Sometimes, it’s best to just sit and do nothing. The grand old man from Nebraska also thinks so, he’s good at sitting around and letting things compound! But I’m not Warren Buffett, no, I’m ordinary Joe! And I can’t sit around waiting for things to happen, I have to earn a living!
This time, however, I’m glad I sat around doing nothing on this. Which explains the lack of updates! More on this later, read on.
In September, I released a detailed article on blockchain and cryptocurrency. And for ZENCAPITA readers I had identified three cryptocurrencies to keep an eye on – 1) Bitcoin, 2) Ethereum and 3) Ripple. Ripple is slightly different because it focuses on interbank transactions, so let’s just focus on two of these for now – Bitcoin and Ethereum.
When I published the post on 15 September 2016, Bitcoin (BTC) was at $608.80 and Ethereum (ETH) was at $11.98.
And what are the prices as of today, 14 March 2017 – 6 months in?
That’s 103% for Bitcoin and 140% for Ethereum. Not bad for 6 months, on an annualized basis – that’s 206% and 280% respectively. Ok, so maybe I was lucky, I had no way of knowing ahead this is how much it would rise. Am I happy, yep… good start for 2017! Am I sticking to this or re-allocating. No. Why?
Well, Bitcoin was the most interesting, at the beginning of March, the price of Bitcoin crossed the price of gold for the first time ever and shot up further on the news of a potential ETF being approved by the SEC. The ETF by the Winklevoss brothers (if you don’t know, these guys were the ones trying to sue Mark Zuckerberg for stealing the idea of Facebook) however was rejected on 11 March, and the price of Bitcoin dropped by $300 before recovering again above $1,200. But it wasn’t the only one – there are two other ETFs waiting for approval.
Furthermore, the supply of new bitcoin is halved every four years. And whenever the supply is reduced, the price goes up. And just like gold, the supply is finite at just 21 million possible coins.
On 9 March, Ethereum was on a roll, along with other currencies. But Ethereum is now the second largest cryptocurrency with a market cap touching $2 billion (as against Bitcoin’s market cap of $24 billion).
Is this all euphoria, maybe, maybe not. The world is going through some serious changes, politically and economically. And it’s just starting to get worse. I don’t want this to be a gloom and doom letter, so I’m only going to share what I’ve done so far.
Whenever a new government wins an election, there’s usually a honeymoon period for them to adjust, and generally nothing of value takes place during that time. It can last from 3 to 6 months. Following the US elections which took place in November, we’re currently in that period when the honeymoon is getting over, so imagine all the action that will take place.
I’m really interested in doing a daily letter, but I’ll only do it if there is an interest. It will not be free, it will be paid. You’ll get my latest and greatest as I invest – complete transparency. Are you in? Contact Me.