This year during the 12th of March, Bitcoin collapsed 50%.
That type of volatility usually scares away dumb money and causes them to write off the assets. The smart money is unaffected by this level of volatility though.
This is because smart money knows that innovation almost always leads to VOLATILITY.
Take startups for example…
They are illiquid investments, so there is no price discovery mechanism on a daily basis. If they were listed on exchanges they would experience the highest highs and lowest lows all in the same week.
Yet, we know that startup investing drives some of the best investment returns though.
You need volatility to get price appreciation. Volatility is not a bad thing by itself. People only hate volatility when it goes against them.
So why does this matter right now?
I looked this morning at the year-to-date returns of various assets…
- S&P 500: -12%
- Oil: -68%
- Gold: +12%
- Bitcoin: +23%
Bitcoin is up about 150% and fully recovered since March 12.
As one of the best fintech innovations of the century, it thrives on volatility.
Bitcoin also proved yet again to be the great store of value during the crisis.
Don’t get me wrong…
Gold will also serve as a great store of value. This has been a historical FACT.
BITCOIN HALVING is only 7 days away!
This will see a programmatic decrease in the incoming daily supply of Bitcoin from 1,800 per day to only 900 Bitcoin per day. That supply shock has historically led to a substantial price increase over the following 18-24 months.
This time should be no different.
If you’re a student of the Austrian School of Economics like me, you know this is inevitable.
In fact, the current situation is the ultimate set-up for Bitcoin:
- Trillions are printed by the major central banks
- Millions are losing their jobs
- Banks starting to shut down (See here)
- 120 million people are on the brink of starvation according to the U.N.
I had to pinch myself when I woke up this morning.
I remember writing last year about the potential for melt down of the fiat currencies and the global financial system.
Here we are now. It has played out almost exactly like I wrote in my article.
Currently, the Fed’s and ECB’s QE programs are the only thing keeping the global economy alive.
Peter Schiff said on several occasions..
“Printing money is to the economy what taking drugs is to a drug addict. In the short term, it makes the economy feel good, but in the long run, it is much worse off.”
And while the central banks are going to print more and more, the hangover in the form of inflation and financial collapse will arrive soon.
Now let us go back to our volatility conversation.
As we know, high volatility leads to high returns and vise versa.
And if you can ignore the short term price movements, your inflation hedge assets like Bitcoin and gold will make a lot of money during hyperinflation.
I believe that the Bitcoin halving being executed at the same time will serve as rocket fuel for its price.
Of course, you can buy both gold and Bitcoin at Virtuse by clicking HERE.
And that’s not all…
You can earn up to 10% interest on your gold, Bitcoin and stablecoins. Click HERE.
We always advise our clients to set aside 5-10% of their liquid assets in crypto. For example at the following portfolio:
- PAXG – up 10% this year (physical gold-backed cryptocurrency)
- Bitcoin – up 21% this year
- Monero – up 31% this year
I remain strong in my perspective that Bitcoin and gold will be the best performers coming out of this financial crisis.
They were both built to sustain turmoils and they should thrive in this one.
If I could give only one piece of advice, it would be DON’T RELY ON POLITICIANS to save you.
YOU are the only person that will save YOU during this crisis.