Bitcoin has caught the mainstream off-guard.
The idea behind the cryptocurrency was simple. A monetary system without a ‘trusted’ third party overseeing it. A digital currency that can’t be controlled, manipulated or printed; one whose value is determined by the market alone — the opposite of the fiat currency system we have today.
Appetite for Crypto is Growing
Yet, as of Friday last week, bitcoin is now up 227% year-to-date. And it’s only August.
The growing consumer appetite for all things crypto can no longer be ignored. The mainstream has no choice but to jump on the bandwagon.
However, the rise of cryptocurrencies causes headaches for central banks. To date, Japan is still the only country that has accepted bitcoin as legal tender. There are whispers that Russia will make moves to embrace cryptocurrencies as money in the future too.
But what about Down Under?
Australian banks and the government continue to distance themselves from any digital currency. They label them as ‘untrustworthy’ and ‘volatile’.
Yet perhaps cryptocurrencies aren’t unstable or untrustworthy. Perhaps, instead, they are just working out their place in a world where fiat money reigns supreme.
Bitcoin price index
[Click to enlarge]
Bitcoin’s price-rise in a few short years is nothing short of incredible. And it’s exactly why governments and central banks warn you that cryptocurrencies are for ‘crooks, charlatans and people who lurk in shadows’.
But money that operates between two parties — without an intermediary overseeing transactions — liberates us from the oppression of fiat money.
Cryptocurrencies have the power to free us from the tyranny of central bankers.
But whether bitcoin replaces the existing monetary system isn’t the point. What matters is that it has challenged that system.
This needed to happen.
Consider this: Tesla Motor Inc. [NASDAQ:TSLA] first launched its Roadster model in 2006. Was there a market for a pure electric vehicle? No one knew for sure. There was merely an idea that people wanted something else.
Less than a decade later, every major car manufacturer has an electric model vehicle for sale.
Tesla challenged — and changed — the market.
Bitcoin was the first-mover in cryptocurrencies. Yet cryptocurrencies will become more powerful as more people learn about and use them. And their success will put pressure on central banks to leave the monetary system to its own devices.
Sam Volkering, editor of Sam Volkering’s Secret Crypto Network, tells me there are over 800 cryptocurrencies available today. However, he says that, while bitcoin was the first mover in the crypto space, there are greater investing opportunities ahead outside of bitcoin.
Rather than being a fringe idea that gets your money out of the banking system, cryptocurrencies are slowly becoming legitimate investing options.
As Sam explained to his subscribers recently:
‘We remember people thinking bitcoin at US$200 was expensive. Heck, we were one of those people at the time. But that was our “traditional” finance brain speaking. Our gut told us this was transformational. It was a revolution — and that’s exactly what bitcoin is.
‘It’s easy to sit back and think you’ve missed the boat. The incredible price rises these cryptocurrencies have already enjoyed are hard to ignore. But the potential future gains are far greater than what we’ve already seen.
‘It’s gaining ground among governments. It’s got big business on board. It’s already showing what it can achieve. And its development community is pushing ahead with updates and improvements to the network.’
Sam has his eye on more than bitcoin alone. As he told me, with cryptocurrencies still in the early-stage growth phase, it’s not too late to get on-board one of the fastest-rising asset classes of the 21st century.
Bitcoin — and other cryptocurrencies for that matter — are unlike anything we have ever seen. The scepticism that central banks have towards cryptocurrencies should be your incentive to learn about and consider investing in this new way of thinking about money.
The fact that it has so many powerful authorities scared of it is the reason you should look into how cryptocurrencies might work to help potentially protect and grow your portfolio.
Editor, Markets & Money