Bitcoin is worth AU$10,872.97 at the time of writing. When we recommended it to subscribers of Revolutionary Tech Investor, one year ago today, it was AU$1,009.35.
That’s a 977.2% return in exactly 365 days.
Not bad, right? Better than you’ll probably find on any stock market in the world.
However our publisher, Kris Sayce, neatly reminded us of something the other day. He referred back to another published report from Revolutionary Tech Investor, except this one was from August…2013.
Here’s some of what we had to say a little over four years ago,
‘In fact, I see a future in which people no longer use physical coins or bank notes. The future is encryption and digital currencies.’
‘The way I see it is that Bitcoins will serve as a new ‘reserve currency’. In a similar way that US dollars and gold do now.’
‘The move to completely electronic money is inevitable. In fact, my bet is it will happen within 10 years. The last stand for coins and notes is in the realm of small cash payments. But even here technology is hastening the end of physical money.’
When we published that report bitcoin was trading around US$11. In fact on 16 August 2013 bitcoin hit a high of US$13.50. A few days later on 19 August it was at a low of US$8. That’s a 40.7% fall in three days. It didn’t come back to US$13.50 until late December that year.
Ah, the good old days…
Had we had the metal to tip bitcoin in a stock publication back then, we would be now sitting on roughly a 74,627% gain. And remember that’s just four years ago.
You don’t get over those opportunities easily.
Nonetheless, here we are today. And bitcoin is now clear of US$8,220 — well over AU$10,000. It’s a global phenomenon. It’s the most controversial investment instrument, perhaps ever.
But what a lot of people miss is that there’s more to come. Oh boy, there’s plenty more to come.
Guilty as charged
One of the difficulties with bitcoin or other crypto is ‘price’. We constantly see the price of these in fiat money. And yes, we can admit that we clearly do it too — as you see above. Guilty as charged, your Honour.
The reason we do it is to show you the potential of these crypto. That is, by converting bitcoin into a fiat price you can see the growth in its value from one point to another.
It’s the perfect comparison tool. But if you were to get technical about it all, the truth is one bitcoin in 2013 is exactly one bitcoin in 2017. And in the year 2140, one bitcoin will be exactly one bitcoin.
Note: We say 2140 because that’s roughly when all bitcoin is projected to be mined and in circulation.
Now you might think, of course one bitcoin is exactly one bitcoin today, tomorrow and into the future. But can you say that about your fiat money?
No, you can’t.
What you could buy with one Aussie dollar in 2013 would now cost you $1.05. That’s a figure taken from the Reserve bank of Australia.
That’s a 4.76% decrease in the purchasing power of your dollar in just four years. Hence one dollar today is not worth one dollar tomorrow. And by 2140 — well it’ll be worth a lot less then, too.
But will bitcoin? Well, we don’t know. We do know it’s volatile. We have seen wild ‘price’ swings in the past. We’ll probably see more volatility in the future. But in our view, the value of what your bitcoin will be worth by then is hugely different than what it is today.
And importantly, it’s not too late to get in on the action. And not just bitcoin. But a whole range of different and exciting cryptocurrencies that could also skyrocket in value.
We’re about 1/6th of the way there
On the 12 October 2016 we wrote in Money Morning:
‘When the world is on the brink of financial collapse, it’s not gold, not currency, not even stocks that really flys. It’s bitcoin. If the system shuts down, if there is financial calamity, bitcoin could soar — and even repeat the incredible gains from 2013.
‘If the world finds itself in another ‘2013’, bitcoin could soar from US$639 now to $49,618, another 7,765% return. I wouldn’t be surprised to see it top US$50,000 for just one single bitcoin.’
And we think that day of US$50,000 is fast approaching. We see that right now bitcoin is still in a ‘price discovery’ phase. And this is all happening as the wider world switches on to the opportunity.
We still haven’t reached a tipping point of mass adoption. We still don’t have more merchants accepting it than not. We still don’t have large investment money flowing into it.
We still haven’t seen another ‘2013’ style edge of collapse in the financial system.
There are a lot of trigger points coming up for bitcoin. And that’s just external trigger points.
There are also the continuous development in Bitcoin and even it’s offshoot, Bitcoin Cash. One may reign supreme long term…or both might. We don’t know. What we do know is that both have benefits and disadvantages, for now.
But we think the open source development of both could lead to huge upside in the future. And still, with most people sat on the sidelines, the opportunity exists to get in even at these levels.
That’s right, we still think bitcoin is early stage. We know those getting in now are still miles ahead of the mainstream and the average punter on the street.
Don’t get put off by the talk of bubbles. Don’t get caught up in the skyrocketing ‘price’. Understand that there’s more coming for bitcoin. And everything it stands against — centralised power, the broken financial system, monetary policy manipulation — only serves to make it stronger.
Editor, Australian Small-Cap Investigator