Remember when bitcoin was going up? In the first four months of the year, the world’s first cryptocurrency soared. It went from $28,996 at the start of January to a peak of $64,869 on April 15 – a 124% rise. Then came the fall… Bitcoin (BTC) has since plunged as much as 55% from its high. And the crypto market fell along with it. As I type, bitcoin is down 53% from its peak. You may be asking, “Who are the crazies who invest in this stuff? Why would any sane person own something that can fall that much in so short a time?” The answer… anyone who wants to turn tiny grubstakes into life-changing gains. Already, paid-up subscribers of our crypto investing expert, Teeka Tiwari, have had the chance to make 8,465% on bitcoin. That would have turned every $1,000 grubstake into $85,650. And as you’ll see today, two key fundamental forces mean there’s still the potential for a nearly 1,500% gain from here. We don’t recommend you take your life savings and dump it all into crypto. That would be reckless. But as part of a diversified portfolio, speculations on crypto are still your best shot at really moving the needle on your wealth. | Recommended Link | | Tonight at 8 p.m. – “The Biggest Prediction of My 40-Year Career” He predicted the two biggest market crashes of the past 15 years… Called the gold crash of the early teens and the recent gold boom… Predicted the bottom of the market in 2020… the historic rally that followed… the mini-meltdown last September… and more. And tonight at 8 p.m. ET, he’ll hold a free event to explain where to put your money right now… And how you could have already doubled your money 14 different times this year with his trading plays… It’s a once-in-20-years trading opportunity… (By clicking the link, your email address will automatically be added to Jeff’s RSVP list.) | | | -- | First, a warm welcome to new readers… If you’re reading the Cut for the first time, you recently subscribed to one of the 20 paid investment advisories we publish at Legacy Research. It’s the publishing alliance of Teeka Tiwari’s Palm Beach Research Group, Jeff Brown’s Brownstone Research, Doug Casey’s Casey Research, and Bill Bonner’s Rogue Economics. The Daily Cut is the premium e-letter we created for all paid-up Legacy subscribers. If I (Chris Lowe) am doing my job right, you’ll never miss a big moneymaking idea from Teeka, Jeff, and the rest of the team. One of the core recommendations we’ve been making – since August 2018… just days after our inaugural edition – is to own some bitcoin. We weren’t on the case as early as Teeka. Still… if you’d bought bitcoin when we first recommended it here at the Cut… you’d be sitting on a profit of 400% today. We never said it would be a straight shot higher… Quite the contrary… We’ve shown you, over and over again, how bitcoin and other cryptos are highly volatile. Here’s how Teeka put it… We’ve seen how volatile bitcoin can be. In the 2018 “Crypto Winter” bear market, it plunged as much as 84%… only to rocket to new highs this year. I’ve said for years that volatility is the price you must be willing to pay for life-changing gains in crypto. You won’t see these huge up cycles without some huge down cycles, too. That’s why he recommends readers of his flagship Palm Beach Letter advisory set aside no more than 10% of their portfolios for bitcoin… and another 2% for smaller cryptos (aka altcoins). That way, even a 50% drop in bitcoin will take only a 5% chunk out of your overall portfolio. That’s unpleasant. But it’s not a steep enough fall to make you panic sell. So you can hold your position long enough to profit from the subsequent recovery. These recoveries have been a marvel to behold… I put together a table to show you what I mean. In the second column, you see the annual gain or loss for bitcoin. In the third, you see the maximum drawdown (peak-to-trough fall). Bitcoin | | Year | Annual Return | Max Drawdown | | 2010 | 9,900% | -94% | | 2011 | 1,473% | -94% | | 2012 | 186% | -85% | | 2013 | 5,507% | -83% | | 2014 | -58% | -71% | | 2015 | 35% | -78% | | 2016 | 125% | -30% | | 2017 | 1,331% | -40% | | 2018 | -73% | -72% | | 2019 | 95% | -43% | | 2020 | 301% | -61% | | 2021 YTD | 10% | -55% | Looking at this table, one thing is clear… If you can’t handle sky-high volatility, you can’t have the chance to earn the outsized returns bitcoin has delivered. As a U.S. Air Force flying manual from the Korean War said, “No guts, no glory.” The same is true of stocks… Since going public in 1997, Amazon.com (AMZN) shares have climbed 146,985%. That’s enough to turn every $1,000 stake into about $1.5 million. But to earn those gains, you’d have had to suffer through drawdowns of 56%… 65%… and even 94%. Apple (AAPL) is up 147,944% since it went public in 1980. That’s also enough to turn every $1,000 into nearly $1.5 million. Why Crypto Is About to Have a "Netscape Moment"… But to realize those gains, you’d have had to go through a 91% plunge in the dot-com crash. And there were several drawdowns of 40% or more to challenge your faith along the way. That’s why Teeka calls volatility “the price you must be willing to pay” to earn spectacular results as an investor. I refer to this a lot. But it’s critical to grasp… If you’re not willing to pay this price, you’re better off avoiding crypto altogether. Put your money instead into something like a bond fund or a bank CD. You’ll be out of the running for life-changing gains. But you’ll avoid the stomach-churning volatility that comes with crypto investing. If you’re willing to stick it out, the case for bitcoin is stronger than ever… Back to Teeka… The best way to think of “Mr. Market” is as a moody teenager. Sometimes, he’s on a high… and is bidding up assets beyond their fundamental values. Sometimes, he’s in a sulk… and is prepared to sell the same assets for less than they’re worth. I’m not saying I don’t ever look at crypto prices. That’s impossible. But I don’t let price be my guiding star when it comes to my research. When I’m figuring out the future of any investment, I look at two things: Is it getting better? Are more people using it? This is particularly important for investments in new technologies. And I view cryptos as a tech play. So for a moment, I want you to forget bitcoin is down 53% from its high. And I want you to consider some of the latest news around innovation and adoption. Rootstock (RSK) is one of the most exciting new innovations… The bitcoin blockchain keeps a tamperproof record of all bitcoin transactions. RSK is what’s known as a “sidechain” – a blockchain linked to the bitcoin blockchain. It allows developers to build decentralized finance – or DeFi – services based on bitcoin. This will open the door for decentralized crypto lending and trading… decentralized exchanges… even decentralized e-commerce platforms – all on the most secure blockchain in the world. RSK also speeds up transactions. It can handle about 100 transactions per second (tps) – roughly the same as PayPal. And it plans to bring that to 20,000 tps. Right now, the bitcoin transaction speed is 5 to 7 tps. RSK will bring a clear improvement in usability. It will allow for transactions up to 4,000 times faster than what the bitcoin blockchain is able to handle on its own. Some interesting new folks are adopting bitcoin, too… I’ve spilled a lot of ink in these pages about corporate America’s adoption of bitcoin. We’ve looked at how large corporations such as Tesla (TSLA), MicroStrategy (MSTR), Square (SQ), and PayPal (PYPL) are adding the cryptocurrency to their balance sheets. That’s because they see it as a good hedge against a devaluing dollar… and negative interest rates around the world. We’ve also looked at how Square and PayPal now allow their customers to buy crypto via their online payment apps. And as Teeka’s analyst Grant Wasylik pointed out recently, U.S. politicians are the latest adopters… You can read Grant’s essential essay in Teeka’s free e-letter, Palm Beach Daily. But I’ll give you the highlights here… Financial disclosures from July 7 reveal that Senator Pat Toomey (R-Pennsylvania) invested in two of Grayscale’s crypto funds. These allow you to get exposure to bitcoin and other crypto through your regular broker. Toomey isn’t the only lawmaker on Capitol Hill who owns crypto. Filings reveal that Representative Barry Moore (R-Alabama) and Senator Cynthia Lummis (R-Wyoming) do too. Some politicians are taking it a step further. Miami’s Republican mayor, Francis Suarez, wants to turn the city into a crypto hub. He’s pushing for the city to pay municipal employees a percentage of their salaries in bitcoin. He’s advocated for accepting crypto for taxes. He’s even financing his re-election campaign with bitcoin. And state legislatures in Texas and Wyoming have passed laws recognizing the legal status of cryptocurrencies. | Recommended Link | Bill Gates and Fellow Billionaires "All In" on This Small-Cap It's no wonder Citron Research says this small-cap is "backed by the world's most sophisticated investors." Bill Gates invested over $300 million into this small-cap stock. His fellow billionaires like David E. Shaw and Ron Baron bought over 9 million shares combined. Elite funds like BlackRock and Vanguard are in too. Fortunately, tech expert Jeff Brown says there is still time to get in — before this stock explodes. | | | -- | In short, now is a great time to buy crypto… Remember, you make money in the market by buying low and selling high. That means buying when others are fearful… and selling when others are greedy. And right now, as we’ve seen, fear is stalking the crypto market. But it’s just a short-term issue. Teeka sees bitcoin heading from $32,500, where it is today, to $500,000, as innovation and adoption make it more valuable. This won’t be an easy move. It’s hard to buy in times of fear. But if you have the guts, it’s a great way to lock in lower prices for the world’s premier cryptocurrency. You stand the chance to make a 1,438% gain as bitcoin rises to Teeka’s target price of $500,000. That’s enough to turn every $1,000 investment into $15,385. You can find out how to buy bitcoin in our free special report here. Just remember to keep your position size small. Teeka recommends an initial stake of $200 to $400 for smaller investors and $500 to $1,000 for larger investors. In the mailbag: “Scoff at cryptos at your own peril”… If it wasn’t obvious from today’s essay, we’re big fans of bitcoin here at the Cut. But not all your fellow readers are on board… I cannot see that anything that fluctuates as sharply as bitcoin can be useful as money. Clearly, many people have made plenty of money from it. There are some persuasive arguments, and I was tempted. But I did not invest, for the same reason that I would not invest in most modern art, trade trainers, or buy a film star’s brassiere – I think they are rubbish. Even if I could make huge profits and sell to the greater fool, I would not do so. – Richard B. What I find mind-boggling with cryptocurrency is that no one is in charge to secure and run it. Where is the brain or CPU? Who controls or manages it? It seems to be its own living thing. Will it become a system with artificial intelligence? It seems that only mutual self-interest controls and directs it. How long can that last? – Richard B. As far as I’m concerned, “There is nothing new under the sun.” Gold and a gun to your head are the only two currencies that have ever existed – and will ever exist. If bitcoin is an asset, what is its utility, its uniqueness, its value… aside from being a complete waste of energy? – Nick C. Other readers have defended the crypto… Talking heads say bitcoin is doomed because it is environmentally unfriendly. It uses too much electricity and pollutes the planet. Yet some say electric vehicles are the future and will save the planet! Uh, won’t electric cars use a lot of electricity as well? Pray tell, how is one saving the planet and the other destroying it? I think bitcoin has the Fed running scared. Governments are doing everything to slow down the inevitable. – Brian M. When the first personal computer came out in the 1980s, I dismissed it as a glorified typewriter, nothing more. Now, PCs control virtually every aspect of our lives. Most people can’t do without them. When online shopping first appeared, I laughed – only a fool would buy something without being able to touch, hold, and inspect it. Now, Amazon rules the world. When streaming came on the scene, I scoffed. Why would anyone want to watch a movie at home, on their TV, when they could go to a movie theater to see it on the big screen? So dismiss, laugh, and scoff at cryptos at your own peril. They have the potential to change the world as dramatically as did the PC, online shopping, and streaming combined. – Dale A. Are you expecting cryptos to change the world, as Dale does? Or do you agree with Nick that bitcoin is a “complete waste of energy”? Join the debate by writing to feedback@legacyresearch.com. Regards, Chris Lowe
July 22, 2021
Barcelona, Spain Like what you’re reading? Send your thoughts to feedback@legacyresearch.com. IN CASE YOU MISSED IT… New Financial Warning [Viewer Discretion Advised] This video is going viral… A former NY grocery bagger – who rose to the top of Wall Street in just 3 years – blasts Congress and reveals sickening truths about America… Now, in his latest video, he shares a bold message for all Americans… WARNING: What you are about to watch is controversial and may be offensive to some audiences. Viewer discretion is advised. Show me the video now. 
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