Crypto

Came for the gains, stayed for the brains

Image by Hal Gatewood


There has been a lot of talk recently about bitcoin and energy usage.

The ESG narrative and how crypto mining is so bad for the environment. We even have the energy policy makers in the EU looking to ban POW crypto mining (let’s leave their last success stories out of this conversation for now … LOL).

What are the odds they are accumulating BTC themselves?

As a reminder let’s see how much energy BTC mining is used globally. Here is a link to an article that covers the results from The Bitcoin Mining Council (BMC) Q3 2021 study.

It’s easy to get caught up in the 2 liners, on Facebook, Instagram and Twitter, on why mining is supposedly so bad for the environment, but here is a lengthy conversations about the intricacies of energy and the role bitcoin is currently playing in actually solving some of our global energy problems.

Bitcoin Energy Markets with Shaun Connell

In summary, according to the Bitcoin Mining Council (BMC), Bitcoin mining used 0.38% of the worldwide 50,000TW/h energy that is wasted due to inefficiencies. The Bitcoin and crypto mining industry is actually trying to solve problems and are in fact part of the solution. Many of us started in this space to fix a financial problem (gains being a small component of this), we have staying for far greater causes (the brains are here).

DISCLAIMER

This publication is general in nature and is not intended to constitute any professional advice or an offer or solicitation to buy or sell any financial or investment products. You should seek separate professional advice before taking any action in relation to the matters dealt with in this publication. Please also note our disclosure here

The Bitcoin Gambit

**Update: If the YouTube videos don’t load please search on Rumble.


Firstly, apologies for the delay in getting of out our newsletter and blogs this quarter. We were waiting for the 2022 Bitcoin Conference before publishing. We wanted to highlight the best and most significant keynotes given during the conference.

Our number 1, really explains the power of the bitcoin network and why it is significant, number 2 is all about the asset, how to protect yourself from the fiat fraud and finally number 3 - the ESG narrative and shaping the future.

Number 1 - Jack Maller’s Announcement and the King’s Gambit

Many people that get into crypto and bitcoin will always talk about price. What they are actually talking about is the asset (the incredible store of value proposition) . Bitcoin is more than that, it is a new financial network that enables customers and merchant without middlemen.

Jack’s “Kings Gambit” keynote is the best I have ever seen on this topic!

Rumble video if below doesn’t work here

Bitcoin 2022 Conference - Jack Mallers


Number 2 - Cult of the Central Bank: A Fiat Religion

If you don’t know what financial repression is then this is a great talk to understand how governments confiscate the wealth of their citizens in the form of inflation. He highlights how in 8 years he went from a $2000 salary to $20.

Our journey in the west is only starting, it’s time you understand hyperinflation and fast. It’s also worth noting his thoughts on CBDCs (central bank digital currencies) - they are the same flavour as fiat, so they will have the same properties… they will be debased and used against you.

Let’s just hope that some lesson can be taught and that people don’t have to learn the lessons of hyperinflation the hard way - only time will tell.

Rumble video if below doesn’t work here

Bitcoin 2022 Conference - Ricardo B. Salinas


Number 3 - bitcoin: Revolutionary Youth Movement

This is is one of the comments from YouTube that perfectly sums up the video “This might go down as one of the speeches that is recognized as vital to this revolution ! That man's voice was cracking because he was afraid he was being compelled to tell the truth ! Going public is handing your company to government indirectly !”

“ESG is the real enemy, it’s a hate factory and when you think ESG, think CCP”

For me, the key take away from this keynote, is that we have have momentum, we have an asset that can protect our wealth and labour, it’s transparent, fair and inclusive. We need to be careful, regulation it’s almost always used as a tool to corrupt a movement and finally, we need to be sceptical of the ESG narrative.

Rumble video if below doesn’t work here

Bitcoin 2022 Conference - Peter Thiel

One point I would make at around the 6:48 mark is that Peter’s slide should be changed. You can remove the ETH logo and replace it with the Bitcoin logo now that we have Lightning.

Updated Slide

Lightning Network has enabled this!

The final piece I will leave you with is a quote form Cathie Wood during the conference. As she says, every single word is important:

“Bitcoin is the first global private (i.e. non government) digital rules based monetary system in the history of the world”

DISCLAIMER

This publication is general in nature and is not intended to constitute any professional advice or an offer or solicitation to buy or sell any financial or investment products. You should seek separate professional advice before taking any action in relation to the matters dealt with in this publication. Please also note our disclosure here

Why are populations in dictatorships building crypto positions?

image by Ali Tawfiq

Would you be surprised if I told you that in the last 30 days we have seen significant growth in the visitor analytics to our site from the following 2 countries:

  1. Australia

  2. Canada

Now, I wonder why?

Could it be anything to do with: Locking away and preventing the movement of citizens, pushing policies to deliberately divide society, forcing people to take medication to work (or play sport), tracking their movements, threatening to kill their animals, using extraordinary measures against protestors and then freezing assets and bank accounts.

So big shout out to the fringe leaders in these great nations - who clearly missed their history lessons at school. Our "Black Face" Mr T was obviously even naughtier, he must have missed economics 101 (consequences and outcomes of communism) after he so eloquently spoke of his admiration of China’s Communist Party. I’d include you in on this one JA of New Zealand and all the companies like gofundme (your business model is dead).

Please keep up the great work, you are doing your citizens a wonderful service. You are opening up eyes like never before. They are spending the time:

  • to read and understand the bill of human rights (google them yourself and have a read),

  • to see how the current economy doesn’t actually work for them, how they work for currency that is a confidence game and inflation is actually a big deal.

  • to question what freedom of speech really means (thanks Joe R for highlighting this one, and thanks too to MSM for showing us exactly who you play for)

  • migrate away from social media platforms that don’t respect privacy and drive cancel culture

  • to understand the importance of the right to protest (whether you agree with the protest or not, is not important - defending the right to protest is whats important)

  • To understand Bitcoin and Crypto

“These nations do not have sleeping sheep, one by one the lions are being awoken”

Now for those of you are looking to build a position in crypto and don’t know where to start, here is a thread I wrote last week which will help. The story talks about “a guy”, but rest assured it does not matter if you are young or old, male or female, they, them, you are all included:

1/

There are 3 key ways to build a crypto position:

1. Take crypto as payment

2. Use defi yield tools

3. Follow the money

There are stories everywhere about #1 & #2 Nobody likes to hear about #3 To bad, today in this thread 👇, you will see how our guy made a start with #3

2/

Our guy was in his late 50s and had been looking for a way to get into crypto. He had a 5% portion of his speculative cash available to earn a little extra yield - ie the money he was prepared to allocate to highly speculative assets.

3/

The though of opening an exchange account, depositing money, deciding which crypto to buy and then moving all his crypto onto a hardware wallet or diversify risk by using multiple exchanges, was a step too far for him. But he didn't give up ...

4/

Being able to tell his grandchildren, even his son, that he owned some crypto sounded just awesome. What was more, he found a way to leverage the skills of seasoned crypto veterans, by copying their strategy. He could even add to his account monthly (or whenever he wanted).

5/

The product he went with in the end, didn't require him to have to pick an exchange - he didn't even know what that was, until someone explained, it was just a term for "where you buy crypto". - The exchange was registered with the Financial Conduct Authority (FCA) in UK ✅

6/

So he followed the simple instructions from the PDF he received to open an account and then followed the process to verify his account. Initially he did not worry about depositing money: - He used a simple gift code to fund his account ✅

7/

Our guy had previously been very concerned that he knew nothing about crypto. There were so many of them, which one would he choose. Was there a way to copy the allocations of some industry veterans (like an index)? - There was, he could copy "Rational Active Allocation" ✅

8/

It was at this point, that our guy began smiling (I can see you smiling). There was one last question about diversifying risk that needed addressing. - The platform uses multiple exchanges (requiring multiple signatures from different people/orgs) to protect assets ✅

9/

So with all his concerns dealt with - he decided to purchase the Crypto Starter Kit (*) he had seen advertised. He did this straight from his phone (he could even use apple pay and his finger to checkout). After paying he received an email confirming his purchase with a PDF.

10/

The PDF included in the Crypto Starter Kit (*) had everything he needed to get started on his journey to owning his first crypto. The gift card (2 amounts available) was then generated and emailed to him to load onto his account to copy the "Rational Active Allocation" strategy.

11/

If you want to start a position just like our guy in the story, check out RAAINDEX here.

(*) We no longer offer this product, find out more here

Lastly, I dedicate this blog to all the dictators out there, the cover image of this blog has a bicycle - I suggest you get on it!

DISCLAIMER

This publication is general in nature and is not intended to constitute any professional advice or an offer or solicitation to buy or sell any financial or investment products. You should seek separate professional advice before taking any action in relation to the matters dealt with in this publication. Please also note our disclosure here

Happy 2nd Birthday - Rational Active Allocation

Screen Shot 2021-08-17 at 09.52.10 copy.png

Just wanted to say a big thank you to our followers on our 2nd birthday!

Here are some 2 year KPI's:

  • Out performed BTC (530% since inception)

  • Greater than 10x Asset Under Management (AUM) growth

  • Above average copier investment ($8.96k)

  • ICONOMI "Verified" Public strategy

Screen Shot 2021-08-17 at 09.51.57 copy.png

Chart above is from the platform where our strategy for the public is run, very proud of our 2 year track record outperforming bitcoin. Since inception we have returned 530%.

Big thanks to the team at ICONOMI for their wonderful platform and continued support. Lastly, to our fellow strategy managers, thanks for keeping us honest and we are happy to be your partners in this industry.

If you haven’t yet joined our public "platform verified” crypto strategy Rational Active Allocation, you can do so with as little as £10 per month, follow the button below to get started. (*)

* You will need to register on the ICONOMI platform before you are able to copy our strategy.

This blog is dedicated to my co-founder “lovebtcuk” , here’s to many more sir!

DISCLAIMER:

This publication is general in nature and is not intended to constitute any professional advice or an offer or solicitation to buy or sell any financial or investment products. You should seek separate professional advice before taking any action in relation to the matters dealt with in this publication. Please also note our disclosure here

So how much should you allocate to our Crypto Strategy?

Image by Daniel Öberg

This is the question we are asked all the time and it’s actually very simple if you start from the following position.

An approach we have used is to take our net worth and divide it by 20, ie calculate at 5% what the maximum amount is that we can invest in a new idea. For example, suppose the sum total of all our assets: property, stocks, bonds, precious metals /cash, art and contents (ie anything that has a re-sale value) is 100k, then the amount we would be happy to allocate to crypto is 5k.

If we already had some crypto like BTC or ETH, then we would subtract that amount from the 5k and allocate the difference. So following on from the example above, assuming we already had some crypto to the value of 1k, and our net worth was 100k, we would allocate 4k to a crypto strategy.

The next question which comes up is: I don’t have that 5k or 4k in liquid assets, how do I get there?

To answer this, again we would do and have done the following, take the amount calculated above (either 4k or 5k) and divide this by 12 to calculate a monthly “dollar cost averaging” amount. For this example, that would compute to a monthly amount of 333.33 or 416.67 respectively.

The advantages of dollar cost averaging are clear, over time the peaks and troughs are averaged out and purchase price tends towards the mean. An additional advantage is that small monthly amounts can add up to significant amounts over time.

The next obvious question is why 5%, how did you come up with this number? We are in the business of managing risk, being well diversified and building strategies that have inversely correlated assets is key to successful investing. Think of a 5% allocation like having 20 different types of horses. The race is ever changing and the requirements to win will differ, your horses will need to be able to sprint, pace themselves over long spells in different climates and when some are not doing so well the others will have to step up.

Going into this race with 1 horse just isn’t sensible and realistically looking after more than 20 horses becomes extremely onerous.

Taking the above into account, for a well balanced allocation of projects in the crypto space, be sure to check out our offering - Rational Active Allocation

All circumstances are different, so individuals should always seek independent financial advice.

Institutions buy down markets…

image provided by Sean Pollock

This study looks at the total destruction of capital from the peak of the altcoin bubble, which so spectacularly came to an end in Jan 2018.

The chart shows the total capitalisation of all crypto currency excluding bitcoin. After losing approx 90% of their value, it wasn’t all that difficult to predict fortunes would turn and once again we saw the money flow into alt coins for a muted rally into end Jun 2019. Most of these gains have been lost, nearly 80% down this time.

The key point which is highlighted in the second image (3 day chart) is that we are back in a buying zone. It won’t be “mom and pop” buying, they tend to buy at the top, it will be institutional investors who will be filling their bags in “overlapping green zones”.

Institutions buy markets when they are down and sell markets when they are up

This is where we can help, register your interest here to be on the right side of this movement.

How important is demographics today?

image by Tyler Nix

It’s interesting for me to listen to people from all ages who talk about finance and investing and never (yes never, not once) talk about demographics.

I won’t bore you with the details, however if you’d like to understand how important it is, my suggestion is to read Neil Howe’s masterpiece “Fourth Turning” and secondly by taking the time to watch Real Vision’s YouTube video on the coming pension crisis.

We at Momentum Analytics understand the future challenges and more importantly have identified opportunities. Register your details here to find out how.