Down the Bitcoin Rabbit Hole
Chapter 10: Gradually, Then All at Once?
I noticed that a lot of the titles of notes that I write end in a question mark.
So I am asking again today after learning that Visa (yes, that Visa) announced it plans to help banks roll out bitcoin and cryptocurrency buying and trading services with a Visa crypto software program, set to launch later this year. This seems like a big deal to me.
"Our strategy here is to work with wallets and exchanges to enable users to purchase these currencies using their Visa credentials or to cash out onto our Visa credential to make a fiat purchase at any of the 70 million merchants where Visa is accepted globally,"
Why is this a big deal? First, Visa was anti-bitcoin / crypto in the beginning but they have changed their mind. I have written in the past that I am always more interested when someone changes their view than when someone has maintained the same view despite evidence that the facts have changed.
Now, I think bitcoin is at the accumulation stage. I don’t want to use any of what I have to buy anything but the fact that Visa has entered the story may give us a clue where this could ultimately be heading. They are a payments platform after all.
Next up is the CME, the Chicago Mercantile Exchange. Their chief economist recently made the comment that bitcoin is an “emerging competitor” to gold. That’s a big deal as well, especially when we look at the inflation theme that I have been pounding the table on since the summer. With inflation picking up, gold should be moving higher but it isn’t.
I actually think that gold will work. I don’t own any because the dynamics that make gold work (inflation) should make bitcoin work better. So as Paul Tudor Jones said: “The best profit-maximizing strategy is to own the fastest horse,” Jones, the founder and chief executive officer of Tudor Investment Corp., said in a market outlook note he entitled ‘The Great Monetary Inflation.’ “If I am forced to forecast, my bet is it will be Bitcoin.”
I want to be mindful of what I own and the degree to which they move together. If I am wrong on the inflation call, I don’t want to own two assets that are both going to fall for the same reason.
As for bitcoin, it continues to consolidate after after the strong move that took it through the 2017 highs. That’s fine with me, it gives me a chance to buy more while it stalls here.
By the way, is seems that Elon is warming to bitcoin. Also, Clubhouse is pretty interesting.
*As a reminder, nothing in these pages should be considered investment advice. This is a diary of my thoughts as I think about how I want to be invested within my own personal account.
For a more in-depth look at how I view markets, you can find out how to see my daily notes here: