that lends itself to sizeable gains can also lead to equally sizeable losses.
It Doesn't Take Much
The volatile nature of cryptocurrency is such that it doesn't take much to move prices. Early in 2017 the US Securities and Exchange Commission (SEC) rejected a proposal for a bitcoin-based exchange traded fund (ETF) based on the unregulated nature of cryptocurrency. The price of bitcoin fell to under US$1000 per coin on news of the decision. A lot of people took a financial hit as a result.
A few months later, the SEC agreed to review its decision. Bitcoin prices jumped roughly 163 percent as a result. Those who bought below US$1,000 and held on to their investments realised a very healthy return a few months later.
As you can see, the volatility of bitcoin is simultaneously its strongest and weakest point. Investing in bitcoin could make you tremendously wealthy one day and headed for the poor house the next day. The key to investing in cryptocurrency is knowing when to sell. You do not want to be part of a market panic that sends the price of bitcoin too low, but you also don't want to lose your entire investment should the bottom fall out.
The only way to do this is to follow crypto news and follow what the US SEC does in terms of the Winklevoss Bitcoin ETF. The next time the SEC make a decision on the ETF is 30 September 2018.
When It Makes Sense to Invest
All this talk about Mega Moolah winnings and investing in bitcoin now leads to the next question: whether it makes sense to invest some of your winnings in cryptocurrency. In a word, maybe. The first thing you would have to ask yourself is whether or not you have the stomach for high risk investments. As already demonstrated, bitcoin and other cryptocurrencies are highly volatile. You have to be able to withstand large fluctuations over short periods of time.
Assuming you can handle the risk, the next question is one of how much you are willing to lose. No financial adviser would recommend investing an entire £10 million jackpot in crypto. Few would even suggest investing half the winnings. But how about investigating 10 percent in crypto?
Certainly even if you did invest half in bitcoin you could live on the remaining half for the rest of your life as long as it was managed properly. So the half you choose to invest in bitcoin is disposable income, more or less. If that's how you see things, investing in crypto is probably not a bad choice. Bitcoin and its competitors have seen some significant drops over the years, but they have been on a steady upward trend for the most part.
How to Invest in Bitcoin
If you were to decide to invest half of your jackpot in bitcoin, you would start by signing up with one of the many crypto platforms out there. We will use Coinbase as an example. Coinbase would act as the bitcoin equivalent of a Forex broker. The platform acts as your intermediary for buying, storing, spending, and selling bitcoins.
With a Coinbase account established, you could purchase bitcoin by transferring cash from your bank account to your Coinbase account. Coinbase would then convert that cash into bitcoin while subtracting their fee from the total amount. Your bitcoins would be stored in a digital wallet that you would then use for financial transactions.
As long as you held onto the bitcoin, the total value of your account would rise or fall based on the value of the currency. You could use your bitcoin account to purchase other cryptocurrencies - like Bitcoin Cash, Ethereum, and Litecoin. Doing so is not a bad idea by the way. It is the cryptocurrency version of diversifying.
Meanwhile, the remainder of your jackpot could be invested in safer, low risk investments. You might put some into mutual funds and stocks, some into bonds, and the remainder into a retirement account. The amount invested in low risk opportunities provides the income that will pay your bills for the rest of your life. What you invested in bitcoin remains as an investment you are attempting to grow.
We would be remiss in an article of this nature not to close things out by encouraging readers to be careful with any and all investments they make. It would be easy to spend recklessly if you had the good fortune of winning the Mega Moolah jackpot. Let's face it; winning £10 million on an online slot could cause just about anyone to temporary lose perspective of the value of money.
The best move for that kind of money, at least in general, is to invest it. Investing does two things. First, it gives you the opportunity to grow your money over time. Second, it removes some of the temptation to spend recklessly. By taking the money out of your bank account and putting it into investments, it makes it a lot harder for you to spend without thinking about it.
Bitcoin could end up being a very good investment for someone who won a large amount of money. The growth of cryptocurrency has been steady and sure over the long term, and many experts say that cryptocurrencies are the wave of the future. Investing £5 million now could make you a billionaire in a few years.
Is it Possible to Play Mega Moolah with Bitcoin?
Byline: This article was published by Mega Moolah expert Henry. Media and other enquiries.
Next article: Can I play Mega Moolah with Bitcoin?