Compliance and Regulatory Updates

As an asset, Bitcoin has no correlation with traditional investments such as stocks, bonds, and real estate. This allows for you as an investor to capture opportunities that would otherwise not be available within the normal scope of your portfolio. Kevin Lu, hedge fund manager, writing for Seeking alpha writes “There are extremely few assets that are this uncorrelated with other assets and that makes bitcoin extremely desirable from a portfolio construction perspective. Bitcoin is uniquely positioned to hedge against geopolitical risks but remain unaffected by the macroeconomic factors that drive other store of value assets”

As opposed to all government based currencies, which can be printed arbitrarily, bitcoins are finite. There is a limited amount being created and once that amount 21,000,000 bitcoins are created there will be no more created. This is important because this takes away government ability to dilute our monies. The United States Dollar Lost over 93% of its purchasing power since 1933. The United States Federal Reserve allowed over 5 Trillion US Dollars to be added to the money supply. Investing in cryptocurrencies may present a great potentially of helping investors to hedge against dollar devaluation and inflation.

Bitcoin and other cryptocurrencies have provided an unprecedented growth opportunity for the investor. Past performance is not an indicator of future results*. Until recently, there has not been an IRS approved method for investing in bitcoin with an existing retirement account. Bitcoin itself has risen roughly 16000% since its creation with litecoin and ethereum increasing over 5000% each this year alone. Many investors feel that they are missing out.

Great news! You can now use an existing IRA or other qualified plan to secure a position in cryptocurrency. Volatility is extremely high however and therefore recommend that no more than 5-10% of an overall portfolio invested into cryptocurrency.

Money, in general, is nothing more than a system of accounting. It is a way to record who owns what, who owes what, and what taxes or fees are due. The ultimate goal of cryptocurrency is to eliminate the need for a third party such as a bank or government from having to authenticate the value of the money. This in turn will lower the fees associated with having to use those institutions as a third party and, in theory, remove the aspect of inflation from the money supply. Owning a cryptocurrency such as Bitcoin and others, allows the owner to not only carry their wealth with them at all points in time, but also to transfer that wealth all over the world for fractions of the typical cost and without the need of a bank. This means the 4 billion people without access to a bank or system of exchange can now interact with the global marketplace like never before.

Much as the evolution of the internet and technology have totally transformed every single aspect of our daily life, so should bitcoin and blockchain technology redefine and reshape almost every aspect of finance and business application as we know it. The scope and power of this may not pay out for many years to come, but this will give rise to new technology that we have never seen before. This means, among other things, that to a sharp investor, the benefit of a long term position in cryptocurrency can not be overstated.