Bitcoin: The 10x returns required and the 6.47% transaction fee

Bitcoin: The 10x returns required and the 6.47% fee

Can Bitcoin still change your life? That is the question driven by the promise of entering early and exiting a millionaire, but the fine print appears as soon as you look at the details. For a modest investment to make a difference, the cryptocurrency does not just need to rise: it needs to multiply tenfold. That is a different story when dealing with a thousand euros. And even then, it isn't free: paying at a real merchant can cost a 6.47% commission on a 100-euro card.

How much does Bitcoin need to rise to change your life?

You need more than a 10x, and achieving it is difficult. The calculation is simple: putting in 1,000 euros and waiting for a jackpot is not a plan; it is a lottery played against a chart. A 10x on a thousand euros is ten thousand; on ten thousand, it is a hundred thousand. None of this is achieved by waiting; it is achieved by timing the market.

The pattern described by those who have been in it for years is different. Every sharp drop attracts new money with the hope of a 10x. Months pass, the position remains at a 95% loss, a rebound arrives, money is reinvested, and the cycle repeats. According to this view, the market feeds on the illusion and the money of those who arrive late, while those who bought at the 2017 highs are still waiting to recover their investment.

Opposing this is the confidence of the believers: those who accumulate Bitcoin do so because they predict its value will rise despite short-term volatility. The rebuttal comes fast and sharp: a belief is not a forecast.

The real costs of paying with Bitcoin

Paying with Bitcoin at the corner supermarket has a cost. The most cited method is the Visa card issued by some exchanges, and the figure is striking: 6.47% for a 100-euro card. On a small receipt, it might seem like pocket change; repeated every week for years, it is not.

The second toll is in the exchange. To pay in euros, you must convert from cryptocurrency to fiat currency, and there, the exchange house's commission is added to the merchant's. In a stockbroker, by contrast, the operation is closed with 1 euro for buying and another for selling, regardless of the amount. Two models, two bills.

The full breakdown—card issuance, daily exchange rate, and withdrawal costs—is where the idea that Bitcoin is useful for buying groceries today falls apart. The calculation, transaction by transaction, is what unsettles those doing it for the first time.

From nearly 50,000 euros to 25,000: the price rollercoaster

The numbers driving the conversation paint three years of vertigo. In 2021, Bitcoin reached nearly 50,000 euros. In 2022, it fluctuated between 40,000 and 15,000. At the time of this exchange, it was trading around 25,000 euros. Those who bought at the peak hold a massive nominal loss; those who bought at the bottom hold a gain they probably haven't realized.

From this comes a repeated idea: the inflation of those who bought Bitcoin depends entirely on their entry date. It could have been 50% in euros, just with the sign reversed. Added to that is that every conversion pays its toll, so the comparison with a savings account is not as clean as it seems.

What supports the price: dividends, ETFs, and dedollarization

Here the tone changes. Bitcoin defenders do not talk about buying bread; they talk about a store of value and a hedge. They argue it serves to protect against a bank account freeze, that it moves on regulated platforms, and that managers like BlackRock are already working on a spot Bitcoin ETF. Dedollarization, they argue, pushes in the same direction. The references accompanying this argument point to economic and technology media.

The contrast with the traditional stock market is what bites the most. An IBM portfolio bought in early 2021 distributed more than 5% net in dividends each quarter, with the stock appreciating by over 50%, according to the case presented. The advantage is not just the yield: it is that you don't have to sell anything to collect. With Bitcoin, every expense forces you to unwind a position.

For those comparing, there is a more boring alternative with extremely low fees: an S&P 500 index fund. And the risk attributed to Bitcoin is specific: that a government considers mining to be polluting and bans it, or that a supervisor concludes it finances terrorism and closes the exchanges.

Illegal use and regulatory risk

The classic accusation is that Bitcoin is only useful for drugs, child prono, pirated software, and stolen goods. The response does not deny the use, but relativizes it: the dollar has been moving arms and drug trafficking for decades, and that, it is argued, is part of its acceptance and value. Bitcoin would be a more practical alternative to gold for the same and for everything else.

The serious risk, however, is not crime: it is regulation. That is where the asymmetry lies. If mining is prohibited or exchange houses are closed, liquidity dries up and the price has no known floor. That scenario is not ruled out, and if it were, the price would be very different.

In the end, there is a market that demands entering at the right time, enduring 95% drops, and paying commissions when exiting. Everyone will have Bitcoin at the price they deserve, says the industry proverb. What is fruta is that groceries are still bought with euros.