The short answer is a very definitive no.
Every time Bitcoin goes on a bull run, I get emails from subscribers about my thoughts.
I’ll share them here, but please note that I am not a financial advisor, and this is not financial advice (for informational purposes only).
Last year (July, 2023) I shared this message with you:
“I’m a big believer in Bitcoin. I believe it’s important that we have a currency available that is not influenced by any one nation. Its rules are set in math. There will never be more than 21 million Bitcoin, so the inflation is predicted in advance.
I first learned about Bitcoin in 2016. I bought my first Bitcoin through Coinbase in 2017 at around $2,600. Since then, it’s been as high as $69,000 per coin and as low as $3,000. Even though Bitcoin been around since 2008, it’s still incredibly young and immature, hence the volatility.
…here’s how I see it.
If you can’t get your finances in order, stay away from Bitcoin. That means if you don’t have your retirement accounts set up and don’t have a long-term investing strategy, I would get the basics down first. For example, get out of debt, get a Roth IRA and make sure you have a will.
My theory (at present) is that Bitcoin will have the market capitalization of gold inside 20 years. Gold’s market cap is currently $12.7 Trillion. Bitcoin’s is $593 billion. That means that Bitcoin will have to increase more than 20x from here to reach the market cap of gold. As more and more large institutions buy into Bitcoin, I believe this will happen.”
Let’s fast forward to today.
Bitcoin, as of this writing, is around $101,000, up almost 150 percent for the year.
If you put $10,000 in the Nasdaq 100 (the top technology companies in the U.S.) in 2011, you’d have about $100,000 to show of it. Pretty impressive, right? If you put the same amount in Bitcoin, you’d have well over $100 million dollars. But if you only focus on the current price and what others have made, you’ll be missing the larger point.
My thoughts on the value of Bitcoin have not changed. I still love it because it cannot be influenced by any one person or nation. It’s capped at 21 million supply and there will not be any more made (the last Bitcoin will be mined in 2140). It is the only commodity in the world that is capped. It currently inflates at about 0.8 percent a year and that will dip to 0.4 percent a year starting in 2028.
Any person can own Bitcoin, unlike when some people are denied banking accounts (4.5 percent of Americans are unbanked). Around the world there are 1.4 billion people who are unbanked.
I can send my Bitcoin to anyone, anywhere in the world instantly without the assistance of a middle entity, and with minimal costs (try sending a large amount of money to someone through a bank and see how easy it is).
Now…to my theory that Bitcoin will hit the market cap of gold in 20 years. Gold has been performing well in the last year (up 28 percent) and now has a market cap of almost $18 trillion.
Bitcoin’s current market cap is approximately $2 trillion. If gold stays level, Bitcoin would need to reach $900,000 per coin to reach gold’s market cap. In other words, Bitcoin will need to increase 900 percent or 9x.
Last year I said this would take 20 years. I now believe Bitcoin will reach this level in significantly less time.
Here’s why I believe the timeline will speed up.
The new U.S. administration is bullish on Bitcoin. Their goal is to define clear regulations and create a national Bitcoin reserve. The U.S. currently holds 207,000 Bitcoin (through seizure). Donald Trump has promised not to sell this. States, such as Texas, are planning on purchasing Bitcoin as well.
In the last four years the United States has printed a trillion dollars in additional currency. Every time they turn the money printer on, all the dollars we own become less valuable. Especially with the increasing debt load of the U.S. at over $35 trillion, the additional money printing is unlikely to change. This means that the government is literally stealing your buying power by printing more dollars…at an average of seven percent a year. The inflation of the dollar supply (at historical rates) means that your wealth is cut in half every 12 years if you hold all your wealth in cash. UGH!
More and more companies are adding Bitcoin to their balance sheet. Microstrategy (MSTR), formerly a business software company, has purchased over 400,000 Bitcoin over the past four years (disclosure, I own this company’s stock and posted about the start of this effort in 2020). Companies like Tesla, Block and dozens more have also added Bitcoin to their balance sheet. The idea here is to put their cash (which is losing value) into something like Bitcoin (which is increasing in value). Every day more and more companies are announcing that they are adding Bitcoin to their balance sheets.
I never in my wildest dreams thought that Bitcoin would be accepted as a universal financial asset so quickly. Almost every major financial institution in the world has a cryptocurrency department, and the new SEC chairperson is a huge proponent of Bitcoin.
Unlike the dollar, there is just not enough Bitcoin to go around. We are in the middle of a supply shock. As the US adds to their Bitcoin coffers, so will other countries. And then, so will more companies, and then more individuals.
And finally, it’s portable. You can take it from Cleveland to Tokyo and back on a thumb drive or in your digital wallet. Try that with your Gold or rare paintings. And as for security, Bitcoin has never been hacked and no counterfeit currency has ever entered the network.
It’s truly the easiest long-term asset strategy ever. Buy Bitcoin. Don’t sell. Be patient. Think of it like buying property in Manhattan 100 years ago.
It WILL be very volatile. This is a good thing. It shows that it’s still young and growing, so lots of opportunity left. If this bothers you, don’t look at the price every day.
I believe everyone should put two percent of their assets in Bitcoin. Our family owns a bit more than that. If you are young, a larger portion would be a very good idea.
In Other News
As of this moment, TikTok, the Chinese-owned social media company, will be banned in the United States on January 19, 2025 (the day before Donald Trump takes office). At the same time, Chinese shopping app Temu was the most downloaded App in the United States in 2024. Both, in my opinion, are huge security risks.
As of yesterday, the Supreme Court agreed to hear TikTok’s request to stay active. We will see what happens.
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RFK Jr. and Donald Trump have been talking more and more about vaccines causing autism. Please note that there has never been ANY scientific study that links autism to vaccines. If any of your friends or family bring this up, please set them straight.
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Again this year, author James Patterson doled out $500 holiday bonuses to 600 bookstores around the country. Good story. Better person.
You Should Be Concerned about AI Agents
I’ve been a follower of Tom Lee for quite some time. Tom is the co-founder and managing partner of Fundstrat Global Advisors and I learned about Tom years ago when he started recommending his clients buy Bitcoin as part of their portfolios.
Recently Tom was a guest on the Prof G markets podcast talking about the threat of AI. He says, “In a world of financial markets, where more decisions are made by AI than humans, you’re going to end up with a lot of cheating.”
Specifically, Tom talks about how AI Agents will choose the most likely scenario for success in financial markets, but also in marketing or product sales.
He says, “Spoofing is a high return on investment activity…as a competitive tool, an AI system, when trying to sell a product or build a brand, has one of two decisions to make. Either try to convince people that this is the best product out there [that you have to prove]…or maybe it will decide I’ll just badmouth every other competitor, write fake reviews, bad reviews, claim there are recalls and complaints…that can be done at scale using AI agents.”
That’s a lot. Basically, Tom is saying it’s way easier for someone to compete against you by creating a different reality about you than tell a great story about themselves or their own products.
Like Tom, I’m not sure this will happen, but it is an easier path. Why wouldn’t AI take the strategy that’s far more likely to succeed…create fake content about you and succeed that way? We are up against non-ethical behavior when using AI, because AI agents might conclude it’s easier to cheat.
Human beings with a lack of morals are already doing this.
Enter AI, and this is a thousand times more likely.
This is scary. And it could happen. And we need to prepare for this outcome just in case.
Here are some ideas.
Now, I’m sure there are several things you can do technically that will help, including leveraging some kind of reputation monitoring system, working with a legal team, specifically to plan and prepare for certain scenarios, or even publicly advocate for the responsible use of AI. These are all good things to do.
But I think the biggest opportunity, which you can start right now, is to build a community that trusts you so if anything does happen, or someone or something starts to go after you, you have a community that will help fight your battle for you.
Okay, how do you do this?
First, create an ongoing showcase of customer stories. Use real customer success stories, with names and video, which will be more difficult to duplicate.
Second, educate your customers. If you become indispensable to your customers on some topic, you will build an army of trusted individuals. Pick your home base for this – podcast, email, YouTube, and be THE expert in that content niche to that audience. In this case, the smaller the content niche the better, where you can find an informational content gap. In simple terms, become the voice of authority, the trusted expert, for one or a few content categories over time.
Third, create content that openly explains your processes, your values and how you operate. Maybe some behind the scenes content. Maybe your product development process.
Fourth, develop a subgroup of your audience or customer base that becomes a VIP or membership type community. I can vouch for this working. Our never-ending ticket membership group (as part of our Content Entrepreneur Expo event) is 70 strong and I think we would all do anything to help each other. We meet quarterly and there is a real bond of trust.
And fifth, involve your customers in your educational content. Blog posts, podcast guests, webinar guests…the more you can get customers participating in your content, the more trust you’ll engender with them and your audience.
I’m sure there are more, but this is a great start.
I believe non-ethical behavior by AI agents has a high percentage of happening. To combat this, we need to start now. Those that do will be able to win this battle. Those who don’t…I’ll feel really sorry for.
Wishing each of you a Merry Christmas, Happy Holiday and a Happy New Year!