If you have time, listen to the most recent Lex Fridman Podcast #276 featuring Michael Saylor. You’ll hear Michael talk about the velocity of transactions in the crypto economy compared to the fiat economy for final settlement: “The velocity of money through the crypto economy is 10,000x faster than the velocity of money in the consumer economy.” Amazing, but not surprising, since BTC alone accounts for 350,000 transactions a day.
This sheer volume also explains why bitcoin is up over 300,000% from its beginnings as of this writing, and why I believe it will go up at least 10x in the next 5 years. (This makes me very conservative by the way.) Next target is flipping gold and crossing the $10 trillion market cap. It’s less than $1 trillion today.
We’re also going to see NFTs and the underlying cryptocurrency that supports them, giving them utility, become a thing. Right now the underlying technology standards are equivalent to about 2003, when I was running around with a Kyocera 6035 smart phone running a Palm operating system. However, since both Microsoft and GameStop are getting into NFTs, it will most certainly be a thing and a way not only for status, but identity in the crypto economy.
While the whole crypto economy is very much the wild west and early days, it’s not going to take 10 years for it to completely disrupt commerce as we know it, when you consider all these factors taken together. Even the skeptics I talk to such as partners at the Big 4 consulting firms agree that this technology cycle will evolve even faster than smartphones in 2003. For its part, bitcoin will continue to be the safe haven, final settlement, and store of value for the foreseeable future–especially as it continues on its path to the $10 trillion market cap.
That leads me to the title of this post:10-10-10. A long time ago, when I first got into sales, I learned it's smart to set aside 10% of your paycheck for a rainy day when you may not have a paycheck for a while.
Simply, 10% of net wealth should be in bitcoin as a long term store of value for the next 10 years. Of that 10% basket, you may want to take a flier on 10% short term speculation on other cryptocurrencies like Ethereum and Solana that support NFTs, Web3, and DeFi Finally, inject some fun in your crypto economy play: take another 10% and start spending your bitcoin. Go ahead and buy a frivolous NFT to use as part of a game, club, or a social media brag. Pay for lunch with friends using bitcoin, (Note, I always replenish afterwards.) Or start looking at new ways to support artists and artisans: buy street art from street vendors in crypto. Even send some crypto to Africa, to directly support emerging economies, artists, makers, and families.
If you're like me, you may want to go for 20% or more in crypto holdings, which is actually a more conservative approach in my mind. The odds of a 35% drop in a day like Netflix did today is close to zero. Maybe a 10-15% decline, but if you can hold on through weekly, monthly, and yearly price swings through the next couple of years, you’ll be all the more financially secure.
We are still very early in this groundbreaking economy that moves at 10,000 times the velocity of the legacy consumer economy. It’s not too late to be early. In 10 short years, you will be very happy you made that move.
All the best,
Jim Fox
CEO
Bitcoin Buyers Club