Ethereum

Jun 12 2017

Breaking: Ethereum $400

How crazy is this space? How quickly does it change? Well, for starters, we were up way too early AND worked on a post about Ethereum hitting all-time highs. THEN IT BROKE THROUGH THE $400 BARRIER.

Ethereum = Fire.

Or do we say “straight-up fire?” Any way you slice it, Ethereum is looking like a rocket these days. And it’s a head-scratcher, too: why? Can it be sustained? Should you get some at this price because next thing you know it’ll be $1000 – then $3000?

Here’s the screenshot and graphic thingy that we whipped up…right before the $400 level.

This is starting to look seriously crazy. And perhaps unsustainable. Still…

Flippening?

This is a term that you might not have heard yet – especially if you’re new to cryptocurrency. In brief, Bitcoin is the market cap leader, and Ethereum is second. Flippening refers to the moment when the two flip places.

SPONSOR BREAK: IF you are new…get yourself some coins – Ethereum, Bitcoin, or Litecoin – through this link at Coinbase. You’ll get a bonus, we’ll get a bonus (with qualifying purchase); but, most importantly, you will be in the game and not on the sidelines. You can start with a tiny amount if you’d like. Now, back to the post.

Flippening is being tracked here. It used to be a pie-in-the-sky idea: hey, Ethereum COULD be bigger than Bitcoin. Then, it started to become a real possibility. Now, at 70+%, could it happen this year? THIS SUMMER?

Post-Flippening Idea Number 1

This could end up being much ado about nothing, and that’s our first Post-Flippening idea. Let’s say it does happen, and it happens this year. There’s a little weeping, gnashing of teeth for a while, and maybe there’s UASF and hard fork and Segwit discussions that are over the heads of mere mortals like me.

Post-Flippening Idea (PFI) Number 1: ExxonMobil vs. PetroChina. (WHAT? I’ll explain.) In the 2000s, the largest company by market cap seemed to flip-flop: it was ExxonMobil, then it was PetroChina. Back and forth they went. No biggie.

The world may be big enough for two large players, and Bitcoin and Ethereum each have their own role in this world. This could happen. Pretty feasible.

The question is: which one is ExxonMobil and which one is PetroChina?

Post-Flippening Idea Number 2

Apple. One of these two is Apple.

Once Apple took over as the top company in the world by market cap in the third quarter of 2011, they gave up that spot in only two quarters that followed. Nineteen out of twenty-one quarters had Apple in the top spot.

Apple has been number one since the third quarter of 2013, and it shows no signs of relinquishing that spot.

Is it possible that…well, that Ethereum is ExxonMobil (the only other company since Q3 ’11 to be number 1) and Bitcoin is Apple? I mean, really, Bitcoin IS the dominant coin, it was first to market, and it shows no signs of slowing either.

Or is it possible that Ethereum is Apple, will take the throne, then give it up, then take it back…and not look back?

Only certainty: rapid changes.

Since we started typing this post – a span of about 20 minutes – the price has fluctuated from $380 to $408.12 on Poloniex, and now back down to $382.

Volatility is certain. The Flippening? Not sure about that one.

Jun 01 2017

Turn 10K into 193K in Just Five Months

It sounds too good to be true, right? Make a small-ish investment, of only $10,000, then let it sit and ferment. After five months, sell it all and find yourself with a 19x return: something that others might wait decades for, accomplished in less than half a year.

Welcome to the crazy world of cryptocurrency, and the even crazier concept we created called the BRED Portfolio.

If it sounds too good to be true, are we in a bubble?

Great question, and not one we’re going to answer with this post. Instead, let’s just go to the videotape and talk about exactly how this came about.

First up, in early April – so no, WE didn’t invest in our basket of cryptocurrencies on January 1 – we thought that this world needed something similar to FANG: Facebook, Amazon, Netflix, and Google. These four companies are all synonymous with some sort of internet, web, social, digital, or online business. But they also are a bit – or a LOT – different from each other.

Bringing us to the BRED Portfolio. We needed a catchy acronym, but we also needed four currencies that each had a little bit of a different angle in this emerging space. Enter BRED:

Bitcoin, the ne plus ultra of cryptocurrencies
Ripple (ticker XRP), which is taking on SWIFT and starting to win
Ethereum, and its smart contracts and backbone of a whole host of other launches (like Golem, for instance)
Dash, probably the most “consumer-y” of the cryptocurrencies.

Our idea: what if you had gone back in time to January 1, bought $2500 of each of the four currencies, and left it alone. What would that portfolio look like today?

If it sounds too good to be true, you need a time machine

Here are the results:

Oh. My. Goodness.

What if you waited until April 1?

We re-weighted the portfolio accordingly, buying $2,500 each of our BRED coins. The result is also quite staggering.

So now what?

You probably have a couple questions, and we’ll try to answer them.

First of all: I can’t say whether or not we’re “in a bubble.” No one knows. For each prognosticator that says there’s too much of all of these cryptocurrencies out there, there’s someone else who says that we’ve just scratched the surface.

The answer – as is normally the case in probably just about everything – is somewhere in the middle. Like the dot-com bubble of the late 90s and early 2000s, if it pops, there will be quite a few losers. There will also be a few winners: companies like Google or Amazon that kept it going and emerged and are now beyond dominant.

As for coins, whether there are too many and whether there’s too much supply of all of them: that is another good question. Ripple is a great example – to the casual observer, supply in the billions vs. an all-time capped supply number of 21 million for Bitcoin might sound like it’s a recipe for disaster for Ripple.

But, as has been discussed quite a few places, maybe Ripple is managing its entire currency plan extremely well.

There will be volatility. There will be craziness. There will be a roller coaster ride. That’s expected.

And, if you haven’t gotten started yet???

What are you waiting for? Seriously, you need to think about getting started with at least Bitcoin and/or Ethereum. You can do that by clicking on this AFFILIATE LINK for Coinbase and getting started. You can start small. But we recommend you get started.

May 25 2017

3 Ways to Get Started with Bitcoin Today

I get quite a few questions about this Bitcoin stuff. Like, “How does it work, this digital currency?” Or “How is it more than two thousand bucks for one coin?” Or “How is there so much value placed in something that you can’t even hold on to?”

More recently, I get some other questions. Like, “What the heck are you talking about?” Or “Dude, slow it down just a little.”

There’s a bit of a “rabbit hole” element to this cryptocurrency space – it’s a rabbit hole that I went down last year and really haven’t totally came back up from. And it’s a rabbit hole that got me to make this video:

Yes, it might be over some folks’ heads. Sorry about that.

So, since we all gotta start somewhere, I give you this, the quickest of quick-start guides out there:

3 Ways to Get Started with Bitcoin Today

(1) Thing one is to actually get some of the currency. You can get Bitcoin – that’s the gold standard thing that started this whole space – or one of the other main currencies.

We recommend starting at Coinbase, and we especially recommend using this AFFILIATE LINK to get some. (In this case, the affiliate link will actually give YOU a bonus of $10 worth of Bitcoin if you buy $100 worth of any of the three currencies they offer, which are Bitcoin (it goes by the symbol “BTC”), Ethereum (ETH), or Litecoin (LTC).)

What’s beautiful is that you can get started with a tiny, tiny amount. Got ten bucks? Use the $10 bucks to dip your toes in the water. You will pay a small transaction fee, but, if you were to try to spend $10 on some stock through your online broker, you’d spend probably that much per trade.

(2) Spread yourself out at least a little. (This is not trading advice, consult your investment professional, not responsible for gains or losses.) A recommended approach is to split your initial investment between two coins – Bitcoin and Ethereum – or three coins, adding Litecoin to the mix.

When I started, I started with just BTC and ETH. What I did next is what I’ll recommend for you:

(3) Hang out and watch the space. This means not just reading blogs like this one, CoinTelegraph, and Bitcoin.com, but also looking at the numbers sites and trading platforms to understand what is going on.

Numbers sites? Coinmarketcap.com is our favorite. Coindesk.com is another. These sites cover the numbers of the whole space, and will give you a sense of which coins are trending up or down, as well as the all-important “market capitalization” of each coin.

(You will hear about ICOs, and Smith and Crown does a really good job of tracking those – but you may not be looking for that much granular detail just yet.)

The trading sites make it easy for you to get started actually trading – almost TOO easy, perhaps. Suggestion: go to Poloniex, Kraken, or Bitfinex to take a look at what’s happening. See what’s moving, what isn’t, what’s being traded, and how much it’s trading for.

You may be tempted to play around and do some trading, but you’ll probably want to understand the space much more before you try to make money at it. (Trust us on this one.)

There it is. A 3-Step Plan.

That’s how we suggest you get started. Once you’re ready for the next step, then you can dive much deeper. But if you’re a newbie – and remember, even the experts started somewhere – this will help you get acclimated to the wonderful – crazy, scary, thrilling, but, yes, wonderful – world of cryptocurrency. And Bitcoin.

May 25 2017

BRED Update (Or, How’s Your Bitcoin?)

Cryptocurrency traders are a special lot. They are, after all, a new breed, and the markets they trade in don’t totally act like the stock markets, nor do they totally act like the forex markets.

And the “buy and hold” folks seem to be in the minority, at least if you trust the chat rooms on places like Poloniex.

To wit, the activity the past 24 hours or so shows some serious red numbers. Dropping like flies, those “altcoins.” The sky, she’s a fallin’.

Now what? You moved your hard-earned Bitcoins into something like Ripple’s XRP token and you’ve seen it “plummet” 26 percent in the past 24 hours.

You could be like the guy on this all-too-real Reddit post from yesterday.

I have been a BTC hodler for about 3 years now. Things were good and I believe in bitcoin a lot. When the price was dropping and dropping I kept on buying and buying, for the simple reason that I believe in Bitcoin.

Enter a few days ago: Ripple was on the rise. I thought I could increase my BTC-stack a bit by following the ripple trend. I was stupid and went all in… I should never have gone all in on anything. I’m not all in on bitcoin, so why would I put all my hard earned btc in something I do know little to nothing about, right? Well… enter the greed I thought I had left behind me a long time ago.”

Let’s just say it didn’t end well. A cautionary tale for the day traders and trend riders. And those who don’t hedge. And those who don’t buy and hold. And…

Enough Already: Get to the Headline

Oh yeah, that. The headline today asks “How’s Your Bitcoin?” because that has been the dominant news this week. Yes, even above some of those other coins that seemed to come out of nowhere and jump up by 2x or 3x – I’m looking at you, ZCash – Bitcoin’s rise to above $2,500 each is rather thrilling. Cool, yes, unsettling, maybe.

The BRED Portfolio, which we started tracking on April 1 (it’s ONLY been two months? Really?), takes four of the currencies – Bitcoin, Ripple, Ethereum, Dash – and puts them in equal parts into a basket, with an initial investment of $10,000. (We went back to January 1 so we could look at this from a YTD standpoint, and we’ll give further updates on the 1st of each month.) Its growth has been staggering – but the growth has actually been mostly due to non-BTC assets.

Meaning that Bitcoin is back in the spotlight at the expense of some gains in the portfolio.

So, even with the attention on Bitcoin, the BRED Portfolio is still dominated by the growth of XRP, which is still more than half of the overall $195,821.24.

Is there a lesson here?

Maybe: diversification is good. Riding the waves isn’t. Buying and holding, probably also good – unless this entire portfolio and the crypto universe turns out to be a house of cards, in which case we’re all spinning our wheels.

A broader point, though, is one that we should make: Bitcoin is still “dominant” (this gets tracked – Bitcoin as a percentage of the overall cryptocurrency marketplace, which, according to Coinmarketcap.com, has fallen to 49.3%) AND is still the gateway currency. If you’re getting started, or if you’re trading for the first time, the odds are that you’re trading Bitcoins for whatever you end up with.

Bitcoin is the gold standard, or the world’s reserve cryptocurrency.

Whether it will remain that way for a while? That we’ll wait on.

May 22 2017

Signal to Noise Ratio: Be on the Lookout

It was a busy weekend for cryptocurrency. And, with Consensus – the largest event in the Bitcoin, blockchain, and cryptocurrency industry – getting started this week, you might be in for a crazy ride of hype, more hype, and even more, uh, hype.

Today, we’re going to talk about the “signal to noise ratio” – expected to be heavily weighted this week in the direction of NOISE – as well as what to potentially look for coming out of the event.

Weekend Headline #1: BTC and ETH

First, Bitcoin and Ethereum jumped over psychological hurdles ($2000 for BTC, $120 for ETH), then pole vaulted over the same hurdles, with prices for each reaching all-time highs that might have seemed folly just a couple of weeks earlier.

In fact, we looked at our own screenshot from April 26, where we saw that Ethereum was in the 50s and we thought…WHAT?

This is not unexpected, however: for every case out there that “Bitcoin is overvalued” or “Ether is just a me, too technology,” there seem to be dozens of stratospheric projections – some based on math! – that both coins are only scratching the surface.

Weekend Headline #2 – Altcoin Roulette

Meanwhile, the “Altcoins” – those non-BTC coins that are highly volatile – were also doing some rather odd things in the markets. Take two of the more interesting cases from one of our hypothetical portfolios: Digibyte and Dogecoin.

Here’s a screenshot from our “Hedge Portfolio,” with the three-week growth of those two coins highlighted.

Anyone else think this all looks eerily like the late 90s? Instead of a high-flying Internet stock tip, it’s a high-flying cryptocurrency bet that could go from, in the case of Digibyte, $1,000 to $15,304.77?

The flipside of the late-90s argument is the “how are these used in the wild?” argument. Digibyte went “Segwit” before the other mainstream coins. Doge is called by some “the world’s tip jar.” With real use cases and actual nine-digit market caps for both coins, it’s not that you’re betting on cocktail-napkin business plans.

Signal to Noise

We’ve talked for the past several weeks about things like “fundamentals,” and business plans, and use cases, and white papers. And, the fact that we spent so many years in financial services and fintech marketing and communications means, frankly, that we can see through a lot of the BS that accompanies any launch.

This week, as the industry gathers in NYC for Consensus, we invite you to be on the lookout for BS. For hype. For marketing double-speak – which, it should be no surprise, exists in the blockchain and crypto universe, too.

Honestly, and this is not trading advice and you should of course seek your own counsel, fundamentals are what attracted us to investments such as Bitcoin, Ethereum, Digibyte, and Dogecoin in the first place. Sure, each has its fanboys and fangirls on the various chat boards, but the reality here is that each has the fundamental potential to make serious noise in this emerging industry.

We invite you to do the same: watch for the “check out this COIN, bro!” posts vs. the announcements of actual news from the businesses. See what looks like an engaged, active community online vs. a coin with lots of questions but very few answers.

And as always, stay grounded. Do your research. Don’t dive in with more than you can handle.

Have a Great Week!

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Thing one: Coinbase. It’s the easiest way to get started and, if you want to dip your toes in the water – a distinct advantage of cryptocurrency investment vs. stocks, bonds, or mutual funds – you can buy a little bit. Like $20. Seriously.

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