Metacoin

Covering Bitcoin, the Blockchain, Altcoins, and Fintech

Ethereum

Crypto: Down. Stocks: Down. Inflation: Up. So What Do You Buy?

Here’s yet another post with a couple blatant caveats: (1) THIS IS NOT INVESTMENT ADVICE and (2) NOBODY KNOWS WHAT’S GOING ON.

We’ve had a couple weeks here in CryptoLand. You name it, it’s down. Take our 2022 Growth Portfolio: a hypothetical $10,000 investment with $1,000 each in ten different crypto assets. Thank God it’s only hypothetical.

Screenshot from May 20, 5:30 a.m. CDT

It was a bloodbath. It still is kinda sorta a bloodbath, in that nobody knows if BTC saw the bottom, or if ETH’s move to Proof of Stake (known colloquially as “The Merge”) is going to be all that, or if stablecoins will stabilize.

And whether or not you’re better off throwing darts.

At Least the Stock Market Is Okay, Right?

Let’s answer the question in the meme with a screenshot.

Stock market, one-month performance.

The problem, though, is that to keep propping up the stock market, The Fed is going to need to thread the needle on interest rates. Too much of an increase and the stock market tanks. Too little of an increase and you can’t catch up with inflation.

So you’re painted into a corner because the stock market is so important to everyone’s 401(k) plan and the inflation rate — which is caused, DUH, by ALL THAT PANDEMIC MONEY PRINTING — is so important to everyone’s standard of living that it really REALLY stinks to be Jerome Powell right now.

Now, Let’s Talk Inflation. Cue Karen Carpenter…

“We’ve Only Just Begun…”

As David Stockman — President Reagan’s former Budget Director, native Midwesterner (shout-out to Michiana!), and future guest on my YouTube channel (call me!) — told us on Doug Casey’s Dispatch a couple weeks ago, we are collectively screwed. And it’s mostly thanks to central bankers.

That part about J-POW having a rough job is not an understatement; the corner we have been painted (printed) into is troublesome. Investors don’t know which assets to invest in, and the average Joe is more worried about real-life things like gas prices or the cost of food.

So…What DO You Buy?

We follow a few financial people on Twitter, on YouTube, and elsewhere. We’re nailing Jell-O to a tree here.

Here’s Joe from Heresy Financial, telling us (SPOILER ALERT) that Treasurys might be the way to go. Here’s another YouTuber — one we found from typing in “where to invest 2022” into the YouTube search bar, then going with the first one we found from the month of May — suggesting individual stocks. And here’s CNBC, taking a break from its “How This [NUMBER] Year-Old [JOB DESCRIPTION] Made [LARGE AMOUNT] By [ZAGGING WHEN EVERYONE ELSE ZIGGED AND/OR INHERITING MONEY]” template (shown here) to give us a whole host of ideas of where to invest in an inflationary environment.

Feel free to grab any of these ideas and batten down the hatches, right?

We’d refer you back (AGAIN) to our series called SHTF. Volume 1 is here and Volume 2 is here. But these are *mostly* crypto-related ideas (with a break for some precious metals and cash on hand). And that isn’t even guaranteed, if the last few weeks are any evidence.

TL;DR: See Elmo

Elmo Fire

Buckle Up. Good Luck.

Creators Gotta Create (and Announcing Our New Collection)

We saw a maxim somewhere on the internet and decided to share it: “Be brave enough to suck at something new.” If the web3 explosion has taught us anything, it’s that there are completely new ways of making a buck — and creators (like you, perhaps?) are learning new and interesting tactics along the way.

And some of us — maybe some of you — weren’t very good at it to start. We get better: the more you write, the more often you write, the better you become at writing. The more you make music, the more often you make music, the better a musician you become. We could go on…

We Are Onto Our 4th NFT Collection

A year ago, we started sucking at something new here: our first collection of NFTs. (The first one is here, created on March 14, 2021.) Called the “Obvious Statement Collection,” the goal was to come up with a few pieces — we’ve created 25 of them so far — that told you something that was, well, obvious. (And maybe semi-controversial, like the statement below.)

Collection two, “One Hundred NFTs,” was perhaps a little better but, as art goes, it ain’t great. Three, though, we’re especially proud of: #Sketches2021 is its name (see below about the giveaway!) and here’s a link to all 256 of them: Sketches 2021.

So it’s time for our fourth collection. We’ve entitled it “Collezione” and the plan is 256 pieces (again; that’s a nice number that is definitely attainable.) 26 of them have been created so far. And we’re pretty pleased with how they’ve turned out.

w123 in the Collezione series

We’re Giving Two NFTs Away!

So here’s what’s up with the giveaways*: All you have to do is follow the instructions below by March 31. We’ll pick two at random and one will get a piece from Sketches2021 and one will get a piece from Collezione. Those instructions…

  • Follow @teammetacoin on Twitter or Instagram. (You can do both to increase your chances!)
  • Like at least one of our posts from between March 20 and March 24.

On April 2, 2022, we’ll select one Twitter follower and one Instagram follower at random (* here’s where the asterisk comes in, as this is not a sweepstakes or contest or the like, all decisions final and it’s a gift and there’s no cash value) and we’ll send them a DM and they’ll respond with their ETH address and enjoy their new artwork.

Good luck! Now go create something.

Inflation.

18 months ago, right before the Presidential election, we wrote a two-part series that got a little bit of attention. In it, we discussed a strategy for when things get pretty bad.

Part One (go here for more: SHTF Part One) is probably more endemic to today’s news of an inflation rate that has the risk of spiraling out of control than Part Two.

But, to be honest, we didn’t think, even back then, that we’d see 7.9 percent year-over-year inflation. In the United States.

(Thanks to tradingeconomics.com for the chart; month-by-month figures going back to Jan. 2017.)

The U.S. Dollar Is…Get This…An Inflationary Asset!

To paraphrase George Costanza’s risk management tapes from the show Seinfeld, “in order to understand ‘inflation’ we must first define ‘inflation.'”

When you print way too much money, you get inflation. “Inflation is, always and everywhere, a monetary problem,” according to Milton Friedman. You can throw blame at whichever President or Congress you’d like (they’re all guilty, as we learn in this balanced piece from the website The Balance), or whichever crisis you’d like (though, to be fair, the Federal Government printed a metric crapton during COVID).

Don’t Believe The (Putin) Hype

Listen to Chuck D.

Don’t listen to Joe B.

The seeds were sown ages ago — like, probably three or four Fed Governors and Presidential Budget Directors ago — and the reality is that Vladimir Putin is a mere scapegoat. Gas prices are rising, but they’re not totally his fault; and the rise in food prices to come will be due, in part, to Putin’s war.

But you could get into a host of academic arguments and ask who bears the most responsibility and it won’t solve the problem.

‘Bitcoin Solves This!’

Yes, and no. And maybe.

As Putin’s War Machine and his “Evil Cronies” are learning, if you can’t use the global financial system that exists — if you’re shut out of traditional banking — you have to make do. In Putin’s case, that means calling China. In your case, that means…well, that means a few things.

First up, you’re not Putin, planning on invading another country. But you don’t know if or when you will fall out of favor with the traditional banks. (See “Trudeau, Justin” for an example of just how that could happen to you.) You also don’t know exactly how bad this inflation stuff will get — and you could find yourself using the black market (WHAT???) before you know it.

Seriously.

Venezuelan Black Market Finance

If you live in Venezuela, you have been dealing with this sort of thing for a while. There’s an official exchange rate, then there’s an unofficial black market rate. And there’s always the risk of the government revaluing the currency.

Zimbabwe had to do this, too, creating a 100 Trillion Dollar Bill back in the day.

And on and on…

Upshot: Get In The Game

You don’t know when the time will come where you need some of that stuff in the post — Cash, Precious Metals, some BTC through Coinbase or Crypto.com, and some ETH too (THOSE ARE AFFILIATE LINKS OVER THERE, WE COULD BE COMPENSATED IF YOU SIGN UP THROUGH THEM) — and you don’t know when it might…hit the fan.

But standing on the sidelines, now, is not an option.

NGMI: Why You Should Sell It All And Become A Monk

You don’t really think we’re gonna make it, do you?

Internet sub-cultures are a wonderful thing. Sometime last year, a combination of NFT purveyors and OG crypto traders started to adopt the phrase “gm” as a means of wishing each other “Good Morning.” It’s really a fine line here. Do it right — simply use the two letters, don’t use capitals, don’t repurpose the General Motors logo — and you’re part of the crowd. You’re Shiv and Tom in the screenshot below. Happy. Complete. Enjoying a good time. Celebrating life.

Do it wrong and you’re Kendall Roy, the punch line of the joke everyone but you is in on. (Watch the video. Cringe with us.)

Shoehorning a Succession reference into a blog post notwithstanding, “gm” evolved and “WGMI” was added shortly thereafter — at least by my measurement of the timeline, which could be off a hair, don’t hold me to it, DYOR and all that — to underscore the optimism that the crypto and NFT communities bring to the world. We’re Gonna Make It.

OR “Ain’t No Stopping Us Now,” as both McFadden and Whitehead reminded us sometime around 1979*.

We’re Gonna Make It! The optimist is on board: crypto is the future! NFTs are adding value to the economy and giving artists new life!

The pessimist reads the asterisk below.

* IIRC, the song was adopted by the 1979 Baltimore Orioles as their answer to the 1979 Pittsburgh Pirates’ choice of “We Are Family” by Sister Sledge. The Pirates came back from a 3-1 deficit to defeat the Orioles in the 1979 World Series; I won 50 cents off my Dad.

Which Brings Us to Our Point: NGMI

Shortly after either learning about the WGMI acronym or reading about the untimely demise of Messrs McFadden and Whitehead, new lingo was created: NGMI. Not Gonna Make It.

How Bout That Portfolio?

Egads! That kinda stinks, right? We launched the Growth Portfolio a couple weeks back on this here site and our goal was to give you, Gentle Reader, a basket of those coins that can give you the best opportunity for potential success. Big coins, mid-sized coins, up-and-comers that are taking advantage of the NFT-based web3 economy: it’s all there!

And it’s getting pummeled, as is everything else.

The Biggest Dogs

BTC is below $40,000, ETH has dropped below $3000. The end is nigh!

This Blog Post’s Title Is Tongue-in-Cheek

We really don’t know how to make sense of this market the past couple weeks. Our own holdings are down nearly a third since the beginning of the year. We won’t even begin to call a bottom, or else we’ll look like this guy.

Or we could guess that this guy (below, Fed chair Jerome Powell) will bring new people to crypto writ large through the Fed’s (possible) creation of something called “digital cash:” this is one of those “CBDCs” being bandied about in other countries.

We also *could* start talking about new NFT developments — seems like everyone is getting in on the action, right? — and see that the challenges to OpenSea from Crypto.com and Coinbase probably say we’ve only just begun.

Our Point: Don’t Give Up Just Yet. Or Do Give Up.

In any event, here are a couple concepts to embrace:

  • Do Your Own Research. “DYOR” is one of the acronyms we use often around here. Don’t rely on us to tell you what to do. Sniff out a few other folks, check into CT (“Crypto Twitter”) and find out what people are talking about.
  • Experiment. We’ve gotten in early on a couple coins. We’ve also blown it on a couple, too. (Our stake in this one, for instance, was purchased when the price was about 80 cents each.) And we’ve created a series or two (or three) of NFTs, with limited success. But, again, we’re not afraid of experimentation.
  • Enjoy the Ride. The main reason yours truly is involved in this space is because he finds it bloody fascinating. Not every project is going to be eye-catching to you, not every token launch is going to make sense, and not every bit of lingo is going to be clever. If it’s not fun, then maybe it’s not for you?

gm

Keep at it. Or become a monk.

We’ll be here either way.

A Month Later: Is $ENS the Perfect* Web3 Token?

If you were lucky enough to grab some $ENS, the token from the Ethereum Name Service project, congrats! (If you haven’t but think you may be entitled to some, there’s still time. Go here: ens.mirror.xyz and take a look.) The token dropped into wallets on November 8 and it’s been nearly a month to watch it unfold, so we thought we’d examine a little further.

The price chart has been a thing to behold: if the average user got a couple hundred $ENS tokens, and those are now trading in the low $40 range, an $8000 or $9000 payday is nothing to sneeze at. Pick out your Christmas gifts — so long as they’re not negatively impacted by the supply chain — and rock on!

Not Bad for Playing on the Internet for Three Years

But, long term, is $ENS all it’s cracked up to be?

First, the Background

We actually talked about this in our post from June 2019 called “Playing the Long Game.” Back then, we didn’t really see the prospect of an airdrop coming, we were just looking for a combination of Ethereum Cybersquatting and Finding A Cool Domain Name.

You can register a bunch and they only cost about $5 a year; we registered several and use one of them as our principal registry.

In theory, we could use one of the ones in our stable, like “jamiedimon.eth,” and set it up to give and receive tokens. (Or you could try to sell it to JP Morgan Chase, which the owner of the above coin appears to be doing.) (Note that it doesn’t take an internet super sleuth to figure out that the author of this post owns jamiedimon.eth.)

If you think of these dot-eth domains as your portal to Web3, the metaverse, AND your crypto holdings…that’s a pretty good way to look at it. Now, let’s do a little analysis.

‘I Promise, It’s Perfect.’

That was the tagline from a golf club that was sold in the early 2000s. Called “The Perfect Club,” it could get you out of trouble, like tight lies, and suggested that mere mortals like me (with my handicap of…well, let’s say it’s not pretty) could use it on shots from about 190 yards out and drop the ball on the green with minimal effort.

I don’t remember seeing an asterisk — * — like the one in the headline of this blog post, but it should have come with one. Especially when the announcer himself said “I Promise, It’s Perfect.”

But the question at hand, and where the asterisk leads us, is whether or not $ENS *may* be the Perfect* Web3 token.

Here are a couple reasons — and yes, this is not financial advice and you should DYOR (Do Your Own Research) and we’re not responsible for your gains or losses — why $ENS could be the on-ramp to Web3.

The Analysts Are Taking Note

Van Eck is kindof a big deal. One of their analysts did a pretty solid analysis of what’s going on with Ethereum domain names, the bread-and-butter of the ENS entry point to the rest of the investment world.

We’ll link to Matthew Sigel’s post here, and we found it more than a little interesting (in a good way) that Sigel compares the ENS domain business to Verisign. (We also didn’t realize Verisign was such a stud.)

Van Eck’s Sigel summarizes the dot-eth trend better than we could right here:

Plus the Airdrop Means Fewer People “Heading for the Exits”

Here’s another aspect to look at: when you have projects that make people rich very early — not just crypto or Web3, but IPOs, too — you always run the risk of a “cut and run.” For instance, a Junior Software Developer signs up for a gig at a startup, is given some options, and the startup IPOs. Whenever the lockup expires, the developer gets bored, has high-six or low-seven figures in cash, and heads straight for the exit.

Because of an airdrop that didn’t end up with tons of rich people, and with no VCs taking part, the result is that nobody (aside from the founders, who are in this for the long haul) got super rich. The lack of “F*** You Money” makes this a potential winner.

AND…It’s a DAO

This would be the third reason this is so huge: governance.

DAOs are Decentralized Autonomous Organizations. Simply put, they’re designed to run with limited involvement from management, delegating votes on a variety of governance issues to a team. To collect your $ENS tokens you had to vote on a series of proposals and select a delegate to vote on your behalf.

They’ve built a black box and the management of that black box is in the hands of the team of delegates, but proposals to change the way the black box functions take a majority. And some of it is immutable — like the DAO can’t really go out of business — so they’re definitely looking at this with a decades-long time horizon.

Should You Buy at This Price?

Again, this is not financial recommendation, and do your own research.

But the token itself is right around the top 100 in market cap and it’s just north of $1B. Compare and contrast that with tokens like $SHIB (~$19B market cap as of this writing) and take a look at the functionality of $ENS in comparison with other tokens ($SHIB has a cult-like following and has rocketed upwards, but is it really THAT valuable?).

$ENS might not be a bad bet in the grand scheme.

Good luck.