Whenever we vote, I imagine we are all doing it in hope for a better tomorrow. Our forefathers and ancestors made great sacrifices for our freedoms and the ability to choose for ourselves; and we elect officials who act as vehicles for the change we are hoping for. It’s all about hope!
This may seem outlandish or naive, but my reason for being so passionate about Bitcoin is because of the HOPE it brings me for a better tomorrow. A great example of hope is The Pilgrims who fled Europe in search of a place where they were free to worship as they pleased. They were looking for freedom of religion and not feeling like their faith was being coerced or manipulated. Likewise, I think people that believe and are passionate about Bitcoin are looking for a money system that is not being coerced and manipulated to benefit those in charge. We live in a world where governments are printing money. I’m not just talking about the United States. The U.S. probably has it the best. But in poor economic countries, their governments are printing more money, they are going into more debt, and their currencies are losing more purchasing power. COVID has only made the situation worse. As economies have slowed, governments have stepped in to dampen the effects. This has resulted in even more debt. At this point, they only way for them to get out of debt is to inflate the currency away. It’s bleak, but unfortunately true. And many are starting to see Bitcoin as their mechanism of hope.
Just look at the image below that shows Bitcoin priced in the local currency of each country, and how it compares to the all-time high price of that currency. It should come as no surprise that countries like Argentina, Brazil, Russia, and South Africa are seeing bitcoin approach all-time highs faster than other countries. This is where inflation of the local currency is a reality. In the United States, where the U.S. Dollar reigns supreme, it can be hard to appreciate the struggles happening around the world.
The fact is, we live in an inflationary world. This makes us motivated to spend rather than save as our currencies lose value over time. With Bitcoin, it’s just the opposite. Since there is a fixed amount that will ever exist, people are motivated to SAVE. That’s the whole reason the crypto community has the running joke to HODL (meaning to HOLD). It’s engrained into their psyche. Imagine a world where there is direct incentives to save your money versus spend it. Can you even imagine? For a great podcast on this topic, I recommend listening to Jeff Booth and his take on why we need to embrace deflation.
It’s fascinating to see bitcoin being recognized as a store of value play out in real time. Bitcoin is getting bought up at such a rapid base that the amount of Bitcoin on exchanges is getting drained. See image below.
The last time we saw the amount of Bitcoin on exchanges decrease was from July 2016 until March 2017, right before we had the mass wave of crypto growth that peaked out in December 2017. And during that period the amount of Bitcoin on exchanges dropped 11%. This time around, we are currently 22% off the high. This is inline with reports that Greyscale and CashApp are buying enormous amounts bitcoin as well as public companies like MicroStrategy and Square buying millions of dollars of bitcoin as part of their Treasury. The need for Bitcoin has escalated and the world is starting to recognize it.
As a millennial looking out at the world with a lot of life ahead of me, it can be easy to get overwhelmed, depressed, and lose hope in the future. But I have a lot of hope for the future because of Bitcoin!
CBDC Update
In my first newsletter two weeks ago, I talked about the emergence of CBDCs. Well, this week there have been announcements made about serious traction towards a digital Euro. The trend of Central Bank Digital Currencies is heating up. This is not going away!
Weekly Pricing Analysis
Bitcoin has continued to oscillate between $13,820 and $12,800. On Wednesday, it finally broke above $14,100, which should be enough to start pushing Bitcoin towards $16,000 and potentially beyond.
Ethereum has continued to prove weak against Bitcoin ever since I mentioned it in the first newsletter. It is getting close to becoming a good buy. I will be looking for Ethereum/Bitcoin to bottom around .02600.
Don’t forget, my 4-week Bitcoin / Crypto course starts next Tuesday at 9pm EDT. The course solves FOMO (Fear of Missing Out) and FOGS (Fear of Getting Scammed) and helps you have peace of mind while investing in this crazy space. There’s only a few spots left, so let me know if you want to join. The first cohort will also get 12 months access to my Slack group for direct mentoring.
Until next time…
Best,
Spencer