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Takeoff Moment for Crypto

Takeoff Moment for Crypto

There’s a war going on. But you’ve seen the news. I’m going to stick to investing.

From that perspective and from a 1,000-foot level, this seems to be a takeoff moment for bitcoin and crypto.

People in Russia can’t get their money out — they’ve been cut off with sanctions. Not approving or disapproving, but it makes you think of the alternative.

Crypto.

Sure enough, bitcoin jumped up past $40K yesterday.

This situation has people thinking about an America 2.0 solution to an America 1.0 problem — whether it be bitcoin, Ethereum, Dogecoin or other cryptos.

Watch here:

 

 

There’s a war on. There’s also a war within a war going on. I have told you that I am going to stick to investing, trading, stocks and leave foreign policy for other folks. There’s a lot of coverage out there and I’m sure you can get those points of view.

I want to talk about some of the stuff that’s less discussed. Let’s get right down to it. Russia invaded Ukraine and since then there’s been this big move by the United States, Europe, Japan and pretty much every country around the world to shut down all the financial pipelines into Russia.

Many people might look at it say, “That’s sanctions.” I’m not talking about approving or disapproving of it. I’m just thinking from the perspective that Russia planned to get through this period by using its international reserves. From everything I have read it says they had $630 billion in a mix of dollars, euro, yen, Chinese currency, gold.

As a result of all the sanctions, for the most part, they can’t use any of it. They can no longer transact on MasterCard and Visa. They can marginally transact using the SWIFT system, which is getting a lot of publicity. For those folks who don’t know, the SWIFT system is something use to transfer money between banks.

It’s also used by businesses and even some number of individuals moving a large amount of money. That has been focused on. However, on a 100 foot level, actually 1,000 foot level, when you look at this, Russia is disconnected from the world. You cannot move money in the way most people can using wires or transfers of any kind.

It does make you look at that and think the folks there who have money are not going to sit still. They are going to do something. That something is going to be to use the other way, which is crypto.

 

How Is Crypto Benefiting From Russia Being Cut Off?

Sure enough, as these sanctions began to hit, the price of Bitcoin (BTC) began to jump.

It went from around $38,000 to $45,000 just like that [snaps fingers]. There’s reports of people standing in line in Russia to get their money out. Certainly for any number of countries, companies, organizations, people, they are looking at what is happening in Russia and thinking, “What if this ever happened to my country? What would I do?”

Russia is a big country, a powerful country. They accumulated a lot of money to try to get through this period when they were at war. Yet, all of that was completely cancelled as a result of sanctions. One of the things that’s going to happen is people, countries and organizations around the world are going to see this.

Good from the perspective that we are doing something against a country that is attacking another one unprovoked, however, I can tell you everyone is going to think, “What if that was us?” Their answer is going to be, “Let’s buy some BTC. Let’s start to look at crypto as a way to immunize ourselves from being subject to this kind of effect if the countries that run the financial systems to decide to cut us off, we can do something.”

I know many people will say that’s terrible, these are criminals. I believe it’s going to be a fairly mainstream thing. I believe countries from as far as Australia, Canada and others are going to say, “We do not control the largely US-dollar-based fiat system and we would like some insurance.”

What if that system got hacked? Maybe that system got caught up in other wars? What are the options? The option is crypto.  I believe people are going to begin to see this as a solution to a problem that exists. They are also going to see it as a trade, a speculation and a long-term investment.

It’s going to be on every level. It’s going to be at the country level, large companies, large organizations, people of varying wealth are going to see crypto as an appropriate place to start to allocate significant amounts of money that act as insurance against any number of possibilities.

Obviously there’s something as dire as what’s happening between Russia and Ukraine, however it can be simpler things such as a number of banks being taken offline as a result of a hacking attack. Perhaps some interregional rivalry that causes someone to shut somebody down.

Crypto offers a way to keep your financial system up, to keep money flowing through. I believe we are going to see in the next days and weeks some surprises as countries start to legitimize crypto, either accepting them as legal tender or passing laws making them specifically legal.

Other countries are indicating they are planning to or looking into buying crypto. Companies doing that as well. Certainly, pressure showing particularly on the most liquid cryptos out there — BTC, Ethereum (ETH), and as preposterous as it sounds, Dogecoin (DOGE).

DOGE is very liquid. It’s widely known. Its price is very low. People’s resistance to using it for everyday transactions is quite low. It has a low threshold. Most governments would feel ridiculous to ban DOGE becomes it seems so innocent and simple.

That also allows for people to buy it quite easily. It could become a currency that is widely used. I know some people say it’s ridiculous, it’s a joke, a meme coin. That’s all true. Nonetheless, if you were to do a poll of regular folks and ask if they know BTC, my guess is a lot of people know it.

My best guess is a lot of people know ETH. I would say a lot of people around the world, especially if they are younger, they know DOGE because of its logo of the dog, the fact Elon Musk is associated with it. That means it has a certain brand power around the world that people are going to use to trust and use as a currency.

Its price is quite low. Your barrier to wanting to use it is quite low, unlike BTC where there are higher barriers. People see this as quite expensive. Bottom line to this, I believe we’re at a moment that is significant for the adoption of crypto.

 

How Could Crypto Save You?

This war, this crisis, is going to bring it out. People can see the existing financial system is highly controlled, non-decentralized and can be brought down and shut down by a number of authorities in a coordinated way so as to shut down an economy and society.

It is in most people’s interest to try to figure out, “What if that was me? What if that happened to us?” The answer is quite clear, it’s crypto. It’s BTC, ETH, DOGE, any number of coins. As long as people are willing to accept it, as long as it’s something that can be easily stored, also something that is easily divisible.

This is the beauty of crypto. It’s easily divisible. It’s portable. People who are leaving Ukraine to go to Western Europe can carry value on a USB stick. Simply keep it in their pocket. Nobody would know you were carrying value or how much. It represents an answer to many questions and problems people are likely to be dealing with at present.

That makes me bullish, optimistic, positive — BOP — on the crypto we have in our Profits Unlimited portfolio. You know we have been in BTC for a long time, ETH for a long time and DOGE since last year.

These have gone through an extraordinary amount of volatility as people have fought over their legitimacy, their use, their adoption, their sensitivity to interest rates and their roles in society. However, Ukraine is acting like an accelerant, just like COVID did in 2020, to illustrate the value of a number of technologies.

Crypto is really, in my opinion, front and center right now with what is going on with the banking system and what is going on with this current war. If you own BTC, ETH, DOGE in our portfolios or if you are subscribed to Crypto Flash Trader, which is run by my incredible colleague Ian Dyer, look out.

I believe we are setting up for a period where you are going to see a lot of money push in. That demand is going to face quite limited supply because of the fact cryptocurrencies, BTC, ETH, really have been sold down. In my judgement, they are now being held by people who believe in it and understand it.

They are not going to sell for cheap prices. It means we are setting up a stage for where fairly small amounts of demand could move it higher, but big demand is going to be a step function jump. I have been out there saying my price targets for BTC for 2022 are $250,000.

However, if a few countries came in and some big companies came in, it’s going to be even higher than that. $300,000, $350,000. Why? It’s just a matter of demand and supply. There’s a limited number of BTC and ETH. If a lot of people come in and want to buy it all at once, they are going to bid it higher.

If they have no plans to sell it and they are planning to keep it as a reserve, as a store of wealth that they will only sell small amounts of, that’s going to keep those prices sustained at high levels. I am very BOP on crypto. I would tell you if you own it, be strong hands.

If you like this video, come back next week and I’ll have another one just like this one. Until then, this is Paul saying bye.

 

Regards,

Paul Mampilly

Paul Mampilly

Editor, Profits Unlimited

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