RE: The Ethereum Thread (the alt coin to Bitcoin)
Interesting Newsletter Info regarding Bitcoin and the Next Bitcoin (Ethereum)
Bitcoin at $10,000?
BY BILL BONNER, CHAIRMAN, BONNER & PARTNERS
BALTIMORE – We live in an age of miracles. With some paradox and claptrap thrown in for good measure.
Over the last four years, almost all the stock market gains in the U.S. came from just five technology stocks – Facebook, Apple, Microsoft, Amazon, and Google.
Those five have tripled in value since 2012. In this year alone, they have gone up, on average, 25%.
The Big Five
What has the rest of the market done?
Owen Williams, via The Gloom, Boom & Doom Report editor Marc Faber, took these top five stocks out of the S&P 500. This left him with the S&P 495.
How well has it done since 2012?
Well, it’s up about 25%… or about 5% a year. The Big Five, meanwhile, rose 226% – or about nine times as much.
These five companies are not priced so high because they are earning so much money. Most of the increase comes from “multiple expansion,” meaning investors are willing to pay more for each dollar of earnings they produce.
And if you put them together, says Williams, and figure out the price-to-earnings (P/E) ratio for the group, you get an incredible 59.4 times trailing net earnings – more than twice the P/E for the S&P 495.
Remarkable?
Then again, investors are lending money to the governments of Switzerland and Japan and paying for the privilege. And they’re also paying nearly $3,000 a pop for bitcoin – a crypto “currency” they can neither see nor hold in their hands nor (generally) use to pay for groceries.
So why shouldn’t they be willing to wait 60 years before their Big Five companies have earned enough to match their investment?
And what’s this? Another miracle!
On Friday, the Big Five began selling off. For example, Apple fell 6% from its peak.
Surely, there is another shoe still to drop in the tech sector. We wouldn’t be surprised if it had a steel toe… and went right through the floor.
Crypto Boom
In the meantime, we return to one of the wonders of our time: the aforementioned cryptocurrencies.
What your editor doesn’t know about cryptocurrencies includes most of what could be known on the subject. But he is surrounded by enthusiasts.
Word came last week that one of our former analysts is on Easy Street, prompting a comment from another young analyst in the office: “Oh, man… he made it big in bitcoin. Now he’s on an extended vacation in Fiji.
“This guy set up a bank of computers in our office in Buenos Aires when the government was keeping the price of electricity low. And he used them to ‘mine’ bitcoins. His computers solved the complex mathematical puzzles required to verify bitcoin transactions… and he got rewarded in new bitcoin in return.
“And that was when the price was in the pennies. Now we’re watching the price go up by more than $100 in a single day. I mean, it’s unbelievable. Did you know that just $1,000 worth of bitcoin in 2010 would be worth $90 million today?
“And bitcoin is not the only game in town. There are new initial coin offerings – or ICOs – almost every day. Basically, crypto startups are selling ‘crypto-tokens’ to raise money to fund their businesses – much like companies issue new stock to fund their businesses through IPOs, or initial public offerings. And not all of them are about currency or money.
“For example, there was recently an ICO for a company that allows you to rent out spare memory on your computer to people who need extra storage space. Another is trying to bring basic financial services to the 2.5 billion people around the world without bank accounts.
“And another ICO helped fund a company that allows you to get rid of all ads online and instead pay websites directly for their content. That one raised $36 million in just 30 seconds!
“There are over 800 cryptocurrencies now in existence. The one I like best is in the No. 2 position, Ethereum. It’s got nothing to do with currency at all. Basically, the developers behind Ethereum have created the first decentralized ‘world computer.’
“Businesses can use this decentralized computer to referee all kinds of global transactions without the need for a third party or centralized authority as arbiter.
“It’s like this ‘Galt’s Gulch’ in cyberspace – a place you can go to get away from corrupt institutions and do business without outside interference…”
Virtual Gold
“Of course, there are a lot of complete frauds, too,” continued our young analyst.
“When you get a sector this hot, the shysters get in on it. These are guys who sell mining companies in a gold boom… tech companies in a tech boom… and cryptocurrencies in a cryptocurrency boom.
“Is bitcoin in a bubble now? Maybe. I certainly wouldn’t be surprised to see prices crash again. But here’s the important thing. People said it was a bubble when bitcoin hit $1. They said it was a bubble when it hit $100… and again when it hit $1,000.
“Over the long haul, bitcoin – or some version of it – is here to stay. And it wouldn’t be surprising to see the price of bitcoin go to $5,000… or $10,000.
“Why? It’s a better form of money.
“Remember, the creator of bitcoin was a big fan of the gold standard. That’s what bitcoin is designed to be – virtual gold. It’s why the total supply of bitcoins is capped at 21 million. It has to be in finite supply, like gold, to have value.
“It’s also why you have to use lots of expensive processing power to ‘mine’ new coins. Unlike government fiat money, bitcoin is based on how gold was dug out of the ground at the cost to the owner of the mine.
“And if you’re in Venezuela with sky-high inflation… or in China with capital controls stopping you from moving your money overseas… or in India where the feds recently banned 86% of all banknotes in circulation… or in the U.S. with another financial crisis on the horizon… and you want to protect your wealth, you need real money.
“All the government has on offer is funny money. So what do you do? If you have the right contacts, you buy gold. Or you go online and buy bitcoin.
“Then you’ve got this digital currency that’s outside of the banking system… is immune from the next sovereign debt crisis… and goes up in value when bad stuff happens in the world.
“Of course, the authorities have already tried to outlaw… or control… cryptocurrencies. But it’s hard to control these things.
“First, they’re global and decentralized. So it doesn’t really matter what one government does. Second, they’re based on hardcore cryptography. That’s why they’re called cryptocurrencies. They’re not something governments even fully understand.”
Digital Referee
“We don’t know which cryptos will emerge as the Hertz and Avis of the sector. But there is no doubt that cryptos are here to stay.
“Because when you boil it all down, the technology that powers cryptocurrencies – the ‘blockchain’ – is trustable computing. It’s a technology that allows you to digitally referee win-win deals without the need for lawyers, central banks, financial middlemen, or government regulators.
“In fact, cryptocurrencies are an entirely new asset class. And right now, they represent just a tiny part of the financial ecosystem. But they are going to take over more and more of it.
“For example, bitcoin is more secure than any other form of money ever invented – even, you could argue, gold. Just look at what happened to the Incas, who saw all their gold looted by the Spanish. Or the British, who lost significant amounts of gold to German U-boats in World War I and World War II.
“This is the biggest change to money in probably 5,000 years… since gold was first used as money.
“You want to give your grandchild a cool present? Give him a crypto-coin. Better than a lottery ticket.”
Regards,
Signature
Bill Bonner
###
Why You Need to Care About Bitcoin
MARCH 25, 2017BILL BONNERBILL BONNER'S DIARY
Editor’s Note: Earlier this month, Palm Beach Letter editor Teeka Tiwari told you how cryptocurrencies like bitcoin are your best defense in the War on Cash. That essay was so popular that our own Chris Lowe caught up with Teeka to find out why Diary readers need to care about cryptocurrencies.
Chris Lowe (CL): Bitcoin has been going up steadily for the last three years. What is driving bitcoin higher?
Teeka Tiwari (TT): It’s that people are waking up to the idea that they can have control over the value of the currency they use. Right now, there’s a global currency war. Countries are debasing the buying power of their currencies to try to steal growth from one another.
On top of that, you have the War on Cash, which I know you’ve reported on extensively. It’s getting harder and harder to have private ownership of your money. Central banks do not respect private ownership of your cash. There is an increasing number of bans, like the one you saw in India last November. [Catch up here.]
Meanwhile, central banks are using tools such as negative interest rates to punish savers in the hope that they’ll rush out and spend their cash to avoid being penalized with a negative rate for saving it.
There’s a backlash to all that. People are saying, “Hey, this is my money. I want to be able to hold it anonymously. I want to be able to keep it a secret from the government. I want to be in complete control of my own capital.” Bitcoin gives you that control. Unlike any other asset or currency, bitcoin does that.
CL: We’ve written about cryptocurrencies a lot in Inner Circle. And the pushback we get in the mailbag is usually from folks who are worried that governments are not going to stand by and allow people to have that kind of control.
[Inner Circle is a weekly service that provides subscribers with concise analysis, strategic thinking, and investment research from around the Bonner & Partners network. Learn more here.]
Recently, we’ve seen China and Venezuela crack down on cryptocurrency exchanges. And Hawaii has stopped Coinbase, one of the main cryptocurrency exchanges, from operating in the state.
What do you say to people who say, “Look, this isn’t going to last. Governments are going to get wise to this. They’re going to crack down on bitcoin and other cryptocurrencies. And they’re going to lose a lot of value as a result”?
TT: Look, it’s still early days for cryptocurrencies. Bitcoin, the first cryptocurrency, went live in 2009. We’ll certainly have those fears coming to the market. And we’ll certainly have big price swings when a government official says something and, all of a sudden, people freak out.
But let’s talk about China… This year, the Chinese government started imposing all these different controls on bitcoin exchanges. They said, “You can’t pull your funds out. You have to start paying commissions. You have to start paying all these taxes.”
And initially, we did see a gigantic drop in the price of bitcoin as a result. It went from about $1,100 down to about $700. But guess what happened? We saw this almost immediate rally back up to new highs.
What this is saying is that people have had enough of governments telling them what to do. The beauty of bitcoin is that, unless you shut down the entire internet, you can’t kill bitcoin or any other distributed cryptocurrency. They’re impossible to kill because, by definition, the underlying records of the transactions – what’s known as the “blockchain” – are copied all over the internet.
That makes it incredibly difficult to regulate. Governments can try, but they’ll always fail. And of course, that terrifies regulators. Their inability to control these networks scares the heck out of them.
CL: So what’s going to happen now?
TT: At some point, they’ll just say, “Look, we can’t stop people from owning bitcoin. We can’t stop people from owning other cryptocurrencies, either. Let’s put in a regulatory framework that we can work with.”
Britain, Switzerland, and Australia, for instance, are taking more of that type of approach when it comes to dealing with cryptocurrencies.
CL: You’ve been jetting around the world to report on the rise of cryptocurrencies. You were in London last week at the Blockchain Expo event. Now you’re in Austin, Texas, at SXSW Interactive, another big cryptocurrency event. What’s the buzz around bitcoin and cryptocurrencies at these events? What should Diary readers have on their radars?
TT: People are, of course, very receptive to bitcoin. They’re very excited about cryptocurrencies. I’ve been focusing on companies that are using blockchains – the distrusted online ledgers at the heart of all cryptocurrency networks – to solve massive problems.
You see, there’s this new type of cryptocurrency. Actually, it’s not really a currency at all… it’s a “crypto-token.” It uses the same underlying technology as bitcoin. But instead of functioning as a currency, it’s more like a proxy for equity in a company.
This is the next exciting step in the evolution of cryptocurrencies and blockchain technology. These crypto-tokens were the big buzz in Austin. And they were the big buzz in London, too. I’ve been recommending some of these crypto-tokens to my Palm Beach Confidential subscribers, and they’ve been doing incredibly well. I think we’re going to continue to see more and more of that.
CL: Can you give us some examples of the types of problems these new companies are helping to solve?
TT: For instance, tampering with bank records. We recently had the problem with Wells Fargo going back and changing mortgage records. Then we had something called “robo-signing.” Banks were basically forging affidavits and forcing people out of homes they had already paid for. This happened because there’s no easy way of creating a tamper-proof audit trail in these big banks.
But I visited somebody down here in Austin yesterday who has created a solution. Using blockchain technology, you can create an immutable chain of records that will immediately tell when something’s been tampered with. Within minutes of somebody tampering with a file, a compliance guy will get an alert saying, “Hey, someone’s just changed something when they shouldn’t have.”
Now, to give you an idea of how big this compliance market is, trade magazine Compliance Week estimates that about $1.3 trillion a year is spent on securing documents.
This is a huge, huge market. And it’s ripe for disruption… and ripe for the blockchain.
The really amazing thing is that this new company is stepping into this huge market by totally bypassing the stock market. It’s going out and solving this huge global problem. And it’s issuing crypto-tokens instead of stocks or bonds to fund itself.
CL: So instead of a business owner floating his company on the stock market, as we’re used to, he just issues crypto-tokens. How do our members participate? Where should people be reading more about this?
TT: CoinDesk.com is a great resource to read about different projects that are coming out.
CL: Where do these crypto-tokens trade?
TT: They trade on cryptocurrency exchanges. Some of the biggest are Kraken, Poloniex, and Bittrex.
These are non-traditional exchanges. They’re not like the New York Stock Exchange. These are the new stock markets, if you will, that are springing up to fill the void for this new form of share issuance that I call a crypto-token.
CL: Final question: What’s the simplest way for Diary readers to participate in the cryptocurrency boom?
TT: Buy bitcoin.
Today, more than 100,000 merchants accept bitcoin as payment, including Overstock.com, Cisco, Walmart, Starbucks, and Microsoft.
Think of bitcoin as the reserve currency of all cryptocurrencies. Just as the values of other fiat currencies are measured against the reserve currency of the dollar, the values of other cryptocurrencies are measured against bitcoin.
Also, you can’t just swap your dollars, euro, or yen directly to buy other cryptocurrencies. Often, you need to first swap your dollars for bitcoins… and then exchange your bitcoins for other cryptocurrencies.
Bitcoin’s “reserve” status means it deserves a home in your portfolio.
Editor’s Note: Early investors in bitcoin saw incredible gains in the span of a few months. In 2013 alone, bitcoin shot up 8,536%.
We mention this because Teeka just revealed a new cryptocurrency that he believes could be “the next bitcoin.”
Already, this cryptocurrency has shot up 1,000% in 2017 and been tested by 11 different banks as well as IBM and Microsoft. Teeka believes this new cryptocurrency could soon see bitcoin-like gains in the coming months.
[Hint: Ethereum]
The Next Bitcoin Transcript:
BRIEF: In 2013, Bitcoin made headlines as it went from $13 to $1,147 (an extraordinary 8,526% gain). Now, a former Bitcoin developer has started a rival currency that’s gone up 1,000% this year. Already, Microsoft, IBM, and 11 banks (including Wells Fargo) have tested it. “A new virtual gold rush is underway,” reports the New York Times.
By Teeka Tiwari, Editor, Palm Beach letter | April 28, 2016
He’s been called autistic, a prodigy and even the next Steve Jobs.
But whatever he is, Vitalik Buterin, a Canadian programmer now living in Switzerland, has just developed a secret “currency alternative” that could let early investors turn every $200 placement into a rare, once-in-a-lifetime return of $6,850.
You see, Vitalik Buterin isn’t your average 22-year-old.
Vitalik Buterin—
The Next Steve Jobs?
In 2013, Buterin took a page out of the Steve Jobs playbook and dropped out of college.
A year later, he won a $100,000 fellowship from billionaire PayPal co-founder Peter Thiel. Then he went on to win a “World Technology Award,” beating out Facebook’s Mark Zuckerberg.
But despite these achievements, Buterin has remained largely unknown.
That could soon change thanks to a groundbreaking announcement Microsoft just made…
You see, eighteen months ago, Buterin came up with a novel way to improve Bitcoin, the popular digital currency that lets people buy things (and exchange funds) anonymously—without relying on any government or Central Bank-printed money.
Bitcoin went mainstream in 2013 when it shot up an incredible 8,526% in 11 months, going from $13 to $1,157 a “coin”.
The meteoric rise was fueled by the economic crisis in Cyprus, when the country confiscated as much as 47% of people’s wealth via their so-called “bail ins.”
As a result, people scurried to move their money outside traditional currencies.
Bitcoin soared. And a new class of millionaires was created.
“It’s a bit surreal,” writes Robert S., one of the new self-described “Bitcoin Millionaires.”
“I have used a small portion of my holdings to buy a small house,” writes another one.
The “Bitcoin Porsche”
Once an underground currency, Bitcoin is now accepted by over 100,000 merchants worldwide, including Amazon, Target, CVS and Subway.
People can even buy groceries and cars with it.
In fact, according to Business Insider, a businessman in Texas parlayed a Bitcoin “starting stake” of $1,200 into a $39,000 Porsche.
“I think it’s fantastic,” said 12-term Congressman Ron Paul.
It’s “better than currency,” declared Bill Gates.
And billionaire Richard Branson added, “People have made fortunes (with Bitcoin),” but also cautioned “there will be other currencies like it that may
be even better.”
That is precisely what many people believe the young Canadian has just found.
3,900% Better than Bitcoin?
You see, while Bitcoin has gained a large following, it has failed to make substantial in-roads with major financial institutions.
Buterin’s new currency, on the other hand, has already been tested by 11 major banks around the world.
Wells Fargo, Barclays, BMO, Credit Suisse, Natixis, HSBC, TD Bank, RBS, UBS, Unicredit and the Commonwealth Bank of Australia have all given it a try.
And another 31 banks, including J.P. Morgan, Bank of America, and Citibank are looking into it.
“This is a very exciting development,” said David Rutter, the man in charge of the banking project.
Tech giants have also joined in, with IBM, Samsung, and Microsoft all setting up recent partnerships with Buterin.
According to Marley Gray, Microsoft’s Director of Business Development, a big reason companies are choosing Buterin’s technology is because it’s 40 times faster than Bitcoin.
40 times faster.
What does that mean?
Well, say you want to cash in a check at a bank.
As you know, it can take anywhere from 3 to 5 days for that check to clear.
That’s because the way our current banking system is set up.
It’s essentially using “old plumbing.”
With digital currencies, however, it doesn’t take nearly as long for money to clear.
For Bitcoin, it takes 10 minutes.
But with Buterin’s new currency, the same transaction takes less than 15 seconds.
It’s almost instantaneous.
That’s why everyone is jumping all over this—Speed is king. And for these billion-dollar companies, minutes matter.
In fact, even the $2 trillion Toronto Stock Exchange is looking into Buterin’s currency.
“It’s exciting,” says Anthony Di Iorio, the exchange’s Chief Digital Officer.
And Tom Dyson, an investment analyst who turned an early $25,000 stake in Bitcoin into nearly $536,000, declared “This is the next Bitcoin. You got to buy it.”
Google confirms Buterin’s “Super Currency” expolding in popularity
But Tom and Anthony aren’t the only ones excited.
Google has been tracking “the next Bitcoin” for months now. And, just recently, one of their algorithms indicated a major spike in the currency’s popularity.
I flew to Austin, Texas to find out what was going on.
Caterina Rindo, a top consultant in the digital currency space, was presenting at the SXSW (South by Southwest) conference.
Rindo told me there’s been a recent shift within the community away from Bitcoin and towards “the next Bitcoin.”
Switching Sides…
In fact, at a recent New York City “hackathon” (this is where many of the world’s best programmers compete on new technologies) 86% of programmers chose to work on Buterin’s new currency over Bitcoin.
This is significant!
You see, a large part of a new technology’s success has to do with the early adapters and developers.
Take Apple.
The company wouldn’t be anywhere near where it is today if it hadn’t been for hordes of die-hard fans and developers—many of whom worked for free—who improved the technology over the years.
[As an aside, that’s one of the reasons I recommended Apple to the clients of my hedge fund 13 years ago. The company was selling for only 2% of what it trades at today, and many thought it was “dead.” But their mass following wasn’t going to let the company go broke.]
Buterin, like Jobs, is quickly developing a “cult-like” following.
In fact, even though only started his project in late 2014, more than 38,779 individuals around the world have already signed up to attend local workshops to learn more about—and help support—Buterin’s new currency.
Gaining momentum: As of April 4, 2016 over 38,779 people have signed on to help advance “the next Bitcoin.”
As a result, the price of “the next Bitcoin” has started to go parabolic…
On January 1st, you could buy it for $0.93…
But by March 13th it had shot all the way up to $13.92, an increase of 1,396%.
That would have transformed a $200 stake into $2,792. And $500 into $6,980.
Wall Street insiders have started to take notice…
According to the New York Times, Michael Novogratz, who managed $2.3 billion at Fortress Investing Group and helped lead Fortress’s initial investment in Bitcoin, reports he just made a “significant” purchase in “the next Bitcoin.”
That’s why I rushed to get out this alert.
Because it’s still early days for “the next Bitcoin.”
But that won’t last long…
With Microsoft’s recent announcement (which I’ll discuss in a minute), it wouldn’t surprise me to see the currency hit triple digits before the year is out.
Too Late?
Now, given the recent price explosion, you might be wondering…
“Isn’t it already “too late” to buy the next Bitcoin?”
That’s a great question.
But let me answer this question with another one:
Before today, had you ever heard of Vitalik Buterin?
Unless you’re really tuned into the cryptocurrency space, I’m willing to bet the answer is no.
But on the other side, everyone has heard of Bitcoin.
And that’s the key difference.
You see, every new disruptive technology–whether it’s Bitcoin, Uber or Facebook–goes through the same basic adoption cycle.
Innovation Adoption Lifecycle
First, you have the innovators. These are the people (or the individual) who start the new technology.
Then you have the early adopters…
Followed by the early majority…
And the late majority.
Finally, you have the “laggards,” the last group of people to adopt a particular technology.
When you stop and think about it, it makes sense.
Take Facebook.
In the beginning, only a few students at Harvard knew about it…
Then it moved to all Ivy League colleges. Then all colleges in North America.
And before you knew it, it seemed like all the world was on Facebook. Your mother, brother, dad. All your high school friends, too.
As the company grew viral and more and more people discovered it, Facebook’s value exploded.
A similar type of thing happened to Bitcoin in 2013.
Look…
The “Media Effect’
Here’s an image that illustrates the price of Bitcoin (in red) along with some key media articles that appeared about the currency (the black dots) from 2011-2013.
As you can see, as 2013 rolled around, it seemed like everyone was talking about Bitcoin.
Forbes…
Fox…
Fortune…
Bloomberg…
BBC News…
CNN…
CNBC…
NPR…
Popular Mechanics…
The Financial times…
The New York Times…
The Guardian…
Scientific American…
Slate…
Wired…
The Washington Post…
And that’s just a small sample size!
As the pace of these articles increased, awareness about the new “digital currency” grew.
And Bitcoin experienced a similar phenomenon as Facebook:
Its price blew up.
On January 1st, 2013 you could buy a single Bitcoin for $13.
But as the currency went “viral,” Bitcoin’s price sprinted past $1,157—almost topping the price of an ounce gold.
Now, a similar “media effect” is starting to take shape with Buterin’s new currency…
Rush
You see, just like its predecessor in early 2013, “the next Bitcoin” is currently trading in the $10-$15 range.
And, just like Bitcoin, major news outlets are starting to pick up on the story.
In fact, on January 20th, 2016, the Wall Street Journal featured a short article about “the next Bitcoin.”
Then on March 28th, the New York Times followed suite (although they dubbed it “Bitcoin 2.0”).
Four days later, CNBC published a story too...
That’s why Greg, Tim, and David, three researchers who helped me uncover this story, are all rushing to buy “the next Bitcoin”…
Greg was the first one to test it out with a small $100 “starting stake”…
Tim, who still regrets not buying Bitcoin when he first heard about it years ago, is planning a $500 purchase.
And David, who was initially skeptical, has invested more than $1,200. He tells me what changed his mind was talking to his friend in Silicon Valley…
His friend—who has a Ph.D. in Physics and currently works for a startup that got acquired last year for over $300 million—had just only heard about “the next Bitcoin” a week before.
And he, too, was getting ready to buy it.
As David told me, “Who knows? If these guys are just starting to invest, this could be my one chance to get rich.”
A Key Difference…
Now, I can’t tell whether or not David will get rich.
But he does bring up an interesting point.
And that is:
Normally, Silicon Valley insiders have a huge advantage when it comes to investing in new technologies like this.
The fact is, unless you’re a big name Venture Capitalist you’re pretty much closed off.
The only chance the average guy gets to invest is once a company goes public—after all the upside has been squeezed out.
Let’s take Facebook again.
From the time it went public to today, your money would have gone up 250%.
Not bad.
But look at this…
Peter Thiel, the billionaire who awarded Buterin a $100,000 fellowship. Well, he turned an initial investment of $500,000 into more than $1 billion!
Even if you just invested $200 you’d still have made out like a bandit, collecting north of $400,000.
That’s enough for some people to retire on.
But, of course, you weren’t offered that opportunity.
That’s because the SEC prevents most people from buying into companies that “haven’t gone public” yet.
Let’s look at another example.
Uber.
This company has totally disrupted an entire industry.
In India, taxi unions went on strike.
In Boston, they tried to ban it.
But despite all this opposition, Uber rides on. And is now worth a reported $62.5 billion.
It’s a great story.
One many wish they could invest in.
But sadly, they can’t.
That’s why “the next Bitcoin” is so exciting…
You see, even though “the next Bitcoin” is a groundbreaking new technology (remember, that’s why Microsoft, IBM, Samsung and all the big banks are all falling over themselves to get involved)…
Because we’re investing in a currency and NOT a stock… we get to invest right alongside all the top dogs in the “Valley” and Wall Street!
In other words…
While the average investor has to contend himself with low- to no-yield options such as bonds, bank accounts and “post-IPO” public stocks…
With “the next Bitcoin,” you have the opportunity to get “pre-IPO” private type gains—without having to be an accredited investor!
Speaking, of which, you’re probably curious…
Just how high could “the next Bitcoin” go?
Upside
Well, unfortunately, since digital currencies didn’t exist before 2009, they’re a bit difficult to evaluate.
You see, although there are over 600 different digital currencies in the world right now, most are worthless.
“The next Bitcoin,” on the other hand, is already worth at almost $1 billion—more than the total GDP of at least 15 different currencies.
Together, Bitcoin and “the next Bitcoin” own over 90% of the digital currency space.
So they’re in a class of their own.
That’s why the best predictor for the price of “the next Bitcoin” is looking at (the old) Bitcoin.
Here’s what that could look like…
For example, if “the next Bitcoin” matches Bitcoin’s current price of about $420, that would be enough to turn $200 into $6,848… and transform a $500 stake into $17,121.
And if “the next Bitcoin” reaches Bitcoin’s record price of $1,157, then your cash would get multiplied 94 times over.
$200 would become $18,936.
And a small starting stake of $500 would transform into $47,340.
It’s enough to make anyone start dreaming.
Now, of course, nobody holds a crystal ball. And there’s going to be risk in any sort of groundbreaking disruptor like “the next Bitcoin.”
But what we do know is this: “The next Bitcoin” is primed to take big chunks out of big markets.
For example, consider the recent report from the global consulting firm Deloitte.
They estimate payments made with digital payment systems like “the next Bitcoin” could rival the $26 trillion “payment processing” market of the Automated Clearing House by 2025.
(The ACH is a financial network that processes mortgage loans, insurance premiums and other payments.)
Even if “the next Bitcoin” captures just 1% of that volume, it would be enough to increase its circulation by 27,045%.
In fact, according to Deloitte, the technology behind “the next Bitcoin” is “possibly the most disruptive of all” technologies!
But while no one can predict the exact top, we know once a digital currency’s price starts moving, things happen very fast…
Take a look.
“I Quit”
In February of 2013, a man (who preferred to remain anonymous but I’ll call Bill) started chronicling his “Bitcoin journey” online.
“I am not a wealthy man,” Bill said. “I am actually quite poor and have a lot of student loan debt.”
But despite this, Bill had good credit. So he applied for—and received—over $30,000 in credit cards.
The Bitcoin “New Rich” Share Their Tales…
“I’ve cashed out at $130K”
— Jeremy P.
“When bitcoin passed 105, yes I became a bitcoin millionaire”
— Lee W.
“Invested back when Bitcoin was at $15. Already seen my investment appreciate 700%”
— Hillary C.
“I hold just under $10 million in BTC (Bitcoin)”
— Jake F.
“I found out today I’m a BitCoin millionaire!”
— Jake F.
“I'm at a solid 1.4 mill... This is the gold rush of our time and those who are doubting will be left in the dust!”
— Paul C.
“Thank you bitcoin! You changed my life”
— Albert B.
Source: Reddit
He then decided to invest the entire amount in Bitcoin!
At the time, Bitcoin was trading between $14 and $25.
Then, on April 9th, less than 2 months after his first purchase, Bitcoin soared to $195…
So here’s what Bill did. He took out his initial $30,000 stake, paid off his student loans, and let his profits ride…
Then, a month later, he quit his job.
In December Bill wrote he’d sold some coins for “between $1,000 and $1,130”—nearly 100 times his initial investment!
All of this happened in less than 10 months.
Like I said, these things happen fast.
All it takes is a trigger.
It doesn’t have to be much.
For Bitcoin, it was Cyprus. A small Mediterranean country most people had never heard of before.
But that was enough.
The world today is still (if not more) messed up than ever.
Dozens of countries face severe debt crises.
Who will be the next Cyprus?
That’s why it’s not too hard to imagine what could ignite “the next Bitcoin” soon…
Trigger #1
The first potential trigger is the “war on cash.”
Right now, countries around the world are limiting how much cash you can use to (legally) buy things.
In Spain, for example, you can’t use cash to buy something that costs more than 2,500 euros…
In Italy, the limit is 1,000 euros…
And, in France, it used to be 3,000 euros… but that recently changed to 1,000 euros.
Some countries even want to ban cash altogether!
Sweden, Norway and England have all tabled plans to do that.
The reason nations want to do this is clear: Less physical cash equals more tax revenue.
The IRS, for example, estimates it would earn an extra $450 billion in taxes if cash was outlawed.
Now, can you imagine what would happen to “the next Bitcoin” if England goes through with their plan?
Just think: England’s population is 50 times bigger than Cyprus!
Trigger #2
The second potential trigger is negative interest rates.
I’m guessing you’ve heard of this before. It’s all the rage with central bankers right now in their never-ending quest to “stimulate” the economy.
Here’s how this works…
Let’s say you’ve got $10,000 sitting in a bank.
Twenty years ago, you might have got 5-6% on that money.
Today, of course, you get nothing.
But just wait ‘til tomorrow…
You might have to pay for the privilege of keeping your money in a bank!
In fact, according to JP Morgan, interest rates could reach -4.5%. That means you’d have to pay $450 (each year) just to keep $10K in the bank.
Negative interest rates cause safes to sell out in Japan
Sounds like science fiction, only it isn’t.
The European Central Bank, for example, has already set its interest rate at -0.4%.
Denmark, Switzerland and Japan have all implemented negative rates too.
In fact, when the Bank of Japan announced a negative interest rate of just -0.1% this year, sales of safes went through the roof!
The Wall Street Journal reports a $700 model completely sold out in a Tokyo store.
What happens when Japan sets their rates to -1%... -2%... or even lower?
This could actually be part of the reason “the next Bitcoin’s” price has surged of late…
Trigger #3
(America is Not Safe, Either…)
Next up is America.
Now, as we’ve seen, nothing needs to happen in the U.S. for “the next Bitcoin’s” price to skyrocket.
And yet, it’s important to note we’re not immune from all the craziness going on.
Take Larry Summers, for example.
The former U.S. Secretary of the Treasury has publically stated we should ban the $100 bill.
And, thanks to law R.S. 37:1866, it’s already illegal to make certain cash purchases in Louisiana!
Even Janet Yellen is on record saying negative interest rates could be “on the table” for the Federal Reserve.
As Americans, we value our freedom more than anyone else.
What do you think will happen if the next President decides to ban the $100 bill? Or, if we have to start paying banks 2-3% just to keep our money there?
“The next Bitcoin” will go through the roof.
Now, I understand if you think this all sounds crazy.
And I agree.
But let’s not forget…
Gold was actually banned here in America for 41 years, from 1934 to 1975.
They say history doesn’t repeat but it often does rhyme.
Action Plan
For all these reasons, I believe it’s important to take action today.
We can’t change what our crazy governments are doing. But we can change what we’re doing to protect ourselves.
The simple fact is: more and more people are moving their money outside traditional currencies.
Naturally, some of this money is finding its way into gold and silver. (And, yes, I recommend you hold a part of your money here too.)
But a surprisingly large part of the “currency exodus”—over $8 billion, to be exact—is finding its way into digital currencies like Bitcoin and “the next Bitcoin.”
As Currency Wars author Jim Rickards says, people “are looking for alternatives.”
With “the next Bitcoin,” your money is NOT controlled by any government or central bank…
…the supply (and its growth) is limited…
…and you can choose to remain anonymous.
That’s why Bitcoin soared.
And that’s why I believe “the next Bitcoin” will soon hand investors life-changing gains.
The Biggest One?
In fact, I haven’t even mentioned the fourth (and possibly biggest) trigger for this new currency.
And that is:
On March 30th, Microsoft made a huge announcement—They will soon let over 3 million of their developers work on “the next Bitcoin” through their Windows platform.
This is massive!
By one measure, that’s over 19 times the developers working on Bitcoin.
As one “next Bitcoin” enthusiast noted, it’s like “Bitcoin on steroids.”
And as another noted, “I am beginning to doubt how bitcoin will manage to stay ahead.”
So here’s what you need to do:
I’m issuing a strong “buy” recommendation for “the next Bitcoin.”
Now, because this currency is newer, I must warn you, it’s not as easy as buying a stock.
(That’s part of the reason its price hasn’t reached Bitcoin-like levels too.)
A lot of the information out there right now is, quite frankly, very confusing. And even potentially dangerous.
That’s why my staff of researchers and I have been investigating this currency for several months now.
We’ve just put out what I believe to be the only definite guide on the simplest, easiest and safest way to buy “the next Bitcoin,” as well as how to maximize your profits.
It’s called Life-Changing Gains: How to Profit from The Next Bitcoin.
In this report, we’ll show you (with the help of screenshots anyone can read and understand) the three exact steps you need to take to buy this currency right now—straight from your home computer.
We’ll also share:
A unique loophole we’ve found that lets you do “one step purchases” from 38 different states…
We’ll show you how you can actually collect “the next Bitcoin” for free. (One man, for example, used this secret to earn over $7,000,000 in free Bitcoin in a single month!)
The single best “wallet” to safeguard your new currency in…
And we’ll also share with you the best strategy to determine exactly how much money you should put into “the next Bitcoin.”
You see, here’s the thing…
The Most Important Investing Concept Most People Don’t Know…
There’s a very important concept most investors have never heard about.
It’s called “asymmetry” and it lets you receive outsized-type gains without taking on huge risks with your money.
Now, that may sound counter-intuitive, and it is… but elite hedge fund managers in Manhattan and big names in Silicon Valley use this technique all the time.
In my 25+ years in the investment game, “the next Bitcoin” is perhaps the best example of an asymmetric bet I’ve ever found…
You see, it’s all about risk and reward.
Look at the chart on the right.
It shows the potential outcomes for my researcher Tim’s $500 investment in “the next Bitcoin.”
What’s the downside?
Well, let’s say, for example, that Microsoft, IBM, Samsung, and 41 big banks are 100% dead wrong and “the next Bitcoin” and it plunges all the way down to zero.
What happens?
Tim lost $500.
It sucks. But it’s a loss Tim can stomach.
On the other hand, what if Tim and all these billion-dollar companies are right?
Well, let’s not even assume “the next Bitcoin” does better than Bitcoin (which seems very possible given all the backing it has and the $26 trillion market it’s about to disrupt)…
But let’s just say, instead, that it simply matches what Bitcoin has done in the past…
Well, in that case, a $500 “starting stake” transforms into $46,840.
Even if it only does 10% as well as Bitcoin, you’ve still multiplied your money almost ten times.
Do you see how powerful this is?
It’s how fund manager Kyle Bass, for example, made 650 times his money by betting on Greece a few years ago… and how Peter Thiel made 2,000 times his money on Facebook.
Compare that to how most people invest.
Now, of course, the key here is position size.
Don’t bet the farm.
That way, you only have a small loss if you’re wrong. But you get lottery-like returns if you’re right.
Put this $100 in “the Next Bitcoin” and Thank Me Later.
As I mentioned, all the information on how to get started with “the next Bitcoin” can be found in our new report, Life-Changing Gains: How to Profit from The Next Bitcoin.
However, this report is not for sale for any price.
You can’t find it on newsstands, bookstores, on any website—and I’m not selling it to any hedge funds managers, either.
It is reserved exclusively for readers of my Palm Beach Letter monthly research service.
This is where I send over 100,000 people around the world a 10-20 page report each month on the best investment opportunities I see, based on my 25+ years’ experience in the business.
I’ve had some huge winners in the past, but I believe my biggest winner of all will be “the next Bitcoin”…
That’s why I want to put our new report in your hands right now, for free.
All you need to do is sign up for a one-year trial of the Palm Beach Letter.
As a new member, I’ll immediately rush Life-Changing Gains: How to Profit from The Next Bitcoin your way.
And, on top of that, I’ve also figured out a way to “fund” a small starting stake of $100 for you in “the next Bitcoin”…
You see, for the first 500 people who reply today, we’re decided to take $100 off the subscription fee.
Of course, you can do whatever you want with those savings. But I suggest you can take this money and invest it directly into “the next Bitcoin.”
That way, if this new currency goes on to match Bitcoin’s current price this small starting stake could be worth north of $3,460.
Not a bad little freebie!
But, again, we have to limit this special offer to only the first 500 people who sign up today on a first come, first serve basis.
(This is because we want to make sure we’re not affecting the price of “the next Bitcoin”—we want to monitor this closely…)
To get your copy of Life-Changing Gains: How to Profit from The Next Bitcoin and claim your “$100 starting stake,” simply click here to get started.
In 1991, I bought Oracle and Microsoft in my retirement account.
But then there was a sudden back office “snafu,” and both stocks were mistakenly sold out of my account.
By the time I was told about this, the stocks had risen slightly. I kept telling myself I'd buy them back later...
Of course, I never did.
From 1991 MSFT rose from a split-adjusted price of $1.30 to $55. And Oracle rose from $0.20 (split adjusted) to $40, a potential 20,000% gain I missed out on.
The moral of the story is obvious:
The only way to profit from an opportunity is to act on it.
We’re all busy.
And there’s “always tomorrow.”
But, sadly, the investment world has a tendency to move on without us.
Right now “the next Bitcoin” is like a stack of dynamite ready to explode.
41 banks are considering it.
IBM, Samsung and Microsoft have just bought in (with Microsoft giving the green light to 3,000,000 developers to work on it).
And Wall Street, Silicon Valley and the media are just NOW starting to pick up on this story…
The fuse has been lit.
How long before it explodes?
To claim your free copy of Life-Changing Gains: How to Profit from The Next Bitcoin and your “$100 starting stake,” just click on the link below.
By Teeka Tiwari, Editor, Palm Beach Letter | April 29, 2016
NOTE: I am heading to the world’s biggest event on digital currencies next month in New York. I’ll be sending my updates on this—including what lies ahead for “the next Bitcoin”—to all my Palm Beach Letter readers as soon as I get back. Remember, by signing up today for a 1-year trial, not only will you get a free complimentary copy of Life-Changing Gains: How to Profit from The Next Bitcoin… but (for the first 500) you’ll also be able to claim your $100 starting stake.
By Teeka Tiwari, Editor, Palm Beach Letter | May 3, 2016
UPDATE: I have received a lot of questions since publishing this alert a few days ago. A lot of excitement, but some people want clarity. To that end, here’s a list of the most common questions about “the next Bitcoin.”
Your Questions Answered
Question #1: Why are digital currencies worth money?
Money is one of the most confounding concepts on earth. We all use it. But who really understands it?
The truth is: money can be anything.
In the past, seashells, salt, rice, barley—even silk—have been used as money. In essence, all you need is something that makes it easier for people to transact business between each other.
Take the U.S. dollar. There’s nothing backing it up—we went off the gold standard in 1971. So all the dollar really is is a promise… an “act of faith.”
We’re all acting on faith that—by accepting these small pieces of paper we call “money”— we’ll, in turn, be able to use them to buy other stuff in the future.
A digital currency is no different.
It’s simply a medium of exchange many people around the world have decided is money. They believe they’ll be able to use Bitcoin and “the next Bitcoin” in the future to buy other stuff with it. That alone makes it have value.
Question #2: OK, but why are people picking this vs. the dollar… or even gold?
As ex-Congressman and libertarian kingpin Ron Paul said, digital currencies are “commodities that offer better value than what the Fed is printing.”
You see, people mistrust the government. They’ve seen our debt skyrocket to unmanageable levels. They’ve seen what happens in Cyprus. I believe that’s why “anti-establishment” candidates Bernie Sanders and Donald Trump are garnering so much support.
I mean, think about it:
The U.S. dollar has lost more than 95% of its value in the last 100 years.
Every time a government prints money, it dilutes the value of each dollar.
With a digital currency like “the next Bitcoin,” your money is NOT controlled by a central bank like the Fed. They cannot be diluted. They have a set schedule of how they are released and they have a finite supply. They’re not going to “print” a trillion units of the currency next year.
Thanks to something called “decentralization” (which I’ll get into in the next question) it’s also a lot safer since the value of the money is dictated by the market place and NOT a Central Bank.
Now as to gold… I know it seems baffling Bitcoin was once almost worth a single ounce of gold.
However, keep in mind…
Gold was confiscated in the past. And also: It’s a lot easier to send around money from America to Australia with a single click of the mouse, for example, than it is to lug around ounces of gold 10,000 miles around the world.
Question #3: How does it work?
This is where it’s easy to get in the weeds.
To me, the best way to think about it is like this: we all drive a car, but how many of us understand the finer details of how an engine works?
However, here’s a quick explanation…
Bitcoin and “the next Bitcoin” work thanks to something called a “blockchain,” which is nothing more than a very secure online database. However, this database has a key feature, and that’s the fact that it is decentralized.
“Decentralization” simply means all the records about the digital currency are tracked on thousands of computers around the world.
That means it’s almost impossible for these digital currencies to get “hacked,” because, to do so, you’d need to change the records on THOUSANDS of computers!
Compare that to a Central Bank.
The Fed, for example, was recently victim to the largest bank theft in history. Digital thugs from Bangladesh stole $100 Million.
The reason this happened was the Fed is not decentralized. It’s a single entity.
That’s why the blockchain is so powerful. Thousands of computers around the world form a digital “chain” that determines—by consensus—what the truth is. So you can’t invent money out of thin air… you can’t fake an entry (like Enron)… and you can’t delete money.
Question #4: Wait, so if this is all tracked does that mean it’s not anonymous?
Yes, it is anonymous.
Here’s how it works: For every transaction there are two “keys.” One is a public key, and another is a private key.
By using the public keys the entire system of decentralized computers (the blockchain) can track the history of transactions and keep it honest (to make sure no one is trying to manipulate any records). HOWEVER, only you have access to your private key. So you remain anonymous.
Let’s use an example. Say you want to buy a 2014 Ford F150 from a guy named John Smith. You decide to buy it with your supply of “next Bitcoin” coins…
Well, in this case, the blockchain will know a F-150 truck was purchased on X date for Y dollars… but... it won’t be possible for any “onlooker” to see that it was you and John Smith who made the deal.
Make sense?
Question #5: What makes “the next Bitcoin” better than Bitcoin?
It has to do with the underlying technology, the “blockchain.”
You see, Bitcoin was a pioneer with this technology… however, their blockchain is essentially only usable for currency.
On top of that, as I mentioned in my article up top, it’s relatively slow (taking 10 minutes per transaction vs. 15 seconds for “the next Bitcoin”).
The genius behind what Vitalik Buterin did is… essentially… he created a new blockchain—a “blockchain for everything.”
That’s why IBM, Microsoft, Samsung, and 11 banks are behind this. And why 31 more banks and the Toronto Stock Exchange are looking into it.
With “the next Bitcoin,” you have a new, more secure and efficient way of doing things in countless industries.
You can have a check “clear” instantly instead of in 5 days… You can buy a stock and have it transferred to you automatically instead of in 72 hours… and all sorts of things.
In fact, even the government of Connecticut has started to use the blockchain to keep track of some of its important data!
And the beauty of it all is…anytime Buterin’s “next Bitcoin” technology is used… the value of the currency likely goes up.
Question #6: Couldn’t anyone else create “the next Bitcoin”?
In theory, yes…
But keep in mind…
The #2 alternative currency in the world
Vitalik Buterin has been involved with Bitcoin since 2011 . He’s a former key programmer. He won a $100,000 fellowship from Billionaire Paypal co-founder Peter Thiel. He won a World Technology Award over Mark Zuckerberg. He raised $18,000,000 to start up “the next Bitcoin” and the total value of the currency is now worth almost $1 Billion. Out of 600+ digital currencies it’s already quickly shot up to the #2 spot as the world’s most valuable digital currency.
How easy is it to replicate that?
And, let’s not forget…
Over 38,000 people in the world have already signed on to learn more about (and help support) this right now. Microsoft gave the nod to 3 million developers. 11 banks (worth $808 BILLION) have tested this. The New York Times, Wall Street Journal and CNBC have already written about it. And Wall Street and Silicon Valley insiders are starting to invest right now…
So I’d say “the next Bitcoin” has quite the head start!
Question #7: Is this legal?
Yes, while this very question is still being debated in parts of the world, in North America, Australia, and most of Europe it is 100% legal.
Here’s a map that shows (in green) the 61 countries where it’s legal to buy “the next Bitcoin.”
Have more questions? I’ll be answering more in my next monthly issue of the Palm Beach Letter.
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