Dear Friends, In January 2017, bitcoin was trading at the...

Dear Friends,

In January 2017, bitcoin was trading at the equivalent fiat converted price of US$1,000.

Today, bitcoin is trading at a fiat-converted price of $7,500. That’s a 650% gain in around 15 months.

Now if your house increased 650% in value in a year, you’d be doing backflips down the street.

If your stocks were up 650%, you’d be an investing legend amongst your friends.

But if you read the mainstream media, bitcoin is close to death.

If you’re on Twitter, we’re about to head into the ‘crypto winter’. The so-called ‘experts’ on YouTube say the party is over and the race has been run.

If you were new to crypto in November or December and bought during the madness, then yes, everything does suck right now.

But this is also a chance to dollar cost average into your crypto portfolio.

This (in our view) is the only traditional investment theory that applies to crypto.

It works because it makes sense. You can apply it to markets that you’re in for the long haul.

And with crypto, you need to be in for the long haul.

You see, if you consistently go back year after year after year you’ll notice a very interesting pattern. The crypto universe is getting bigger.

It’s becoming more ‘mature’, which is saying something for an industry that’s really only been around for about nine years.

And our opinion is this long pattern of continuous improvement, increasing value and impact on the world, will only get larger.

Yet still, right now the mood is dour. The ‘market’ is down. Maybe the end really is over?

And are we in a bear market? Well…no.

There’s actually no such thing as a bear market in crypto. In fact, the whole idea of a bear and bull market is somewhat of a misnomer.

We’ll delve into the specifics of this in our next podcast — but the core point is that you don’t need to index crypto, because you’re not restricted in what you can or can’t buy.

More on that detail in our next podcast.

Now, we’ve used the term ‘bull’ and ‘bear’ market before, when it comes to stocks and when it comes to crypto.

But the more we look at it, the more we’re convinced there is no such thing as a bull or bear market in crypto. This isn’t stocks. The same rules don’t apply. And neither should the same terms.

We need to develop a new set of terminology for crypto. New ways to describe movements. New economic theories to discuss, create, prove and disprove…

Of course, it’s easy to fall into the trap of comparing crypto to what we know.

For instance, the broader range of crypto moves up and down at the moment. And if it all charges higher, then it’s easy to just say we’re in a bull market.

Like Tuesday for example. A ‘green’ day across the board. But while the bulk of crypto was showing a gain. Not everything was.

And the more this ecosystem grows, the more we’ll see a divergence from a one-in all-in approach to value.

So you can’t really apply the idea of a bull market when there’s disparity between crypto movements. Add in the mix crypto that are scams, fraud or while ambitious, ultimately worthless.

This isn’t a market that behaves like traditional ones.

We’re already starting to see unique behaviours in the crypto markets.

And we’ll start to see individual crypto shift in value based on their own unique developments not just macro factors.

We’ll begin to see when there is a broad downturn, crypto that hit milestones, release upgrades and deliver on promises will also deliver gains.

We’re already seeing (and will see more) crypto move completely independent of others.

Now we’re not saying we’re quite in that stage yet. But we’re getting there. And while the last few months have shown just how hard the crypto markets can burn investors, they can also move equally as hard the other way.

We are not expecting a long, drawn out period of downward value movements.

We’re expecting more wild crazy highs and lows. We’re expecting hardcore volatility, but no bear market.

The reason that traditional market theory doesn’t apply is because we’re also seeing incredibly irrational, outright idiotic trading.

Even the scams survive here

Take for instance bitconnect. It’s a ponzi scheme. Yet it still continues to trade.

People still continue to buy their tokens. It still has a ‘market cap’ of US$5 mln (down form a high of over US$2.8 billion we might add).

Or there’s the recent Centra project. This one infamously used promotion from boxing superstar Floyd Mayweather Junior and DJ Khaled to promote its ICO.

The SEC has now arrested its founders and charged them with fraud over their US$32 mln ICO. Apparently, two of the executives listed on the project weren’t even real people!

There’s more to this story — particularly when the likes of Mayweather and Khaled are whacked with follow up lawsuits for financially promoting fraud.

Still, that’s not really the point here. Fraud has been exposed. The founders arrested. Warnings put out about the project.

Yet, over the last 12 hours the crypto has not fallen in value. We’ve seen over US$42.9 mln in volume for Centra today.

Centra still has a ‘market cap’ of US$6.9 mln.

Let’s be very clear. Centra is worthless. There is no project here.

If you have Centra…good luck to you. If you’re even considering buying some then no one can help you.

Fortunately, we know you’re way smarter than that. But the fact is if this happened in the stock market, there would be a trading halt, suspension from quotation and there would be no market for that stock.

But this is crypto. And even frauds and scams can continue to somehow be ‘worth’ something.

It means that the idea of a bear market, bull market, is simply non-existent, that rational application of logic sometimes doesn’t apply.

When you approach this market, there’s only one principle from traditional markets that applies.

Dollar cost average. Be in this for the long game. And dollar cost average to build your portfolio.

Do that and you’ll set yourself up for all the peaks and troughs and the long-term growth that we think crypto will continue