Metacoin

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Et Tu, Crypto?

It’s March 15, 2020. I’m trying to answer a whole host of questions. Some are serious:

  • Are we going to stay away from this virus?
  • How will bloggers, writers, and entrepreneurs like me make a slowdown work financially?

Some are less than serious:

  • What is the best recipe for a “Quarantini?”
  • And what about a “Cryptotini?”
Glass of mysterious alcohol, plus an orange peel, and some ice.
“Just throw some liquor, an orange, and few ice cubes in a glass…and hope for the best.”

But, in the spirit of this blog (“making sense of crypto” is kinda the mantra), the questions we’ll ask today — and attempt to answer — are all Bitcoin and crypto in nature. Here goes:

Have We Hit “Bitcoin Bottom?”

Price swings in Bitcoin from March 12.
It wasn’t THAT bad, was it?

Well, to answer the question in the caption, it WAS that bad. Like REALLY bad, actually. THAT IS A 43.3% DROP.

But to answer the bigger question…

Nobody knows. $4185.21 might appear to be a bottom — FOR NOW — because, as of this writing, we’re at $5373.35. We’re bouncing around in the $5100-$5500 range for the past day. There’s some stability. But there’s also that “flight to safety” question that we asked forever ago: Is Bitcoin Digital Gold? (And yeah, forever ago was two weeks back.)

Is What’s Happening Outside Really Impacting Crypto Prices?

One theory — not my theory, had been espoused elsewhere, most notably by vagabond entrepreneur and crisis investor Doug Casey — is that prices aren’t impacted by anything other than rogue traders (Chinese? North Koreans? Both?) who are dumping their ill-gotten gains for cash.

Another theory — probably works in parallel to the above — is that whales are using the drop to dump their Bitcoin and Ethereum on unsuspecting noobs. Then they’ll buy the same coins back at lower prices, with a plan to lather, rinse, and repeat as the days go by. (And as people get less and less certain of what’s to come.)

What’s a Crypto Investor — or ANY Investor — to Do?

Hey, here’s where we can go back to the basics. And these basics make sense for ANY investment — you are entering an uncertain time. You don’t know what will happen next, none of us do, and that’s okay. Consider the following as advice that is worth the paper it is printed on.

  1. Remain calm. It’s a dog-eat-dog world out there — and, if you’re Norm Peterson from Cheers, you’re wearing Milk-Bone underwear — and having a steady hand is going to help a ton.
  2. Assess where you are and where you’re going. Some may need money immediately and don’t have time to play the game of market timing (as has been said often, nobody rings a bell when you hit the bottom). Some may have a little extra to set aside for crypto projects. It all depends on where you plan on being in a month, in six months, in six years.
  3. And, if you can, play the long game. We wrote about that a while ago and we’re still there: playing the long game is going to get you farther than anything else.

Links to Help You…

These are of course AFFILIATE LINKS and if you use them to open an account and make a qualifying purchase, we’ll get a commission. But two long-game tools we’ve been using are…

  1. Coinbase. Dave’s Affiliate Link. They have recently started letting you make regular purchases to “dollar-cost average” your way into crypto. 50 bucks or so, a couple times a month might be all you need to get your feet wet.
  2. Crypto.com. Dave’s Affiliate Link. We have more in this account of late than in our Coinbase account, partly because of the nifty debit card option.

In any event — prices up, prices down, rock bottom, Moon, etc. — we’re here to help. Stay Sanitized.

On Bitcoin $7000, Bitpetite SCAM, and Crypto Legitimacy

First of all, if you’ve been following this site, you know that we try to be as up front as possible. If we see a scam, we’ll point it out. We encourage you to do your own research (DYOR). We are adamant that you should not invest more than you can afford to lose. And we stress, sometimes in bold and italics, that this is all an experiment.

We took a break from blogging for a couple weeks – some of that was to be in our version of a decompression chamber of sorts. Let’s watch the action, let’s watch our baskets of eggs, and let’s ensure that we get our house in order in the background. In our absence – our last post on Bitconnect was on October 17 – we saw a couple things happen, and we’ll try to break them down for you now.

BTW, this might be as good a time as any for the only banner ad we can run on the site right now – that’s right, we’ll talk about how we, too, were scammed by Bitpetite and we’ve had to go back and scrub their ads. So here’s an AFFILIATE LINK for BITCONNECT. DYOR. Don’t invest more than you can afford to lose.

Thing 1: Bitcoin $7000

Hitting $7000 (USD) per Bitcoin seems like a really big deal, given our collective propensity to fall in love with large, round numbers.

Then, if you look back at past posts that talk about our BRED Portfolio, you’ll see that Bitcoin was at $4365 on October 1; this means that you could have brought home a 60 percent gain on your money in a shade more than a month.

That makes it a really HUGE deal.

Then, if you factor in the Bitcoin Cash (BCH) price plus consider the fact that one Bitcoin on January 1 of this year was $973, you’re actually sitting on at least a 6x return.

That is HUGH. MONGOUS.

But, in some respects, it is beside the point – the price of BTC doesn’t matter so much as the number of BTC you are able to accumulate.

You could possibly say that about dozens of coins or tokens – yes there will be some wheat and lots of chaff, but the super, blight-resistant, able to feed millions with one stalk kind of wheat that will emerge will be so valuable that the kings and queens of this new economy won’t much care the USD price.

Seriously – there’s a oft-repeated belief in the Bitcoin world that BTC is, indeed, going to $1 Million. Won’t be next year, in all likelihood (though stranger things have happened), and may not happen in the next twenty years. But it will happen.

We’ve had people ask two things: (1) is it too late to buy? and (2) is this a bubble? I’ll answer the first: no. Actually, let me be more emphatic: NO. If you’re not in the game, you’re not in the game – and because of the beauty of Bitcoin, you can drop $100 and get started and maybe trade a little or sock it away or whatever. (We recommend Coinbase, here’s an AFFILIATE LINK, and your $100 investment will get you a $10 bonus, something we’ll also get.)

But, wise sages at Metacoin HQ, is this a bubble?

Maybe it is. Maybe it isn’t. In some respects, that is not the point here – the point is that we are in accumulation mode, it’s a landgrab of sorts, and whether Bitcoin goes to $1 Million or drops to $1 might be beside the point. Here’s why:

Because of the way Bitcoin itself was set up and is structured and governed, 21,000,000 is the cap. No more will ever be issued.

While some are asking the bubble question, others – countless others – are building businesses and services and solutions that keep the Bitcoin movement alive and thriving. Bitcoin may end up being used to pay for cups of coffee, or it may end up being used to buy SUVs, or it may be replaced by an even better coin that is ubiquitous. In any event, if the price crashed today, the entire system wouldn’t immediately crash. Miners will still mine. Traders will still trade. Speculators will still speculate. If you think of Bitcoin as a country that has launched a brand new currency, maybe ask if anyone is using that currency or has the potential to use that currency. In that respect, we are just getting warmed up.

In other words…get in the game. Now.

[QUICK “SPONSOR BREAK” – If you haven’t signed up for the POW Token “Airdrop,” it’s not too late. Use this AFFILIATE LINK – POW Token Airdrop – then get ready for the next airdrop, coming next week.]

Thing 2: Bitpetite SCAM

Did we mention lately that this WHOLE THING is AN EXPERIMENT? Well it is.

As we’ve told you here a few times, we’ll put some of our own capital at risk with some of these Passive Income Platforms that we discuss. And, well, there seems to be a pretty below-average track record for these. Is it our luck? Is it the nature of the beast? Is it a combination?

The latest to go belly up is Bitpetite, and we’re annoyed – but not surprised. In fact, because of our experiments with Ambis and Control Finance and Bithaul, we have made it a habit of taking coins and tokens out at every opportunity. We encourage you to do the same.

We’re going to keep experimenting and putting our money at risk AND STRESSING THAT YOU SHOULD DO YOUR OWN RESEARCH AND PAST PERFORMANCE DOES NOT INDICATE FUTURE RESULTS.

We now have just one PIP that we’re using – Bitconnect – but we’re looking at a few more. Stay tuned.

Bitpetite is gone – and we apologize for linking to it and promoting it. As we said, it’s an experiment. These things could fizzle.

This gives us an opportunity to suggest that you spread out your risk. It’s really the only way to go – multiple baskets, multiple investments, and multiple streams of crypto income.

Thing 3: Crypto Legitimacy

Honestly, there may not have been a better piece of news than the CME group announcing that Bitcoin futures would be available by the end of the year. In fact, that alone might drive the legitimacy that the Winkelvoss brothers were waiting for when they applied to have their ETF traded.

We cannot underscore enough that, even if there’s a large pullback in the price of Bitcoin, and if Ethereum and Litecoin and Ripple and a bunch of altcoins follow…it might not matter a ton because Bitcoin, blockchains and cryptocurrencies are, indeed, here to stay.

We’ll give you one brief example: we’ve been talking about POW Token a bit, and one of the things that we’ve done on the site is “validate” users. We do this for small numbers of tokens – but we’ve also learned a ton about where these folks are coming from.

To validate folks, we have to click on their Facebook profile and find evidence that it wasn’t a Facebook profile that was just recently created to get free tokens.

And…they’re not. But that’s not the point: these folks are from everywhere. Asia. South America. Europe. The Middle East. Even a few Americans!

Whether or not POW Token will become the next world beater is not actually the question to ask: it’s whether or not cryptocurrencies have hit critical mass (they have) and whether or not there’s the potential for value to be exchanged and these things are easy to use (they are).

The takeaway? Folks, with all this…the belief is that we are just getting started. So glad you’re along for the roller coaster ride.

Getting Started (Redux)

Several weeks ago, we posted a few ideas to get you started with cryptocurrency. You know, Bitcoin, Ethereum, and some of the other coins and tokens that we discuss on this here forum.

We thought that we’d spend some time today revisiting that idea: How Do You Get Started?

Our goal today is AN ACTIONABLE LIST. A few things to possibly whet your appetite.

We have a few ideas below – and, since this continues to be an experiment, some of the links are going to be different from the last time we did this. As usual, we’ll include a few AFFILIATE LINKS with this post (so we may be compensated if you take some sort of action, like signing up, buying currency, or investing) and we’ll be as blatant as we possibly can when we share one.

Let’s begin.

An Airdrop and This Will Cost You NOTHING

We talked about this “airdrop” last week and it’s still going on. Here’s a link to the POW Token webpage. Simply put, you sign up with your Facebook credentials and the token creators give you a bunch of tokens (or coins).

We have been asked “Why Are They Doing This?” and the best answer to that is that there’s value in a widely distributed network. While the creators make some…interesting…claims on their web page, there is something to the fact that a network with a million people using its product will be much more valuable in the long term than a network with just 30,000 users (which is where it stands today).

For now, think of this as a Western US land grab, and you’re putting stakes in the ground and hoping that it becomes fertile farmland in the future.

Coinbase – STILL the Fastest Way to Get Started

This one will cost you money, but one of the beautiful things about Coinbase (AFFILIATE LINK) is that, for Americans at least, there’s a decent amount of seamless integration between traditional banking and this new economy. The AFFILIATE LINK gives you a $10 bonus (paid in Bitcoin) if you spend $100 on any combination of the three currencies they offer (Bitcoin, Ethereum, or Litecoin). (And once you join in, you’ll get your own link and can invite others yourself and possibly be compensated…which is cool with us.)

Trade Coins on an Exchange

While there are a few established exchanges that we’d suggest – Bittrex, Cryptopia (AFFILIATE LINK) and Poloniex are three that we currently use – you should also consider signing up for one of the newer exchanges, too.

  • Altcoin Exchange (AFFILIATE LINK) may very well be lucrative for you – we know that other exchanges that started this way (through referrals) compensated their early adopters rather richly. Use our AFFILIATE LINK over there, and then start referring others yourself as you see fit.
  • WCX  (AFFILIATE LINK) is another one, with an ICO coming in a few weeks.
  • COSS is brand new. Not an affiliate link, but we do like the fact it’s based in Singapore and has developers throughout the world.

Passive Income Platforms

Yes, we have been talking A LOT about Passive Income Platforms, or PIPs, that can help you profit with limited amounts of effort. We currently recommend two of them – that’s not to say there aren’t others that are worth your time and investment, but these are the two that we (1) have experimented with and (2) have not let us down.

DO YOUR OWN RESEARCH! Seriously, with any of these, your coins could end up in a black hole of nothing. Don’t invest more than you can afford to lose.

  • Bitconnect (AFFILIATE LINK) is beautiful, we think, because it is backed by an actual coin, one that has a large market cap (as of this writing, around $1 Billion). The odds of it disappearing are small.
  • Bitpetite (AFFILIATE LINK) acts more like a mining platform, in that your “investment” will not be returned to you. However, we now have a nine-week track record of daily payments from the site; note that payments are larger during weekdays than weekends.

An Actionable List?

That’s our hope. You can spend a couple minutes on the first one and it costs you nothing, then, if you’re ready to invest some real money, you can consider trying the other ones out.

In any event, don’t invest more than you can afford to lose…once you get started in this world, it might get a little addictive.

11 Ways to Get Started Now

Get Started Now

Just like anything else, at first the whole concept of Bitcoin, the Blockchain, and cryptocurrencies can seem really overwhelming.

Imagine walking into a shopping plaza in a foreign country, not speaking the language, and not really knowing what any of the products are. That’s this space…at first.

But once you get the hang of some of the concepts, it’s not that bad. Really.

In that vein, we present a post that could actually be an ebook. It’s called 11 Ways to Get Started Now.

DISCLOSURE: some of the links on this page are AFFILIATE LINKS, and we’ll do our best to blatantly identify them as AFFILIATE LINKS. That means we may be compensated if you set up an account or make a purchase.

Here goes:

1. Get a Coinbase Account

Let’s face it, there are really two big categories of Bitcoin users: the hardcore ones – mining rigs in their basements, wallets on all sorts of machines, exhaustive lists of which coins are PoS and which are PoW – and there are those who just tuned out at everything you just read.

If you’re in that second camp, Coinbase is for you. (THAT’S AN AFFILIATE LINK.)

(If you’re in that first camp, you might actually have started with a Coinbase account, but you don’t want to admit it.)

Coinbase offers the most silly simple service you can use to get into Bitcoin – or Ethereum or Litecoin; those are their three currencies as of right now – and you can link it through a US bank account or a credit card. (We are based in the US, so we

Note that Coinbase will actually give you a bonus of $10 worth of Bitcoin when you set up an account, so using our link actually benefits you as much as it benefits us. (But it probably benefits you MORE than it benefits us, since you are now “in the game.”)

2. Transfer some of your funds to one of our three favorite exchanges

First, let’s explain an “exchange” vs. a wallet/purchase platform such as Coinbase. Simply put, exchanges where you can trade cryptocurrencies are like stock exchanges were you buy and sell stocks.

Dozens of exchanges are out there, but we have so far only used three:

  1. Poloniex. We used this one first. “Polo” is based in the USA. Most of the largest coins by market capitalization are traded here.
  2. Bittrex. We started using this one a month or so after we started with Poloniex. It, too, is based in the USA. If you hear about a “small cap altcoin” (small market capitalization, alternative to Bitcoin) that isn’t traded on Polo, it might be traded on “Trex.”
  3. Cryptopia. THAT’S AN AFFILIATE LINK. It’s based in New Zealand, so if you want to feel all exotic, trade there. Speaking of exotic, we’ve got a decent chunk of small cap altcoins over there. “Topia” is their common abbreviation.

Ask people about their experiences with these and you might get a varying degree of answers; our own experience has been just fine.

3. Get a Steemit account…get paid to blog?

I’ll admit, this is the most fun I’ve had with any site since the early days of Twitter. Steemit is pretty cool – you’ll find all sorts of people there, with all sorts of interests.

It’s a social network that is powered by a cryptocurrency of its own, Steem. You’re given a certain amount of “voting power” and you earn more power through more interactions. It can get a little complicated, but suffice it to say you can start to see some results – a few dollars here and a few dollars there.

I don’t do it for the money, though – I’m there to trade ideas with others, and to find out what folks are thinking a bout a variety of topics.

4. Investigate coins at CoinMarketCap

CoinMarketCap.com, or CMC, is the leading site for getting a snapshot of what is happening with cryptocurrencies. Pretty much all of them are listed here, they’re ranked by market cap, you can see what’s trending up or down or sideways.

Here’s where you can keep track of the Crypto Unicorns (those coins with a market cap of $1 Billion or more), all the way down to the tiny market cap coins that, again, seem to dominate our Cryptopia account.

Crypto The Unicorn

5. Start Lending at Bitconnect

We did a pretty big write-up on this one last week. That write-up includes several AFFILIATE LINKS, but if you want to cut to the chase and just get started, here’s an actual banner ad you can click on.

In our post the other day, which we tried to make “warts and all” in nature, we did mention our skepticism around this lending platform. As with ANYTHING in this space, remember to do your own research, to seek the advice of tax professionals and accountants, and to not invest more than you can afford to lose.

We still consider Bitconnect to be rather speculative in nature; but we’ve also studied the coin behind the solution, and it has a large market cap ($540 million-plus) and we don’t think the coin itself is going anywhere.

6. Lock up some coins in DOT at Cryptopia

If you tend to be impetuous with your trades, you might want to consider cooling off a little – and one way to do that is to lock some coins down in an interest-bearing coin such as DOT, which helps to fuel Cryptopia. (AFFILIATE LINK over there.) For a minimum term of 90 days, you can receive interest at 0.5%, compounded monthly, with higher rates for longer-term deposits.

Once you’re on Cryptopia, you’ll need to mouse over “More” and then “Term Deposits.”

7. Buy a Trezor, store your coins offline

Trezor
What it looks like…

We love this little device so much that we joined its AFFILIATE PROGRAM (here’s the link).

What you’re doing is moving the keys for the coins you own (that are supported by Trezor) over into cold storage, on a device that you own that can’t be corrupted.

If you have a decent amount of coins, you’ll want to explore Trezor.

8. Invest in an ICO

With all the news surrounding ICOs, you wonder why we have this so far down the list. Well, ICO investing is A LOT of WORK. You want to research them thoroughly, and you’re still making a leap of faith.

Hands down, ICO Countdown is the best service for this.

We’ve got an okay track record so far getting involved in ICOs, but one thing that gets in our way as an American site is that we’re Americans. Some ICOs won’t let you participate if you’re an American citizen or even an American expat living abroad.

9. Visit the Bitcoin news sites

The ones that we like the most are Coindesk and CoinTelegraph. Both may, at first, seem over your head. That’s okay. We’ve got to start somewhere.

bitcoin meme

10. Set up an Automatic Investment Program

This is one of those super-simple ways to “set it and forget it.” Just hop on over to Coinbase and, when buying your next batch of Bitcoin, Ethereum, or Litecoin, ask to repeat that purchase daily, weekly, every two weeks, or monthly.

You’re “averaging in,” or “dollar cost averaging” your crypto purchases, so that’s another way to smooth out your returns and your risk.

11. Think about a Bitcoin IRA

Yes, that’s a thing. Bitcoin IRA is the world’s first and we’re sharing this link as a public service – we’re not in their affiliate program and we haven’t gone this route ourselves. Yet.

You can search and find a few other links – some ads, some not – but, in our limited investigation of these, this appears to be the best and most reputable service.

Wow. 11 Ways to Get Started. We’re exhausted now, so we’re going to take a break. But you…you should really consider getting started…look around and consider getting into the Bitcoin game.

 

 

DIY: Your Bitcoin Hedge Fund

Bitcoin Hedge FundIt’s time to update our Bitcoin Hedge Fund, which we told you about back in May. Before we do that, though, this reminder: we DO have a Facebook page, we ARE on Twitter, and we’ve been spending a ton of time over on Steemit. We’d love to have you join in on the conversation in any or all of the three.

And away we go…

Hedge Fund Background

First of all, the typical standard disclaimer: do your own research. We’re not responsible for gains or losses. Get legal, tax, and accounting advice. Don’t invest more than you can lose. These are volatile-as-f markets, y’all. Really volatile, especially the past several days, where there was at least a little bloodletting and panic.

Anyway, our original post said we’d park a small amount – in our hypothetical fund, we chose a guy named “Herbie” and his hedge fund (“Herbie’s Hedge Fund”) had $10,000 to invest. We chose this amount as ten percent of his investment capital. Is that a good amount? A bad amount? Too high? Too low?

Heck, that’s for you to decide. If you’re Wences Cesares, you’d put 1% of your net worth in Bitcoin and leave it there for several years. That may turn out to be good advice, or it may turn out to completely fizzle.

What We Started With

Our hedge fund had a nice mix of established coins – the BRED portfolio, of course – as well as some emerging coins and a recent ICO. Here’s what it looked like then:

If you have more than a passing understanding of the markets we’re in, you might think every one of those coins has gone up since May 1. And you’d be almost 100% right: using today’s prices, grabbed from CoinMarketCap.com, here’s what you’d have:

Hedge July 13

Some notes on what we see here:

Bitcoin: Holding Steady

Bitcoin is doing well enough, and it started as 30% of the portfolio – for reasons detailed in May, but, if it’s becoming the reserve cryptocurrency, then yeah, you want a good chunk of it.

What will be interesting, though, is where it goes in the next 20 days or so. Hard Fork, Soft Fork, stuff that even we admit we’re paying attention to but not studying THAT closely – the August 1 deadline date for Segwit-related movement on the part of the BTC-hemoth will mean movement in price not only of BTC, but perhaps of others in the BRED portfolio…and LTC, too.

Timing on LTC, DGB, XRP: Not Bad!

From the “blind squirrel” department, all three have done well. Litecoin was, indeed, a defensive play – you could argue that it belonged in our BRED portfolio – some folks have told us so – but it’s (in our eyes) a bit like Bitcoin and a bit like Dash. But it’s also seen as a Bitcoin alternative, so that’s why it’s here. And it has nearly doubled in the past five weeks.

And some of our success is a little bit of luck – we thought we could be too late to get into Ripple’s XRP token, but it turns out that quadrupled for us.

Digibyte went on a tear, then pulled back and is now back down to Earth – if Earth is an 11x growth in its price.

And, About Our Laggard

Win some, lose some. WeTrust is still a good product/coin/token/system/platform. And we’ll keep it here because we do think that it has tremendous potential.

But two things do jump out at us here at Metacoin HQ:

  1. We picked the wrong ICO.
  2. We are also missing out on a number of these ICOs because we’re in the USA.

A Word on ICOs

Initial Coin Offerings used to be all the rage a couple weeks ago. Then Ethereum pulled back and cries of bubble were everywhere.

THEY’RE BACK.

That’s one we missed out on entirely because we’re in the USA and these will not let Americans get involved. You have to wait until they are traded on an exchange…

That could actually be a good thing – if an ICO is oversold, overblown, and overhyped, it will more than likely fizzle once it hits the markets, creating a buying opportunity for mere mortals, er, Americans.

But, and this is a message for Congress as they look at tax reform, and maybe, too, a message for the SEC: as long as there’s a ton of caveat emptor attached, what really *IS* the problem with these ICOs being open to American investors? How are they any different from, say, my deciding that Blue Apron is awesome and I want to bet my IRA on the Blue Apron IPO?

Food for thought.

Two More Things

One – our hedge fund actually looks a bit different today than it did on July 1.

Hedge July 1

Yeah, $7,000 down since July 1. This is why we updated the numbers on July 13 – it’s a more accurate picture of what’s happened over the past 12 days.

Two – your own hedge fund. We told you before that this is a hypothetical experiment and you can use this as a guide for creating your own. However, we like the basic principles here: some big coins, some smaller coins, maybe an ICO or post-ICO coin or token or two. The general idea, as always, with a hedge fund is that you want to hedge your bets.

Overall markets – stocks, bonds, mutual funds, precious metals, pork bellies – those could tank tomorrow, or explode tomorrow, or trudge along. If you have all of your eggs in one basket, you’re likely going to have trouble someday. And if you have all of eggs in the wrong basket, that could spell trouble, too.

Love to hear your ideas! Tell us on Twitter, or in the comments below.

Oh, if you HAVEN’T gotten some coins to get started, pop on over to Coinbase, use this Affiliate Link, and you’ll get a Bitcoin Bonus with a qualifying purchase.