Jean Galea

Health, Wealth & Happiness

Where To Buy NFTs – The Biggest and Trusted Marketplaces

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nft marketplaces

A question that most beginners in the NFT world face is this: where to buy NFTs from? The answer in most cases is: through an NFT marketplace. There are nuances, so we’ll be going through the landscape briefly and trying to make sense of things.

In this article, I’ll be dividing NFT marketplaces into two: Open and Curated.

I will also mention some tools that can be used to trade NFTs securely in a peer-to-peer fashion.

Open Marketplaces

An open marketplace is one where anyone can mint and sell NFTs. There is no need to apply and get accepted – creators just connect to a wallet and mint the NFTs. Existing owners of NFTs can list their NFTs for resale.

OpenSea

OpenSea is easily the largest NFT marketplace. When you see people talking about buying and selling NFTs, 99% of the time they are referring to doing this on OpenSea. The platform has seen trading volume skyrocket into millions of dollars during 2021.

By being an open marketplace, scams abound, so you need to be careful to get the right URL for a project, as there are usually copycats posing as the real project and trying to trick users into buying them. OpenSea verifies the largest projects and adds a checkmark next to their name. Look out for that, although some projects are having to wait days to get the checkmark, so not having a checkmark doesn’t mean the project is not trustworthy either.

Some alternatives to OpenSea are LooksRare, X2Y2 and Blur. All these marketplaces can be used to trade NFTs on the Ethereum blockchain.

Objkt

Objkt is the equivalent of OpenSea on the Tezos blockchain. If you’re new to OpenSea, it’s probably a better idea to stick to buying NFTs on the Ethereum chain, but if you’re into generative art, it’s worth having a look at what’s available on Tezos. Typically art on this chain is much cheaper. For generative art on Tezos it’s also worth looking at FX Hash.

Rarible

Rarible is another open marketplace, however, unlike OpenSea, it is more focused on art assets such as books, music, albums, digital art, movies, photography, games, metaverses, domains, and memes.

Rarible integrates with OpenSea – minting on Rarible can populate the NFTs on OpenSea. Users can view the collectibles they created on Rarible on OpenSea and manage the NFTs on OpenSea as well. However, unlike OpenSea, Rarible only lists NFTs that were minted on Rarible.

If you’re looking for a higher risk/higher reward investment, look into the RARI token, which you can buy on Kraken.

Buy $RARI on Kraken

RARI has a total supply of 25m and is considered to be a utility token. By owning RARI tokens, users gain the ability to submit and vote on proposals to change its rules. This includes voting on possible fee changes, how those fees are spent and the rules governing creator promotion.

It is important to note that voting with RARI is non-binding, and that the Rarible company still needs to accept user decisions and implement them. However, Rarible’s goal is to eventually transfer power to a software-based system controlled by users called the Rarible DAO.

The idea behind buying the RARI token is to gain exposure to the growing NFT and digital content market or to have a say in how one of the leading NFT marketplaces develops.

Curated Marketplaces

A curated marketplace determines which NFTs are allowed to be minted, posted and sold on it.

Compared to an open marketplace, a curated marketplace is more limited and exclusive, requiring artists to apply and be accepted before being able to mint or sell NFTs in an attempt to keep fraud down and quality high.

SuperRare

SuperRare’s marketplace focuses on a limited number of hand-picked artists. Though aspiring creators can submit an artist profile form, entry barriers are high. Artists must submit their work for approval before it can be minted and listed on SuperRare’s marketplace.

Foundation

Foundation’s marketplace is community-led, so artists invite new artists to join the platform and mint their NFTs. Creators can access the “creator invites” feature after selling their first NFT. Foundation also has OpenSea integration, so by minting on Foundation, the NFT can automatically be displayed on OpenSea.

KnownOrigin

KnownOrigin focuses on digital art. It is more difficult for creators to get accepted onto its platform. Artists submit their artwork in .jpeg or .gif format to the KnownOrigin gallery. As of April 2nd, 2021, applications are closed to creators.

Nifty Gateway

Nifty Gateway offers crypto assets and art called Nifties. Nifty Gateway partners with top creators, brands, athletes and artists, so it is difficult to get accepted for crypto art – only famous artists, brands, and celebrity creators will be selected to use the platform. Collectors can even buy items for sale on OpenSea using Nifty Gateway and pay using a credit card.

MakersPlace

MakersPlace also offers digital art. MakersPlace is invite-only, so an invited artist will fill out the creator application and sign and mint its NFT.

P2P Trading

You can also exchange NFTs in a P2P fashion on the following platforms:

This is useful if you strike a deal with someone who is willing to buy/sell within a project’s Discord channel. This happens a lot and is a great way to find good deals.

Is Trading Crypto in Portugal Tax-Free?

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The main reason for the enthusiasm about Portugal from people involved in the crypto space is that until 2022, crypto earnings are tax-free in Portugal.

The current proposal for the 2023 budget includes an amendment that will ensure crypto trading gains will be taxed at 28%. However, crypto held for more than one year will not be taxed on disposal, which still means that Portugal is one of the best places to live in for crypto and NFT investors. The NHR program is also still firmly in place and can result in very attractive low to zero tax rates if the right structure is implemented.

Here’s the information on the pre-2023 situation which led to crypto gains for Portuguese residents being tax-free:

In a 2016 official ruling, the Portuguese Tax Authority analyzed the possible classification of cryptocurrencies within certain types of income that are subject to Portuguese tax, notably capital gains, capital income and income from business activities, and decided that, as a general rule, natural persons should not be taxed in respect of gains derived from the valuation or sale of cryptocurrencies, except that, in the case of sale of cryptocurrencies, if they correspond to the individual’s main recurrent activity, income obtained from such activity could be subject to Portuguese tax.  It should also be noted that this was only a partial decision that did not elaborate on other types of income derived from other cryptocurrency-related activities (e.g. mining and farming activities).

Have a look at the 2016 binding information as it’s the most relevant document for crypto investors. The linked document is in Portuguese, but it consists of the Portuguese tax authority’s reply to a direct question about crypto taxation.

I’ll provide a basic interpretation (in my own words, not a word-for-word translation) for those of you who don’t understand Portuguese:

Cryptocurrencies or virtual currencies are not technically considered money due to not having legal tender in Portugal. However, they can be exchanged, with a resulting profit, for real currencies (euros, dollars, or other) at exchanges, with the prices being determined by the demand for said cryptocurrency.

Thus, cryptocurrencies can generate different types of taxable income:

  1. Gains obtained from the purchase and sale of virtual currency units/exchange from the cryptocurrency to real currency (whatever it may be)
  2. For obtaining commissions for the provision of services related to obtaining cryptocurrency.
  3. For gains derived from sales of products or services in cryptocurrency

This document only considers the first scenario. This is the scenario faced by most crypto investors.

The profits from this activity are candidates for three categories of income types:

  1. Capital Gains – category G (e.g. sale of an apartment, sale of shares)
  2. Capital Yields – category E (e.g. rent of an apartment, dividends)
  3. Professional Income – category B (e.g. consultancy, freelance work)

Category G

Article 10 of the IRS Code specifies the cases that are taxable as capital gains. The key thing to note here is that when the legislator created this law, they resorted to a closed type, meaning that the law is specifically for the items mentioned and nothing else. Since cryptocurrencies do not fall within the specific cases mentioned, and their value is merely determined by supply and demand, therefore we can conclude that they are not taxable within this category.

Category E

This category clearly does not apply to the sale of crypto assets since it relates to yields on capital e.g. dividends, rental income. On the other hand, I would note that the income derived from services such as YouHodler and other crypto interest accounts would probably fall in this category. The same goes for income from crypto staking e.g. Ethereum staking.

Category B

Here’s the tricky one. Category B relates to the income of a self-employed worker. When a type of income can be classified as of category B or any of the other two categories considered here, category B would prevail. So in this category income can be taxed whether it comes from sales, whether it is capital income, or any other nature, pursuant to paragraph 1 of article 3 of the IRS Code.

To determine whether the income falls into this category, one would need to consider its frequency and the orientation of the activity towards obtaining profits. If the existence of the exercise of a business or professional activity is verified, then the taxpayer is obliged to comply with the declarative obligations contained in paragraph 6 of article 3 of the Code of IRS, i.e. to issue an invoice or equivalent document (electronic invoice-receipt), whenever you sell some product or provide a service.

The reason I say that it’s a tricky one is that crypto traders need to consider carefully whether their activities would be considered professional income or not. Here I would suggest that if you’re in doubt you should consult a tax lawyer. The general rule worldwide is that if trading is your main source of income and you are opening and closing positions on a daily basis you would most likely classify as a professional trader and your income will fall in this category – therefore not being tax-free.

The conclusion of the document states clearly that the sale of cryptocurrencies is not taxable in Portugal unless due to its frequency it constitutes a professional or entrepreneurial activity, which would make it taxable under category B.

This latter point also results in a lot of questions about whether or not one would be classified as a professional trader.

There are several factors that determine whether one’s trading activity is professional or not. These include:

  • Number of trades per day/week/month/year.
  • Holding period of financial products
  • Complexity of traded financial products
  • Number of trading platforms used
  • Debt-to-equity ratio, credit financing
  • Profit level and relationship to other income
  • Additional relevant trading activities (such as advice)
  • Traders’ main activity (where else do you get your money from?)

The fact that one of the factors listed above applies to you does not automatically make you a professional trader. Ultimately one must look at every individual’s overall situation, and this can only be reliably done by involving a tax lawyer who will give you a written opinion.

In summary, cryptocurrencies in Portugal are only taxable if you do it as a professional trading activity and therefore you need to open an activity as a trader and pay taxes according to your profit, otherwise they are considered non-taxable in Portugal due being unable to fit in any category.

Note that the above is true for individuals but not for corporate entities. If you hold your crypto in a Portuguese company, all the gains from cryptocurrency trading are taxed together with any other profit the company had, irrespective of whether the company is engaged in trading or whether it held the crypto as a long-term investment.

Contact me if you need to speak to a tax lawyer who knows how to deal with crypto. It’s very important that you assess your individual case before making any decisions.

One should also keep in mind that the NHR program is really the main attraction for moving to Portugal from a tax perspective. In my article on European tax strategies I highlight some examples of how one might lower their overall level of tax liability by implementing structures spanning multiple countries.

The Best Community NFTs

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art blocks community

One of the best use cases for NFTs is for token-gated communities.

In this post, I’ll share my favorite community NFTs, meaning that these online communities use NFTs as a means of authenticating users to their Discord, assign allow lists, giveaways, real-life meetups etc.

I’ve taken a lot of inspiration from my experience in these communities when I decided to start my own online community.

PROOF Collective

PROOF Collective is a private, members-only collective of 1,000 dedicated NFT collectors and artists. It is a project by Kevin Rose (the founder of Digg), and that alone is a good reason to join, given Kevin’s trajectory in the web space starting from the early 2000s and moving on into Web3 these days. He has an enviable collection of OG NFTs and runs a podcast where he interviews top generative artists – he definitely knows his stuff.

I found the community to be very diverse, extremely helpful and very knowledgeable, especially about the generative art side of NFTs. I feel that generative art is an area that interests me a lot, but I am not yet able to value projects as well as I can in the PFP niche. This makes being in PROOF and being able to even talk to some great artists a big plus for me.

This is just a unique club in the NFT space, and the quality of everything they do is off the charts. To cite an example, have a look at the GRAILS drop and all the work that went into that. They’ve given a ton of value to their holders in subsequent drops like Moonbirds and Oddities as well. If it’s a great community that pays ETH dividends that you’re looking for, PROOF is your number one choice.

Website | Twitter | OS

gmDAO

The gmDAO is a community of NFT collectors, artists & investors created in September 2021 using a fair token distribution. Broadly speaking, the DAO was formed based on the principles of etiquette and mutual respect, making the community a haven within a typically hostile environment. This ultimately resulted in an extremely passionate & engaged member base.

Structurally the DAO consists of 900 members, the majority active within NFT sector, with backgrounds ranging from accredited investors, to renowned generative artists with collections featured on ArtBlocks curated.

The primary goal of gmDAO is to foster & encourage the development of the NFT space, whether through organic marketing, seed funding from the treasury or development from within the DAO itself. The DAO also seeks to provide an edge to members through information not freely available to the market. Lastly, the gmDAO will launch a number of internally managed projects that will act as a revenue source for the community.

The first project was gm.Studio, through which the wildly successful generative project Factura was launched in 2022.

The gm.studio is a generative art platform that claims to be the world’s first completely decentralized art platform. It is a direct challenger to Art Blocks and addresses the downsides that platform presents to new artists, namely extremely long application times, poor communication and financial barriers to entry.

The two main methods that these improvements are brought about are:

  1. A blind curation process
  2. Artists pay no fees upfront (the studio handles marketing, deployment & rendering costs)

In this way, every artist starts on the same footing, and the curators/judges have no idea who is the artist behind the project they’re looking at. While this sometimes results in famous artists being rejected, it does ensure a more inclusive and fair process.

Twitter

Grailers DAO

GrailersDAO is a community focused on supporting and collecting high-end “grail” art NFTs (with a particular affinity for generative art and Art Blocks.

Owning a GrailersDAO NFT does not, however, come with fractional ownership of the GrailersDAO NFT grail art collection. Each GrailersDAO NFT provides you with one governance vote over what the DAO does with its treasury. Currently, the treasury is composed of ETH, artworks, and some additional GrailersDAO NFTs.

Owning a GrailersDAO NFT enables you to verify as a holder on Discord which, in turn, provides you access to all members-only channels. The DAO is also working on additional perks for holders, including working directly with artists to produce artworks

GrailersDAO members include some of the world’s leading generative artists, some of the world’s top digital art collectors, expert Web3 builders, generative art lovers, and many others.

Each GrailersDAO NFT is a piece of generative art by Art Blocks Curated artist Stefano Contiero.

The floor price on this has stayed pretty constant, and I’ve enjoyed the conversations with artists and other collectors in this Discord.

GrailersDAO on OpenSea

Collective Strangers

collective strangers

Collective Strangers is a community focused on photography. It is both for those who are photographers or want to take up photography, and for those interested in collecting photography NFTs.

It’s a friendly community with its own PFP project as well, and the founder, Eric Rubens, is a well-known photographer who I had the pleasure of interviewing on my podcast.

Collective Strangers website

Bored Breakfast Club

Bored Breakfast Club is at the forefront of a revolutionary business model combining the benefits of blockchain technology with an NFT community to unlock both digital and IRL utility on a consistent basis.

The Bored Breakfast Club consists of 5,000 unique breakfast scenes, living as NFTs on the Ethereum blockchain. This is more of a fun experiment than a very serious investment, although it’s already been profitable for me. I like it because it’s an innovative idea that consists in delivering free monthly coffee to holders of the NFTs. In essence, Bored Breakfast Club is the first Web3 Coffee Subscription service.

The money to pay for that coffee is generated through the initial sale, secondary sales as well as merch. The founders have always been transparent from the start in saying that this is an experiment that might have to be wrapped up at some point if the flow of funds dries up, but so far they have delivered. I like the fact that it’s essentially a community of coffee lovers that I’m very happy to be part of and share my passion for coffee in. The idea of them being banners that could accompany bored apes, one of the biggest collections in the NFT space, is also good. I haven’t really seen any bored ape owners use these banners, but then again banners have not really taken off yet.

Several of my friends are owners of these tokens, and it’s been fun sharing our experiences with the coffee, as well as teasing each other about the delays of receiving them due to the customs bureaucracies and postage inefficiencies in each European country we are based in (the coffee is sent from LA, and postage is thankfully included, so we only have to pay customs duty).

As I mentioned, the funds to keep this project running come from the Community Coffee Wallet. This is an aggregated fund with the sole purpose of supporting free coffee reward shipments worldwide for Bored Breakfast Club NFT holders. The wallet is funded by royalties from secondary market sales, as well as a percentage of profits from other mechanisms, including Reserve Roast sales, Blends with Friends releases, merchandise, and more. Once the wallet reaches a threshold that allows the company behind Bored Breakfast to share a new blend with the Bored Breakfast Club members, they drop a new blend and ship it out for free around the world.

The Community Coffee Wallet funds go toward paying for everything that goes into reward shipments – custom packaging, sourcing the highest quality beans, expert roasting, fulfillment, and of course, free shipping worldwide.

While the first two reward shipments were funded via the project’s mint, all future reward shipments will be funded by the Community Coffee Wallet.

Based on the volume of secondary sales transacted to date, and the incremental funding mechanisms developed since mint, the founders are confident that the Community Coffee Wallet will be a sustainable fund to help fuel free coffee via reward shipments for the foreseeable future. I’ll definitely be enjoying it till it lasts, but am not counting on that being very long.

Website | Discord | Twitter | OS

Curious Addys Trading Club

curious addys

Curious Addys Trading Club was the first educational NFT project with a 100% refund baked into the smart contract.

The focus of this project is on building an educational platform for newcomers to crypto.

People who are deeply involved in crypto compare the current state of things to the internet in ’95, when only technical people were on the web building stuff and understanding what this new technology could do in the very near future.

What is working today in getting regular people involved in crypto is NFTs and games. People spend thousands of hours playing games that require learning completely arbitrary complex skillsets only useful inside the games themselves. The Curious Addys’ team identified Duolingo, an app I use myself to learn languages, as the model to use in order to spread the love and knowledge for crypto. So the idea here is to build the Duolingo for crypto.

However, Duolingo is the Web2 model of making an educational game. curious NFTs are just the Curious Addys’ trojan horse to get everyone behind a much bigger vision: creating the killer app to make crypto go mainstream.

The mint price was set at 0.08 ETH.

There’s a curious story behind the octopus (watch this documentary to learn more about this fascinating creature) and the name Addy as well. Addy is a curious ADHD octopus crypto companion, filled with boundless energy and hyperactive enthusiasm for learning each and every little thing about crypto. Smart, curious, and all over the place with eight hands to do eight things at once, the founders felt an octopus best embodied the essence of being a bold, brave new pioneer on the crypto frontier.

Mai and Ben, the developers behind this project, are both ADHD, and a large proportion of their friends in crypto are similarly ADHD – crypto is the perfect playground for an ADHD soul, with a million shiny infinitely interesting things to play with and what feels like thousands of things coming out every day. I can kind of identify with that. Contrary to popular stigma, ADHD has been profoundly beneficial for the founders, so they decided to incorporate a tribute into the name of this project.

The message of the founders really resonates with me. I feel that crypto is the biggest technological and financial opportunity of this generation, however, I struggle to get the people I love to be involved and thus benefit from all the good things that crypto brings, because there are several barriers to entry still.

Moreover, in a sea of get-rich-quick schemes and kids with too much money on their hands, this is a project that really shines by doing things differently and feels wholesome, and this is the main reason why I’m 100% in. I might not make any money on this one, but I love being able to be part of this initiative.

Website | Discord | Twitter | OS | Dune

Did I miss out on your favorite NFT community? Let me know in the comments below!

Should You Buy Bitcoin Right Now? – An Expert Opinion

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Kraken

Buy Bitcoin on Kraken 

As Bitcoin goes through its ups and downs over the years, the question on everyone’s mind is whether this is the right time to buy.

“Hey Jean, do you think this is a good time to buy myself some Bitcoin?”

My inbox has been flooded with slight variations of this question, so I wrote this article to help my friends, family, and the general public process this decision and arrive at an informed decision.

I am a strong believer in the long-term future of Bitcoin due to its fundamental properties, which we’ll delve into later in this article. I have therefore been happy to buy at any price point since Bitcoin’s inception, as I think the price has a long way to go still and we’re in the early years of crypto, comparable to watching the dawn of commercial internet usage in the mid to late 90s.

I consider Bitcoin to be the best investment of our lifetime and will do my best to explain why I think so in the rest of this article.

How to Get Started with Bitcoin

I know you might now have time or even sufficient interest to read the rest of this long article, so again, if you’re already convinced about buying, here are my basic recommendations for entering the Bitcoin space.

In the meantime, if you’re already convinced and you came here looking for the best places to buy Bitcoin right away, here’s what you need to do next:

  1. Sign up at the leading crypto exchange Kraken
  2. Transfer money (EUR, USD etc) from your bank to the exchange.
  3. Buy Bitcoin
  4. Start thinking about how you prefer to custody your Bitcoin.

There are hundreds of places you can buy Bitcoin from, but I would suggest that you stick to the exchanges that have been established for many years and have a perfect security track record. It’s important that these exchanges are regulated where applicable. These are my recommendations:

They are the world’s safest, biggest and most reputable exchanges and you can’t go wrong with them.

I’ve also written a guide on how to buy Bitcoin in Europe where I go into further detail on how you can get your hands on some Bitcoin.

Once you have your Bitcoin, you can purchase a Ledger Nano to store that Bitcoin offline and away from any hackers.

Trade Bitcoin on Binance

If you’re more inclined to trading, you can check out platforms like eToro or Bitfinex.

If you just want to hold your Bitcoin while earning good returns, you can check out some crypto platforms that offer a savings account. My favorites at the moment are YouHodler, Nexo and Coinloan, but you can learn more about those options here.

Towards the end of the article, I will again discuss some of the ways that you can make money with Bitcoin.

Waiting to Buy the Dip

By far the most frequent follow-up question I get and the biggest block I see people facing, is this:

“What price should I buy at?”

I don’t believe in timing the market on any investment, unless there is a big macro event like the financial crisis of 2007-2008 and the COVID dip of March 2020.

Therefore, for any investment I make, I’m typically looking 5-10 years ahead and thinking about how much value that investment can generate within that timeframe. The whole crypto space is still in its infancy, and Bitcoin has enormous room for growth, thus any price point is a good entry in my opinion.

I think we’ll be seeing many more similar tweets in the coming months and years:

Unfortunately, people are really attracted to the idea of buying the dip. The problem is that the dip may never come, and if you know people who did buy some dip, it’s likely that they were in a position to buy at an even lower price a few months earlier but didn’t have the courage to pull the trigger. If that’s not the case, in 90% of the cases I would attribute managing to buy a dip to pure luck.

Even in the case of the major macro events like the 2007 crisis and March 2020 dip, to make the most of those events you’d have had to have a lot of spare cash lying around and ready to be invested. Again, mostly, a question of luck.

See also: The Best crypto trading apps and exchanges

However, if you feel uncomfortable about choosing a particular price point to make your entry, consider investing a fixed amount periodically, say every month. In that way, you’ll smooth out any drastic price variances and you’ll be building up your Bitcoin portfolio over time. The disadvantage of that strategy is that Bitcoin might make a sharp move upwards in the meantime.

Ok, with those preliminary recommendations out of the way, let’s proceed with the reasons why I think Bitcoin is the best investment of our generation.

Why am I Bullish on Bitcoin?

In 2020, as a response to the COVID fears, Bitcoin dipped heavily in March and I had thought it was a great time to increase one’s Bitcoin holding, as the market was ruled by fear.

Since then, the price has risen steadily, breaking through its former all-time high in a dramatic way. As always, since we are still early, there are wild swings up and down, and that’s to be expected for an emergent asset class.

Before we continue, let me reiterate that nobody can predict Bitcoin’s price, and neither can I. Even if I had some hunch, I would not want you to blindly follow what I say, because I am against getting financial advice online.

However, I use this blog as my own small space to think about things, and writing is how I best formulate my ideas. As an added benefit, I get to interact with other investors and people whose ideas contrast mine, thus helping me further refine my thoughts.

The way I see it, Bitcoin seems to be following the stock-to-flow model when we view its price over the long term. Proponents of this model had predicted that the price of Bitcoin should reach somewhere between $100k and $200k at some point in the next few years. This is based on an analysis of the demand and scarcity of this asset, and comparing it to other assets like gold.

Read more: The Best Books about Bitcoin and Crypto

This is a very bullish target price, although it does seem realistic given Bitcoin’s ATH. Irrespective of the price swings, I remain very bullish on the Bitcoin network long-term, due to the fundamentals being stronger than ever.

Let’s now consider a few major themes that add to the bullish argument for Bitcoin.

Bitcoin’s track record VS the S&P500

Bitcoin has been the best investment asset within the past 10 years by a long stretch. Take a look at how it outperformed the S&P500 index during the past few years:

Bitcoin vs SP500

However, even with such a historical track record in place, I would suggest looking beyond the charts. The basis for my investment is a philosophical one based on my belief that Bitcoin solves a need as a totally independent store of value that is not at the mercy of any government or company. I am happy to invest some of my net worth in cryptos for this reason, and I know that I’ll be happy about my decision in the future whether prices rise or fall, as it is based on that reasoning and not just speculation.

Bitcoin as a Safe Haven

The US federal reserve printed ungodly amounts of dollars in 2020 and then pumped into traditional financial markets last year to keep them from faltering. The European Union followed suit. It’s quite logical that with more money in the system, the value of your existing stash will lose value as money is less scarce than it was before. Bitcoin on the other hand maintains its hard cap on the total amount that can ever be issued.

Hence we get a chart like this, where fiat currencies unequivocally lose value against hard assets like Bitcoin.

fiat vs bitcoin

Big institutions and corporate entities have understood this very well. In fact, their main play is that of protecting their financial reserves, rather than buying Bitcoin in the hope of exponential growth. They want to protect the store of value they have accumulated over the years, and they know that if they don’t buy a hard asset like Bitcoin that value will be greatly diminished by the effects of money printing and other fiscal policies.

The Great Upcoming Wealth Transfer

Kraken Intelligence, the in-house research team at the crypto exchange of the same name, released a new report entitled “Inheriting USDs & Acquiring BTCs: How ‘The Great Wealth Transfer’ Will Fuel ‘The Great Bitcoin Adoption.’”

According to the report, if American Millennials were to invest at least five percent of their inherited wealth into Bitcoin (BTC), they could drive the price up to $350,000 in 2044. This would effectively give the generational group almost $70 trillion of value from a $971 billion investment.

With many older Americans on the verge of retirement, the report suggests those in younger generations who are not only more familiar with but more accepting of Bitcoin will have more options investing in the future.

“…a disproportionate percentage of the Millennials and Gen X will continue to be the driving force of adoption [of cryptocurrency] for the foreseeable future. While this can be explained in part by the fact that both generations harness a greater technological competence than their elders, we should also consider that bitcoin’s current volatility is unsuitable for individuals nearing or in retirement.”

Baby Boomers in the United States currently control approximately 57% of the total wealth, $50 trillion of which will pass to Millennials and Gen Xers in the next two years. This redistribution is referred to as the “Great Wealth Transfer”.

If younger people were to use just 1% of this wealth to then invest in BTC, the price could rise to $70,000 — if not more — in 2044. This is based only on investors in the U.S., meaning the actual numbers could easily be higher.

Bitcoin entering the Fourth Era

According to an analysis by Bitwise Asset Management, Bitcoin is entering its fourth era in which it will go mainstream, and if previous eras are anything to go by, we should be seeing a big run-up to $100,000 or more in the next 2 years.

New Crypto-First Banks

Less than two months after cryptocurrency exchange Kraken secured its Wyoming bank charter to start a crypto bank, a second player did the same.

Custodia bank is another bank that specialises in crypto.

These are very bullish developments for the crypto space in general, as banking has long been a major Achilles heel for crypto investors and businesses. Many of the world’s banks were and still are hesitant about providing services to crypto-related companies, and some even prohibit normal people from transferring fiat currency to exchange accounts or withdrawing them back from exchanges to the banks.

These new banks, and others that are pivoting or changing their previous stance, will now change the scenario and make crypto investing much more accessible, paving the way for many new investors to enter and get their first holdings.

Click here to check out some forward-thinking European banks that are crypto-friendly.

Not only are we seeing new crypto-friendly banks popping up, but even traditional banks are getting in:

  • BNY Mellon, America’s oldest bank, announced its plans for a digital asset custody offering later in 2021. Mike Demissie, head of advanced solutions at BNY Mellon, called custody services the “anchor” of the industry.

  • A $150 billion investment group at Morgan Stanley is considering whether bitcoin is a “suitable option for its investors,” per a Bloomberg report. The investment would require regulatory approval.

  • Deutsche Bank also has plans for cryptocurrency custody and prime brokerage offerings. According to a previously overlooked report from late 2020, the bank is set to develop “a fully integrated custody platform for institutional clients and their digital assets” to connect with “the broader cryptocurrency ecosystem.”

  • JPMorgan co-president Daniel Pinto said his bank “will have to be involved” in bitcoin if it develops into an asset used by different managers and investors. “The demand isn’t there yet, but I’m sure it will be at some point,” Pinto said.

European countries legalizing Bitcoin

As reported by Les Echos, Bitcoin now has the official status of money in France.

Meanwhile, Bitcoin has been qualified as a financial instrument in Germany. Portugal, on the other hand, is well-known as possibly the most crypto-friendly nation in Europe, and does not impose any taxes on crypto gains.

Bitcoin is the result of many previous projects and research

Many people seem to think that Bitcoin is a recent thing, even a bubble, but it can’t be further from the truth. Bitcoin has already been working for more than ten years, while being itself just the latest in a series of projects that tried to achieve the aim of a censorship-resistant and digital money and store of value.

Here’s a chart illustrating how far the Bitcoin prehistory goes:

The Biggest Hurdles that Bitcoin Faces

bitcoin problems

While I firmly believe that Bitcoin is here to stay and that we will see a massive increase in price over the coming years, there are still some big and important hurdles for this new technology to overcome before it can really go mainstream.

Investors in the crypto space should weigh both the benefits and problems of the space when putting their money into any crypto project or asset. The benefits and problems are not set in stone, both can change over time.

Many people believe that Bitcoin has already gone mainstream, but the reality is that outside of the world’s most developed nations and, ironically, some of the most troubled nations (Venezuela, Argentina are two examples) the vast majority of the world’s population has little or no knowledge of Bitcoin, let alone any holdings.

I, therefore, believe that it is still very early days for the crypto space, and that there is enormous potential for growth both in terms of technology and in terms of valuation. However, there are some important hurdles that need to be progressively overcome in order for this crazy experiment to succeed long-term.

These are the big problems that need to be tackled by Bitcoin and other cryptocurrencies in the coming years.

Bitcoin’s Confused Narrative

Bitcoin was created to serve as “a peer-to-peer electronic cash system”, to quote Satoshi Nakamoto in the whitepaper that was released in 2008.

Over time, however, the narrative has mutated and we still don’t have a clear idea of what is really the biggest purpose for holding Bitcoin.

In my view, at the moment, it is clearly the “digital gold” narrative that wins out over all other narratives. The peer-to-peer cash narrative never really took off. People in developed countries nowadays can easily send money to each other using digital banks such as Revolut or N26, and even traditional banks have developed ways for their users to easily send cash to each other. Big transfers remain a good use case for Bitcoin, but most potential users are not really seeking a solution for transferring thousands or millions of dollars between them.

Bitcoin’s Bad Reputation

There are a couple of things that hurt Bitcoin’s reputation, and that of the whole crypto space in general.

  1. The myth that Bitcoin is mostly used for nefarious reasons (money laundering, arms dealing, drugs etc). This myth has been disproved many times but was popular a few years back and many people still believe it.
  2. The second myth that Bitcoin is for those who want to hide their monetary activity and evade taxes. The reality is that Bitcoin only offers pseudonymous privacy and there are several blockchain analysis firms that can determine who is behind an account and to whom they are sending and receiving money from.
  3. Get rich quick schemes, which can be further divided into two:
    1. The ICO craze of 2017 – many people lost money trying to get rich quick investing in things they didn’t really understand.
    2. There are many scams that use crypto as a vehicle. They prey on people’s poor financial and technical knowledge by making ridiculous promises and either cheating them out of their precious Bitcoin or else use the lack of regulation within the crypto space to run their scams with impunity.

When people lose money, they tend to turn against whatever and whoever they blame for that loss, and write off that space completely. It is easier to do that than to admit that you went in beyond your head and didn’t know what you were doing.

The rational thing to do would be to double down on your learning and add a new and higher dose of skepticism when evaluating investments. The emotional thing that is most likely to happen is to write off the whole crypto space as money black hole and vow to stay away from it.

Then there are thoes people who are a bit more experienced and have seen their fair share of scams or even have been burned by some of them (not in the crypto space). Crypto enthusiasts tend to talk about their trading and investments in a way that is very similar to the marketing machines used by scams, so that usually puts these experienced guys on the alert. They then proceed to write off the investment due to this and it being “too complicated”.

Holding Bitcoin is Still Complicated, Cumbersome and Prone to Loss

Not your keys, not your Bitcoin, is a phrase we hear over and over in the Bitcoin community. The idea here is that you should take possession of your private keys by pulling your Bitcoin off exchanges and into your hot or cold wallet.

That’s all well and good, however, the majority of people don’t want to deal wit the anxiety, stress and technical complications of self-custody.

Self-custody usually involves a cold storage device such as a Ledger Nano or a Trezor, which has to be bought and set up. Then you have to transfer your crypto from the exchange to your device, which in itself can lead to losing all your Bitcoin if you copy the addresses incorrectly, although this is a relatively small risk.

Ledger Nano X - The secure hardware wallet

It’s too easy to lose or misplace a seed phrase. Inheritance of such crypto asset setups can be very complicated, as in many cases only the original owner has clear knowledge of how to access the crypto that was stored in cold wallets. The incentive of the holder is to prevent anyone else to have access to their Bitcoin, which is generally a good incentive but becomes a major stumbling block in an inheritance situation.

Solutions such as Casa are a move in the right direction, as they eliminate the need for the seed phrase backup and introduce multisig transactions. They introduce a 3 of 5 key setup. If you misplace one of those keys, it can be rotated out and replaced. By putting customer support in place they also hope that people will be more inclined to practice self-custody, as they are never alone in the whole process but have someone to call if they need help in setting things up or if they are having problems transacting or accessing your Bitcoin. This paradigm is much closer to how people think of their relationship with their banks.

Inheritance is also taken care of through Casa covenant. This involves a 3 of 6 key setup. The 6th key is held by your lawyer who holds it until you pass. Two other keys are accessible within the legal system upon your passing. One of them is held by Casa and the other one is held in a safety deposit box. The latter two keys require a court order issued upon the original owner’s passing to access them.

I think that although Casa’s solution is more robust when compared to a DIY setup, it’s still too complicated for the average person, hence adding one more stumbling block to mass adoption of Bitcoin.

Another solution for inheritance is the dead man’s switch, which passes on information about recovering your Bitcoin to someone else unless you take a particular pre-determined action within a pre-established timeframe. The problem, of course, is that if the owner forgets or is impeded by the tribulations of life from taking that action, then that critical information might end up being passed on before it was intended to.

I think Casa’s solution is a step in the right direction, but its cost might be prohibitive for many people, and hence is probably most suitable for people with significant holdings of crypto assets. The overall problem of Bitcoin/crypto custody remains.

The solution to this problem? I think it’s three-pronged.

  1. I believe there will be a rise of Bitcoin banks in the next few years. These will be licensed and regulated institutions that will be able to hold your crypto assets at a low cost while also insuring those assets against loss. Basically the same way we think of storing our fiat money in banks. This system has been in place for many years and people are used to offloading the responsibility for storing their assets to a third party, so we need to replicate that in the crypto space for mass adoption to take place.
  2. An improvement in the technology and user experience for hot and cold wallets and multi sig solutions. Once the technical barrier is sufficiently lowered, significant portions of the general population will be open to self custody, especially the younger, more tech-savvy generations.
  3. Companies like Casa and Unchained Capital will become ubiquitous and provide the sovereignty and non-confiscatory advantages of self-custody while providing the peace of mind and customer support typically associated with banking institutions.

There is probably another possible solution, and that is that the biggest exchanges will in time start having their holdings insured and become as robust as today’s banks in terms of guaranteeing their customers’ crypto holdings. In that case, self-custody will become less important from the point of view of protecting your investment from loss due to security breaches or bad actions on the exchange’s end.

As far back as 2010, Hal Finney had posted about this topic in the bitcointalk forum, saying that he thought the ultimate fate of Bitcoin would be as a reserve currency for banks that issue their own digital cash.

Time will tell, but it’s exciting to see all the different solutions being proposed and implemented at the moment.

Bitcoin’s Correlation with the Stock Market

Although Bitcoin is frequently touted as an uncorrelated asset and this is, in fact, one of its major narratives, we have seen how its behavior has at times mirrored the stock market very closely. It has behaved very similarly to a tech stock.

For those who are specifically looking for an uncorrelated asset, especially if they are looking at Bitcoin as a potential gold alternative, this is a major downer.

I don’t see this correlation as a big issue and expect Bitcoin to become less correlated as it matures.

Electricity Consumption

This topic has been discussed ad nauseum, and I really don’t think it presents any issues, although it is frequently mentioned as a downside or problem with Bitcoin. Read this article and this follow-up.

Safe and Easy Storage Solutions

Cryptos can easily be lost or stolen by inexperienced users; this is one of the biggest problems I see as most people simply find it too technical or daunting to buy and store cryptocurrencies.

For those investors who are technical enough and have the resources to invest heavily, on the other hand, there is the significant headache of storing hundreds of thousands of dollars worth (or even millions) of crypto. Thankfully, we are seeing new crypto custody solutions popping up, but it’s still early days.

Peer-to-Peer Payments are Still Hard to Do

Most banks have implemented systems that allow P2P payments between friends in a really easy fashion. Although Bitcoin was invented to enabled such peer to peer transactions of value of any size, there is still some way to go until we can say that the average person knows how to do that via his smartphone. Transaction prices are still high for lower transfer values (but the lightning network promises to change that).

Bitcoin Payment Acceptance is Low

There was a time where many online sellers and even brick-and-mortar stores were adopting Bitcoin as a method of payment, but I see less of them these days.

The tax implications of paying for small items with Bitcoin can be big, as in many countries every sale of Bitcoin is a taxable event. So you need to keep track of every item you purchase with Bitcoin during the year (including coffees and other low-value purchases) and calculate the capital gains tax at the end of the year. Few people want to bother with that yet.

Even if we ignore the tax consequences, paying with Bitcoin is still not easy from an app point of view.

In many countries, Bitcoin is not legal tender and cannot be used to purchase big items like a house, car or even pay your taxes. Some states in the US and some countries allow it, but we’re still a long way off.

2017 ICO and Crypto Bubble

Many people still have the 2017 ICO and crypto bubble in their recent memory, where cryptos rose very quickly in value only to come crashing down again a few months later. A lot of people jumped on the bandwagon when the price was rising without knowing what they were getting into, and then logically got burned when the prices declined sharply.

These people are more likely to have written off Bitcoin as they try to stave off the painful memories of losing money. Those who invested in ICOs fared even worse as many ICOs were outright scams.

It’s Not Easy to Get Hold of Crypto

While in some of the more developed countries it is easy to get hold of crypto by purchasing them from an exchange like Kraken or Binance or in a peer to peer transaction, in a lot of countries it’s very hard to get an onramp and offramp to start working with Bitcoin and other cryptocurrencies.

Many banks are still blocking transactions to and from Bitcoin exchanges, and without a way to get their fiat currencies onto an exchange people are thus blocked from getting hold of Bitcoin. The alternative would be to exchange services for Bitcoin, but I personally don’t know anyone who would be ready to pay for services in Bitcoin, so it’s hard to get hold of Bitcoin in this way.

Unclear Legislation

Many countries still have not clearly stated their position with regard to cryptocurrencies, while others have outright banned cryptos. It is important for people to know the following from their governments:

  • Whether the buying and selling of cryptos implies a VAT-able transaction.
  • Whether there are any capital gains taxes when selling at a profit.
  • Whether the holding and usage of crypto is legal or not.

The answers to those questions mostly lies in what financial instrument it considers cryptocurrencies to be. Some treat them as currencies while others treat them as intangible assets; those are the two major categories we’ve seen so far. ICOs, for example, fell into a grey area as what a lot of the companies were selling were actually securities, and they needed to be classified as such.

Some governments also opt not to tax long term capital gains, while others due, implying a huge difference in the ultimate tax bill for investors.

China has banned crypto exchanges from operating in the country while India has announced a ban on the purchase and sale of crypto currencies.

To conclude, while it’s anyone’s guess where the value of Bitcoin will be in a few years time, or whether it will still be the leading cryptocurrency, there’s little doubt that blockchain technology is here to stay, and even institutions like banks and governments are investing huge amounts of money and resources into this technology.

Profiting from Bitcoin

Since I know many people visit this article with the idea of making money from crypto, here are some of the ways you can do so. I purposefully left this section towards the end of the article as it’s very important to educate yourself before you dive in.

Do your own research always, as this is a very volatile space that is in its early stages. Having said that, for those who know what they are doing, the returns can be incredible.

Bitcoin Trading

In these volatile times, there is a big opportunity to make some money just trading Bitcoin. The idea is to buy when the price is suppressed and sell when it is rallying.

If you’re not confident doing that yourself, you can make use of a service like CopyTrading from eToro.

With CopyTrading, trades will be automatically copied to your account allowing you to manage your portfolio in a simple and transparent way. With over 3 million traders to choose from, you can interact with and copy multiple traders.

To get started, create your free eToro account. All information you submit is protected by the latest encryption technology and will not be shared with third parties. Once your account is created, select one of the available payment methods to fund it.

Use the eToro People page to find eToro’s best traders. Make sure to check the traders’  portfolios and trading stats. To base your copy trading portfolio on specific markets (i.e. crypto), use the eToro Markets page to see which investors are trading in the market of your choice.

Once you’ve found the crypto traders you want to copy, simply click on Copy to start copying their positions. You will be asked to specify the percentage of your funds you want to allocate for copying. The amounts for the copied trades will be calculated accordingly.

The trades made by those you’ve chosen will be automatically recreated in your account. You retain full control of your account and can take the trade over, or stop copying a trader altogether, at any time. Finally, always be on the lookout for new trading stars to add to your copy trading portfolio!

Here are a few more tips for trading cryptos:

  • The stock market is only open less than 20% of the time when cryptocurrency markets are open
  • Bitcoin is the most traded on Wednesday and Thursday and the most volatile on Thursday
  • It is the least traded on weekends and also the least volatile

The average volume based on the time of the day shows that the highest volume happens around 10am ET and then gradually decreases until it peaks again around 8pm ET. Volume is the lowest from 10pm to 5am, which is usually the time when most of the people on the East Coast sleep.

Disclaimer

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. 

Cryptoassets are volatile instruments that can fluctuate widely in a very short timeframe and therefore are not appropriate for all investors. Other than via CFDs, trading crypto assets is unregulated and therefore is not supervised by any EU regulatory framework. Your capital is at risk.

Buy and Hold Bitcoin

If it’s your first time getting into Bitcoin, an easy strategy would be to just buy and hold this crypto. I recommend buying from these exchanges:

I would recommend then storing your Bitcoin and other crypto-assets offline using a Ledger Nano or Trezor. You should store the 24-word seed phrase on a Billfodl or Cryptosteel.

If you want to read more about custodying your Bitcoin, read my in-depth article on that subject.

Need Cash? Take a crypto loan instead of selling

‍If you need quick liquidity, you typically sell-off some of your assets. Anyone can run into an emergency situation.

But there are alternatives to selling. Crypto backed P2P loan platforms are very popular, big holders of crypto prefer to get loans in fiat currency using their crypto as collateral instead of selling their crypto.

You could also use your crypto to earn interest using platforms like Youhodler.

While buying and holding has traditionally been the easiest and probably best way to profit from the Bitcoin boom, there are several other ways to make money by getting involved with Bitcoin.

Arbitrage Trading Software

A common scam – avoid outright. There are many websites that promote their software that purportedly generates insane daily profits through some proprietary genius trading and arbitrage techniques.

Predictably, they are all scams and Ponzi schemes, and you are sure to find a referral program meant to be the main driver of any returns. Examples include Bitconnect, Arbistar, Mind Capital and Kualian.

Concluding Thoughts

I think we should focus on the long term, the big picture. If you have faith in this technology you know this is the worst time to panic sell and the best to keep hodling, or better yet, buy more crypto.

The other alternative is to engage in trading, if you have the right skills to do so. In shaky times like these when the price tends to be quite volatile, trading can be a very profitable endeavor.

Given the huge upside potential and promise for Bitcoin, I think that the easiest and most fool-proof strategy right now is to just buy Bitcoin and store it safely. Wait a few years and if all goes according to the ideas exposed above you will be sitting on a nice increase in your net worth.

I like to use the Whatifihodl tool to figure out how much a current Bitcoin stash will be worth in the future based on price projections. You could also use Hodlcalc to see how much Bitcoins bought in the past would be worth today. It’s a great tool if you fancy ending up kicking yourself for not getting involved earlier than you did 🙂

Alternative Currencies to Buy

While you can profit off trading on many cryptocurrencies, if you want to adopt a buy and hold long-term approach, then there is not much worth investing in beyond Bitcoin and Ethereum.

Taxation

You also need to keep in mind that in most countries crypto trading is taxable. Read about how crypto is taxed around the world or how crypto investors have scored a great deal with Portugal.

If you already know how your country taxes Bitcoin and you just want to find a way to quickly prepare your taxes, I strongly suggest you take a look at Cointracker.

This is a service that only tracks your crypto portfolio across various exchanges and cold storage devices, but can also prepare your taxes for you in a few minutes. They can also execute strategies like tax loss harvesting. If you do any trading or use bitcoin for payments this is an essential tool as you will have many transactions to record for tax purposes, and you can’t afford the possible mistakes that come from the tedious manual work of calculations.

In conclusion, I think that we are seeing a clear trend toward Bitcoin adoption. Whether or not you “believe in bitcoin,” it’s here to stay.

It took 12 years, but it’s gained acceptance and there’s no going back.  The companies, asset managers, and governments that stop fighting the rising tide and decide to surf it will be the ones that fare the best.

If you’re ready to buy Bitcoin and cryptos and want to read more about the buying process, do check out my guide to investing in Bitcoin and cryptocurrencies.

Over to You

What are your opinions on Bitcoin and the whole crypto space in general? What are the hurdles that you see going forward, and do you agree with my ideas? Let me know in the comments section below.

Kubera – The All-Inclusive Net-Worth Tracker

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Track your wealth with Kubera

Up until recently and even to quite some extent today, the asset portfolio of many retail investors will prevalently consist of a standard range of assets. This would often include property, vehicles, company stocks and bonds, retirement accounts and insurance, term deposits and bank accounts. These portfolios are, more often than not, partly backed by loans from a local legacy bank.

Over the past decade or so, with the onset of P2P lending and domain flipping in synch with the rise of blockchain technology and the evolving space of crypto (including DeFi, DAOs and NFTs), the menu available to retail investors has been growing exponentially. Not only that – this new era has unwrapped a whole raft of opportunities for new investors who are just making their debut, regardless of their walk of life and net worth.

Apart from the traditional investments I mentioned above, as a retail investor, you will concurrently have your fingers in several cryptos on different exchanges, some of which are staked and others stored across a couple of e-wallets. Your interests could perhaps be also vested in a few P2P lending platforms. Moreover, if you haven’t already taken the leap, chances are you will soon start to throw in a couple of NFTs in the mix.

And with this ever-expanding array of investment opportunities, it is inevitably becoming increasingly complex to systematically keep track of one’s scattered investments, not to mention their current market value. Keeping a manual track via a spreadsheet might cut it for some time, but the longer the list of investments, the harder this will become.

Moreover, in the absence of an up-to-date snapshot of your investments, you will not only find it hard to determine the extent of your profits (hopefully more than your losses), but also find yourself scratching your head when trying to budget your way forward.

Enter Kubera – The Modern-Day Holistic Portfolio Tracker

Kubera is the brainchild of 3 friends who had earlier founded Webyog (database tools) and Newton (a popular email app), after which they had moved on along separate paths, only to come back together to develop this new platform.

In developing Kubera, Rohit Nadhani, Manoj Marathayil and Umesh Gopinath took off from the basic spreadsheets which they used to track their own personal investment portfolios and by combining cutting-edge tech with sensible design, transformed them into a modern portfolio tracking platform, which they named Kubera – the lord of wealth, according to Indian mythology.

The team worked towards ensuring Kubera achieved the following utilities:

  • Listing your assets, traditional and non-traditional, in simple spreadsheet form.
  • Fetching your current asset values automatically whenever possible.
  • Supporting multiple currencies (foreign investments) and crypto.
  • Allowing you to store important docs in a document vault.
  • Purpose-built sharing controls – ensuring the safe transfer of critical info to the person you designate, in case you become incapacitated.
  • Being ad-free under a clean subscription model. In this regard, Kubera stresses that it does not spy on you or sell your data.
  • Being a simple and lightweight platform.

As at the time of writing, the aggregate amount of assets tracked with Kubera amount to $13.5 billion dollars.

How Does Kubera Work?

  1. Connect your bank and brokerage accounts – Connect your accounts to get real-time values of your bank accounts, credit cards, loans, retirement accounts and holdings automatically through Kubera’s multiple aggregators providing connectivity to over 20,000 banks and fintechs around the world. If your brokerage didn’t connect you can simply do a lookup for the stock ticker symbols and add them. Kubera supports all major stock exchanges in the US, Canada, UK, Europe, Asia, Australia and NZ.
  2. Connect crypto wallets and exchanges to get your latest values and holdings. You can otherwise do it manually by looking up your crypto token symbols and adding them. Kubera supports DeFi assets on multiple chains like Ethereum, Polygon, Avalanche, Solana & Cosmos. With Kubera, you can now also track the value of your NFTs from their respective latest prices.
  3. Enter any currency from around the world in the value field and it will convert to your portfolio currency using the latest exchange rates.
  4. Enter the address of your real estate or the Zillow URL to get the latest estimated market price of your property (US Only). For non-US, just insert a new row and enter the value manually which you can obtain from the architect of your choice.
  5. Enter the VIN number to get the latest estimated market price of your vehicles (US & Canada Only). For non-US/Canada just insert a new row and enter the estimated value manually.
  6. Enter your internet domains to get their latest estimated market value.
  7. Enter the metals you’ve invested in as Kubera tracks the gold, silver, platinum and palladium spot prices.
  8. Enter all the assets that can’t be ‘connected’ as manual entries. If possible, enter the cost of your assets as well. If you only know the cost, enter it as the value.

Once you’ve populated all your investments in the given spreadsheet format, Kubera will let you rename or rearrange the sheets and create sections within them.

Kubera will also provide you charts with analytics showing you how your net worth and investments changed over time. Every update to your asset value is kept in history to go back in time to see how you fared. It also allows you to keep an eye on the asset allocation and statistics indicating which asset experienced the highest appreciation or depreciation.

Kubera also calculates accurate rate of returns (IRR) for all your investments based on the multiple contributions & withdrawals and the time invested. It also benchmarks the IRR with the returns from popular indices and tickers (S&P 500, Dow Jones, AAPL, BTC etc.).

Another handy feature of Kubera is the possibility to store important financial or asset documents on the platform.

Through Kubera you will also be able to share a read-only link of your portfolio with others, for example, your Investment Advisor, CPA, or Estate Planner (when applying for loans) or with your household.

In addition, with Kubera’s “Life Beat” feature you can allow portfolio and document access to your beneficiary of choice, however only after extended periods of inactivity. Before Kubera allows automatic access to your beneficiary, you’ll receive multiple prompts to which you can respond with just a click to reset the timer. This feature also comes with a fallback plan – in fact, in addition to your primary beneficiary, you can set a contingent beneficiary (or “Trusted Angel”) who will receive access only in the event that your main beneficiary isn’t able to access your account data.

How Safe is Kubera?

When you think of online security the first thing that comes to your mind is encryption. You may have also heard of ‘end-to-end encryption’ as the gold standard for security. End-to-end encryption makes the data encrypted or unreadable by the very service or the app you used to create it, because the app simply doesn’t hold the keys to decrypt it. It’s only readable by the user who holds the key to decrypt it and no one else.

Given the nature of Kubera’s service, your data in Kubera is not end-to-end encrypted, because it will otherwise not allow the platform to deliver several fundamental features of its service, e.g. background syncing, ensuring safe transfer of your data to your beneficiary as simple Excel and Zip files and many more. Nevertheless, your data in Kubera is indeed encrypted at-rest and in-transit.

At-rest encryption: All Kubera’s databases and files are stored in Amazon (AWS) servers and have their content encrypted while sitting idle and when they’re backed up. This protects against unauthorized copying, transfer or retrieval of user data from the servers. This means that even if someone was somehow able to get hold of a backup of the database, it would be useless, because they wouldn’t have the key to decrypt it.

In-transit encryption: Your data when in transit from Kubera’s servers to your browser requires HTTPS on all pages, and uses HSTS to ensure browsers only ever connect to Kubera over a secure connection.

Kubera also ensures that it does not hold your banking or crypto account credentials. In fact Kubera uses 3rd party financial account aggregator services – Plaid, Yodlee, Flinks and Salt Edge – to connect to your bank and brokerage accounts. Your banking credentials are directly sent to the respective service from your browser. Kubera servers will never see your credentials. The said services will only provide a read-only interface to Kubera. Therefore Kubera cannot make any transactions on your behalf.

Similarly, for crypto exchanges and wallets, Kubera only requires read-only permissions, whether you use API or secret key and/or passphrase. For certain wallets like Bitcoin, Ethereum, Ripple, Doge, etc., Kubera only needs the blockchain address.

From a read through Kubera’s website, it seems that sensitivity of its customers data is top of mind and in this respect, Kubera ensures it has Bank Grade security in place to protect this data. Kubera also stresses that it doesn’t sell your data to show ads, nor do they peek at it to offer you financial products.

A further layer of security is Google ID sign-ins which incorporates Two-factor authentication.

Subscription Fees

Kubera never sells your data and in fact is only funded by your subscription fee. The tariff scheme is pretty straightforward, with a $150 per annum fee for personal accounts and bespoke tariffs for customers who manage a pool of portfolios for other private clients. While this may seem a little expensive, I believe that given the valuable utility of Kubera’s service in terms of serving as a one-stop-shop for wealth management, the said fee is a reasonable one.

Customer Support

Kubera offers personalized customer support via email. Their website also contains a help center with an extensive FAQ section. The platform is available both in desktop and app mode (both Apple and Android).

What I found particularly good is the blog on Kubera’s website which is regularly updated with relevant articles relating to investments. To me this indicates that Kubera is not only keen on being there for its users but is also proactive at educating their investment decisions.

A quick scan through Reviews.io relays a wide consensus that Kubera’s service is going down exceptionally well with its clientbase. Common traits that I picked from the comments related to the platform’s user-friendliness and vast integration. On the other hand some users indicated that they found the annual fee a bit pricey.

Kubera’s Edge Over Traditional Wealth-Tracking Platforms

A modern portfolio tracker that’s able to keep up with all of your financial accounts is key to successful wealth management. It will go a step further by enabling you to integrate your various digital assets stored across different wallets and exchanges and automating conversions so you can view the value of such investments in real-time.

As such, Kubera will empower you to work with up-to-the-moment financial data from all of your accounts to generate effective reports, forecasts, and plans for moving your financial goals forward.

This is where Kubera has an edge. It’s not that all of the big portfolio trackers and dashboards on the market are inherently bad. The problem is that most of them have a fatal flaw — or a combination of several — that makes them ill-prepared for the digital asset reality toward which most modern investors are moving.

Some of the main flaws which traditional big portfolio trackers carry include:

a) Poor crypto integration capabilities – The problem with many of the popular portfolio trackers today is that they typically only partner with one or maybe two financial app aggregators. These aggregators are typically built to work in certain countries with specific currencies and financial institutions. That is why the more aggregators a portfolio tracker works with, the more diverse account and asset types the tracker will be able to help you monitor and manage.

b) Inability to view crypto and other digital assets as part of your net worth (or in your preferred currency) – It is pretty hard to keep track of the value of crypto at any given time if you’re using technology that was developed well before the idea of digital currency. And as a result, it’s also hard for these more traditional tools to display the real-time value of your crypto investment in your preferred currency.

c) Outdated security measures – crypto has been set up in a way to promote more democratic and failure-proof usage compared to traditional currency and other assets. However, it also means crypto transactions are almost impossible to stop once they are actioned. Hence, financial management apps need to make sure their security is up to par to protect users who are after integrating their crypto accounts. In addition to security measures such as encryption and two-factor authentication, the same aforementioned third-party aggregators that Kubera works with are helpful for preventing hacks by processing user credentials, rather than Kubera itself accessing and storing these credentials.

Concluding Thoughts

Kubera helps you to organize all your wealth in one place and keep regular track of your net worth in a very simple intuitive way. Security-wise it also ensures safe transfer of this information to your chosen beneficiary.

Through its user-friendly dashboard Kubera will empower you to work with real time financial data from all of your accounts to generate effective reports, forecasts, and plans for moving your financial goals forward.

In the meantime the team at Kubera remain up-to-date so as to keep their platform as comprehensive as possible in terms of swiftly incorporating any up and coming alternative assets.

From a number of customer reviews, Kubera seems to be a good bet, which albeit comes at a somewhat above-par subscription of $150 per year, lives up to the claim of being the modern-day holistic portfolio tracker.

Track your wealth with Kubera

 

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Jean Galea

Investor | Dad | Global Citizen | Athlete