It was October of 2011. Barely anyone had heard of bitcoin back then.
I had just read about it in the New Yorker. And I wanted to buy some right away.
There was just one exchange that traded bitcoin at the time. It was in Japan, and had this weird name — Mt. Gox.
Its website was hard to navigate. Also, you had to put your bank information in to send it money.
Mt. Gox had already been hacked once. And the deeper I went into Mt. Gox, the shadier it seemed.
Still, I put my bank information in to buy $1,000 worth of bitcoin at $7.
All I had to do was click one more time. Then, I started to imagine my bank account being cleaned out and losing all my money.
I closed the tab, and I never bought any bitcoins.
At its 2017 peak, that $1,000 would have been worth $2.8 million.
Even with bitcoin under $7,000 today, I’d be making about 1,000 times my money.
However, in 2014, Mt. Gox was shut down for fraud. And many people lost millions of dollars in bitcoin.
Shockingly, hacking and fraud continue to haunt cryptocurrency transactions.
However, there’s a crypto innovation with wide application that could stop all kinds of fraud, and perhaps even hacking.
A Secure Digital Record
That innovation is the blockchain.
Now, most of you have read about this thing called blockchain.
A blockchain is a distributed chain of data entries. The thing about blockchain is that everyone can see it. Next, it’s difficult to change.
In simple terms, a blockchain is a secure digital record that has complete information on a transaction or property. It’s like an accounting journal, with every entry that affects a transaction.
A blockchain has massive uses for all kinds of financial transactions.
An obvious use of blockchain is for cryptocurrencies to use it so no one can steal yours.
Blockchain also has huge applications in real estate transactions, specifically ensuring title to property. Using blockchain here will lower costs and reduce fraud, as you would always know who owns the piece of property you are about to buy.
Same thing for assets like stocks, bonds and bank accounts. Using a blockchain for these things will help reduce transaction time and establish ownership, which in turn will reduce costs of buying, selling and owning these assets.
Now, more controversially, blockchain also has huge use in establishing identity.
For example, having a passport on a blockchain will show all the places you’ve traveled, the visas and entry and exit dates. Same thing for voting, where a blockchain can be used to prove that you are eligible to vote.
Blockchains can also be used to reduce fraud and waste for benefits like Social Security.
An Emerging Mega Trend
Bottom line is that blockchain has huge, massive applications across our economy. And there’s no question that it represents an incredible investment opportunity for the companies that work out how to implement it quickly, conveniently and cheaply.
Blockchain is a key part of financial technology, or fintech, which is an emerging mega trend for my Profits Unlimited service.
Now, I’ve been doing research on blockchain for some time now. And in the next two or three months, I’m going to be releasing a major report on one stock that I believe is uniquely positioned to benefit from the blockchain getting widely used across our economy.
In the meantime, if you want to get in on the coming blockchain boom, you can buy into the Global X FinTech ETF (Nasdaq: FINX), which gives you broad exposure to this enormous opportunity.
Editor, Profits Unlimited