The Bitcoin & Ethereum Show
I always say knowledge is the “new money.”
Knowledge does not go away, but stays with you and evolves with you. No one can take it from you.
I open here today, because we are seeing this at work right now.
Your money is being taken from you. As the Federal Reserve Bank keeps printing money, money becomes devalued. Is your paycheck going up to match the disappearing value?
Probably not. Your money is being stolen.
Banks are not giving any real interest rates. Taxes are getting higher and will continue to do so.
Your money is vanishing…but your knowledge is not.
Some of the people most respected in the finance world are finally seeing this and they are moving to cryptocurrency as one of their solutions.
I’m excited to discover I’m not the only person who recommends you invest in Bitcoin.
Paul Tudor Jones is a billionaire hedge fund manager. He’s pretty much the “top dog” in the game. He recently declared the cryptocurrency as the best hedge against inflation and compares investing in Bitcoin now to investing in early tech stocks, like Apple and Google.
To quote Paul Tudor Jones: “I think we are in the first inning of Bitcoin and it’s got a long way to go,” he said.
So it’s not just me. Cryptocurrencies appear to have just gained incredible acceptance into our society. Paul Tutor and I both see cryptocurrencies as a hedge against the cancerous dollar.
The beautiful thing about cryptocurrency is that it’s still in its infancy. And yes, just like infants it is often unpredictable.
If you understand the cycles, rhythms, and fundamentals of cryptocurrencies, then you can flourish from the volatility. Not only that, but you can flourish from the volatility that allows you to buy low and sell high over and over again. It’s a big reason why cryptocurrency can generate a fortune in a short period of time.
If I am predicting the future accurately, cryptocurrency isn’t an alternative investment or just a nice thing to have. It’s more than that. The proof is in the fact that it’s already replacing the dollar.
Take a look at what’s happening with currencies in Russia, China, and Venezuela. You may not know it, but it’s happening in every major country in the world. International banks have stopped sending digital dollars and have started sending cryptocurrency transfers, instead.
This means the dollar is already being replaced and no one knows it.
Why I love Cryptocurrencies
Gold became money as determined by the free market because of its properties—scarcity.
But with the invention of Bitcoin, we are now seeing a historical event that will never be repeated. What makes Bitcoin so special is that prior to Bitcoin there was no other form of money with its absolute limited supply.
Bitcoin’s characteristics make it a direct competitor to the central banks because of its absolute scarcity, resistance to theft and confiscation, and the system that it’s built upon prevents it from being shut down.
Why am I so interested in Bitcoin and cryptocurrencies? The same reason I love gold and silver. They free my money from State control.
I’ve heard so many opinions on the subject of cryptocurrency. For example, I’ve heard that Warren Buffet won’t touch Bitcoin. But, Buffet doesn’t touch gold either. And then there are guys like Ray Dalio and my good friend, Jim Rickards, who do not support Bitcoin and cryptocurrencies.
But, I noticed one thing, they’re all old guys.
I know there are three sides to every coin, the head, tail, and the edge. Wisdom is found on the edge.
On one side of the coin, we have the “old” guys who won’t even consider Bitcoin and cryptocurrencies.
On the other side of the same coin we have the younger guys, who don’t trust the system and the Federal Reserve and they will only invest and buy crypto.
My job is to stay on the edge, philosophically, and gain the knowledge both sides possess so I can strike and profit when the time is right.
So, on the edge, we just keep an open mind.
Bitcoin & Ethereum
In the cryptocurrency field, the two biggest players are Bitcoin and Ethereum.
Bitcoin is around $19k as I write this. It is the “king” in its space. It’s the original, it is expensive and it has very little practical use in the modern world.
It’s not really a currency as very few people can or do use it as money. It’s more like gold, you buy and hold.
Ethereum is very different from Bitcoin and very similar to silver. And it may be a great opportunity right now. Ethereum has so many similarities to silver. They are:
- Less glamorous than its big brother, Bitcoin.
- Has many practical uses
- Costs less than its big brother
- The upside appears to be huge
Pros and Cons of Bitcoin and Ethereum
Earlier this year, I interviewed Jeff Wang, a trusted crypto expert and he offered these pros and cons when considering investing in crypto:
- The U.S. Dollar experiences increased inflation pressures. This will cause Bitcoin and other crypto-assets likely to rise in value as capital flees to assets that will not lose value (also Bitcoin is historically negatively correlated with the dollar).
- Technology breakthroughs. Similar to how Ethereum 2.0 brings back spotlight projects that are more feasible on increased technology; however, even with other projects seemingly fixing a lot of scaling issues, we are not seeing a surge in product-market fit.
- Central Bank Digital Currencies become the norm. With so many countries relying on some form of blockchain to create their currencies, existing assets look more appealing as their technology is validated.
Possible negative factors
- Regulatory issues increase. Countries are starting to make sure there are laws to govern decentralized technologies. In a broader sense, there is a growing distrust of technology companies. Facebook, for example, is running into ad companies dropping out. In addition, India is looking to be more aggressive with the recent Tik Tok ban.
- A big market correction. This would have people take capital out of risky assets, including crypto, also why the market is tightly correlated to S&P 500, we are in a dangerous game of “what happens next”
- Crypto technology never reaches the mainstream market. Meaning, who cares? And then crypto loses relevance. That’s a very real risk, though the overall market currently looks optimistic.
Get Educated On Cryptocurrencies
Just as I mentioned above, cryptocurrencies are still technically in their infancy.
But as I see it, they have huge potential.
It is not luck that lets you win. It is education that propels your win.
Editor, Rich Dad Poor Dad Daily