Ok, so Bitcoin has slipped from it’s all time highs…
Yes, it has retraced back down to around $11,000…
But only a fool would call this the ‘Death of Cryptos’.
According to the 99bitcoins.com site, Bitcoin’s ‘died’ 212 times!
When someone calls time on Bitcoin, this site keeps track of the story or what it calls “Bitcoin obituaries”.
And records the Bitcoin price at the time.
Of course, it’s a pro-Crypto site.
It’s bound to mock any scepticism towards Bitcoin.
But the fact is, every time a new headline points at Bitcoin and calls it “dead” or predicts its demise, Bitcoin marches on.
So far at least, any reports of Bitcoin’s death are greatly exaggerated.
Beware meaningless predictions
Truth is, no one really knows what the future holds for Bitcoin…
Either in terms of its acceptance and how it’s adopted as a method of payment or store of value…
Or in terms of its price.
Maybe the price of a Bitcoin will reach $60,000 next year. (It hit $19,800 earlier this week, after staring the year at $963.)
Perhaps it’ll reach $100,000… or $500,000… or any of the other wild targets ultra-enthusiasts are plucking out of the air.
At least one guy I’ve seen has predicted a million-dollar price tag.
What does he know that you and I don’t?
But it gets him in the press… and generates headlines. And keeps the excitement going.
But he can’t know whether it will reach that price. It’s impossible to predict.
And it’s the same with these downside targets that get thrown around.
None of us can know whether the price of Bitcoin will fall from the current $17,000 to $10,000…
Or even to zero as some Bitcoin bashers are predicting.
At least not on valuation grounds anyway.
OK, if you’re a seasoned technical analyst, then you can work out potential target areas based on previous price action.
In fact, certain charting techniques like Elliott wave theory and Fibonacci work well on Bitcoin and other heavily traded cryptos.
The end of Bitcoin, though? I can’t see how you can forecast that with any certainty.
But it doesn’t stop people trying!
You don’t have to look hard to find stories of people saying Bitcoin is doomed.
But without much in the way of a convincing argument.
Sometimes it’s high-profile investors who’ve been left behind as Bitcoin has taken off.
They’re a little bit sore about missing out on the gains others are making.
So they speak out about how Bitcoin’s a fraud… or how it’s doomed to fail.
But I don’t know whether you’ve noticed this yourself…
Why these guys HATE cryptos
A lot of times, it’s not just disgruntled guys throwing the stones…
It’s members of the financial elite! The ‘old guard’ banks and money men of the City and Wall Street who make money off other people’s money.
The fact is, a lot of the financial establishment hates Bitcoin.
Not just Bitcoin – but the whole crypto movement… and what it stands for.
They take every opportunity to belittle, discredit and put cryptos down…
Have you ever wondered why this might be?
To scare you away of course!
To make you question and doubt the validity of Bitcoin and other cryptocurrencies.
Think about it…
All the time money is pouring into cryptos… that money is moving away from them and their highly-charged funds.
So what do they do?
They badmouth Bitcoin.
They warn of bubbles bursting and ‘fraud’ and catastrophic losses.
But not because they are worried about you…
They’re worried about your money going elsewhere!
They’re scared of losing control of the financial system they’ve ruled for centuries. The same system that almost destroyed in the Global Financial Crisis (GFC) of 2007-2008.
And remember, it was that crisis that spawned Bitcoin in the first place!
Bitcoin exists because of the failures of the system
In the wake of the GFC, people were fed up of dealing through financial middlemen (banks).
So, Satoshi Nakamoto set about creating a decentralised, peer-to-peer electronic cash system. Bitcoin was born.
OK, so it’s not been widely adopted yet as a payments system.
But the capability is there. And the technology that powers it, the blockchain, will grow and prosper in the years ahead.
Not just with Bitcoin.
But with the other cryptos or ‘altcoins’ that are being created to decentralise payments and transactions across all areas of the economy.
That’s why the big shots of the old financial establishment fear cryptos.
They fear losing control of the system… Losing power… Losing profits.
And it’s not just Bitcoin, the blockchain and the new companies growing out of breakthrough in technology that the City mob fears…
It’s also the way these new ventures are being financed.
They’re not funded by a few corporate financiers or banks putting in a large chunk of money for a hefty fee.
Instead, lots of regular investors – people like you or me – put in a small amount of money.
The power of the Crowd
You’ve probably heard the term ‘crowd funding’.
The Crowd is a collective of investors that pool their money to fund a new business venture.
Sometimes they get rewards in return for their money.
For example, an author might raise money to publish a book through a crowd funding platform.
A bunch of people contribute £10 or £20 and hopefully enough is raised to publish the book.
If it is, they get a signed copy of the book in return.
But as well as rewards-based equity funding, there is also equity crowd funding.
Again, lots of small investors (The Crowd) put money in.
But this time, they get a small piece of equity in the business. So, it’s a bit like investing in shares.
And if the venture goes on to be a big success, you might make a big return on your investment. But if it fails, you can lose your money.
The point is you’re investing direct with the company, without going through a financial middleman like a bank. That keeps costs low.
Of course, the banks don’t like equity crowd funding at all!
It removes them from the picture. And it means they’re missing out on fees.
And they hate ICOs even more!
Crypto plus Crowd
ICOs are initial coin offerings. It’s like a combination of crowd funding and cryptos or altcoins.
Someone comes up with a smart business idea using blockchain technology. And they need investment to fund development, staff, business growth and so on.
But they don’t go cap in hand to some City fat cat who’ll charge megabucks to invest his money, like in the old days.
Instead, they go to the crowd.
Lots of people invest a little bit. And hopefully together it’s as much as or more than the company was looking for.
If so, the venture launches. If not, the money is returned to investors.
With ICOs, you don’t get equity in the business as you do with equity crowdfunding.
You invest by paying in one cryptocurrency (e.g. Bitcoin) and you get another crypto or ‘token’ in return.
Just like Bitcoin, there is a fixed amount of these ICO tokens available.
So, if the business goes on to be a roaring success, and everybody wants to buy into the crypto coin behind it (like they do with Bitcoin!), that coin will soar in value.
And it’s been a huge opportunity in 2017 and looks likely to be even bigger in 2018.
This from Forbes:
“Initial Coin Offerings (ICOs), exploded onto the scene in 2017, going from a relatively unknown fundraising method used in the blockchain community, to raising over $4 billion YTD.”
Of course, the financial establishment don’t like this at all!
But there’s nothing they can do, except continue to attack Bitcoin and try to put investors off in the hope cryptos and ICOs will just go away.
But they are doomed to fail.
The blockchain is technological progress at its best. Like when the automobile was first invented. Or the Internet.
And ICOs will grow in popularity as a way for businesses to raise cash… and investors to make great returns… but without the exorbitant fees of the banks and City financiers.
Bitcoin has been the crypto getting most of the attention in 2017.
Look out for many more ICOs in 2018
But this crypto story is far bigger than Bitcoin.
It’s about all the other cryptos that have been making huge returns for ordinary investors – without the City or Wall Street being involved…
And it’s about the ICOs of new blockchain businesses happening now and in 2018.
Businesses that are being funded by people who want to put a small amount of money in for the chance of substantial gains.
Some of the biggest names in the crypto space started out as ICOs.
For example, Ethereum launched as an ICO at 30 US cents per coin. And it’s gone up 254,370% in value in the three years since.
There are plenty more examples of mind-boggling ICO returns.
And according to Forbes, you can expect lots more ICO stories in 2018:
“The year 2018 is gearing up to be the year where institutional money begins to move into cryptocurrencies and ICOs at a much quicker pace. With blockchain and cryptos making the mainstream headlines weekly, and new crypto funds springing up left and right, expect to see ICOs continue to gain traction and dominate the landscape for blockchain-based companies trying to raise funds in 2018.”
You’ve got to be careful though.
ICOs are not regulated. And that makes it easy for anyone to put together a business proposal, give it a catchy crypto-based name and launch an ICO.
There have been some out-and-out fraudulent ICOs, where crooks have taken people’s money and disappeared. And there will be more.
And there will be ICOs from people with good ideas and intentions who just don’t know how to run or grow their business. People will lose money there too.
So make sure you do your homework if you’re thinking of taking a punt on an ICO. If you can, get some help from someone who knows what to look for.
Here at Monkey Darts I’ll be keeping track of the ICO market and cryptos in general. It’ll be the most important investment story of 2018.
And if you want the help of a real crypto pro, check out Finn’s Crypto Kickstart Programme.
He’s put together a great course to show you all you need to know to get started in cryptos. And he’ll let you know his top crypto pick for 2018.
That’s all from me. Have a great festive break – and I’ll be back with more in the first week of January.