That’s what the critics will have you think. “Tulip Mania.” “Beanie Babies 2.0.” “Bunch of scammers.” “It’s all gonna end in tears.”
Crypto has been around since 2008. The unpaid skeptics are nothing new. They trash every new technology because it’s easier than understanding it. This article isn’t for them.
Crypto always makes a comeback. Prices have already recovered. Bitcoin is up 79.89% this year already. Ethereum is up 54.6%.
The next price explosion is likely not far away. Let me explain so you’re not asleep at the wheel when the action happens.
The most obvious pattern even a blind monkey could spot
Every 4 years the Bitcoin halving event happens.
This is a rule that’s programmed into the code of Bitcoin and can’t be changed. The rule says the reward for mining Bitcoin halves every 4 years.
Those who mine Bitcoin simply use the power of their computers to secure the network. They will get paid less after the halving. All this feature does is help reduce the supply of Bitcoins and that creates scarcity.
Scarcity helps to create value in the network.
Based on prior halvings this event leads to an explosion of price for Bitcoin. Investors try to front-run the event to make a profit.
The rising price of Bitcoin historically helps bring up the prices of other high-quality cryptos that have adoption and real-world use cases.
It’s the closest to a sure thing I’ve ever seen. I never expect 300% gains but I do expect a modest 25%-50% rise in the Bitcoin price.
Research the Bitcoin halving. Understand it. Consider being a part of it.
The Blackrock situation most people are missing
Blackrock is one of the biggest Wall Street firms in the world.
Bloomberg predicts Blackrock’s assets will exceed $15 Trillion in 5 years’ time based on current growth. When Blackrock makes moves people pay attention.
Many people haven’t noticed what’s going on.
Blackrock wants to create an ETF product that will allow more retail and institutional investors to enter the Bitcoin market.
The CEO Larry Fink is showing up all over mainstream media and preaching the Bitcoin gospel.
He’s not doing this for fun or as an experiment. He knows Bitcoin has value and sees it as a way for his firm to make money. If Larry keeps running this Bitcoin marketing campaign, people will start to listen.
It wouldn’t surprise me if it triggered the next bull run.
Image credit — Lark Davis via a tweet
If Larry’s ETF product gets approved then I expect investors to go crazy. The crypto mania of 2021 will be nothing. At the same time one has to have patience. These huge milestones don’t happen overnight.
The ETF still has to be approved by the USA’s regulator the SEC. They’re not going to suddenly flinch and approve it. And they won’t be pressured.
So for now everyone is sleeping on Bitcoin and its price is chopping around doing nothing.
But don’t take your eye off the bigger picture.
One ETF means lots of other big-name ETFs will get created. That will allow everyone to buy cryptos on their phones using the legacy Wall Street firms the same way they do with stocks.
The global economic factors are aligning perfectly
The final important thing to know about crypto is it’s tied to the global economy. The dream from the Lambro Bros was that crypto would decouple and do its own thing in the corner of the playground.
It never happened.
All financial assets, including crypto, are tied to the global economy. When interest rates rise high and central banks stop creating money out of thin air to pay for bat viruses and banking collapses, the markets cool.
People and institutions take fewer risks.
The worst of the interest rises appear over. The current rates are unsustainable, so they can only stay the same or (more likely) go down from here. Inflation is going down fast too.
These are all the economic influences we need for extra money to enter the system and get invested in riskier assets like crypto. We have arrived.
No more waiting.
The two obvious signs crypto has already started to make a comeback are:
- Retail investors are buying 3X more Bitcoin than is mined every month
- Staked Ethereum (ETH that sits in a term deposit-style product) is at an all-time high.
And, of course, Bitcoin holders aren’t selling and coins are continuing NOT to move. Those that hold Bitcoin are too smart to be fooled by a bear market like they were in 2017 and early 2020.
Crypto adoption has also been given a boost thanks to Google Play’s app store lifting its ban on crypto games.
I find no one factor causes crypto prices to go up fast like they did in 2020–2021. But when multiple factors are all in play, the odds of another gigantic bull market increase and the eventual outcome seems obvious in hindsight.
The lessons here are simple:
- Pay attention to crypto
- Don’t ignore the Bitcoin halving
- Dare to be an investor in the movement with a tiny percentage of your net worth.
See you in the next crypto bull run. Stay safe out there and don’t get swindled by sh*t coins and new projects. Blue chips are the easiest bet.
This article is for informational purposes only, it should not be considered financial, tax or legal advice. Consult a financial professional before making any major financial decisions.
