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Should You Buy Bitcoin in 2021?

Last updated: April 26, 202331 Comments

Kraken

Buy Bitcoin on Kraken 

As Bitcoin continues to have an amazing bull run in 2021, 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 as 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:

  • Buy Bitcoin on Binance – the exchange with the biggest volume worldwide) – read my review
  • Buy Bitcoin on Kraken – the biggest Euro volume exchange – read my review

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 Nexo and YouHodler, 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:

#Bitcoin is $40,400 right now.

You could have bought it for $29,000 last week. Still waiting for the dip?

— Bitcoin Archive (@BTC_Archive) February 6, 2021

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?

Last year, after the March dip, I had written about that being 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. In 2021, it seems that the bull market is back in full swing.

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 now, Bitcoin seems to be following the stock-to-flow model. Proponents of this model had predicted that the price of Bitcoin should reach somewhere between $100k and $200k at some point in 2021 or 2022. 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 much more realistic now that Bitcoin has broken through $40k. 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 Hoarding

During bull markets, the long term Bitcoin holders hoard the supply in anticipation of a major price increase. As of November 2020, over 62% of the Bitcoin supply hasn’t moved in over one year (all-time-high). This is  a very bullish indicator.

All indications say we’re at the beginning of the next major bull run. Smart money is flooding in, “bad news” doesn’t negatively affect the price, and the existing investor base is hoarding the outstanding supply.etoro buy bitcoin

Bitcoin as a Safe Haven

The US federal reserved printed ungodly amounts of dollars last year 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.

2/ Assuming a 5% investment allocation and a 2% inheritance tax, by 2044 Gen X and Millennials could invest an estimated $971 billion into #Bitcoin as they inherit wealth.

World investment could make this figure much higher. pic.twitter.com/r0VV97HIgz

— Kraken Exchange (@krakenfx) March 25, 2020

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.

Network Effects

Crypto, or digital assets, are a highly correlated space. The best coins will always have the softest bear markets, and it is becoming clear that Ethereum wasn’t much worse on the COVID correction and is punching above its weight in the rally. With a network value around 15% of Bitcoin, there is the potential for a catch-up, but its network is smaller on the most important measures.

Crypto valuation is all about the network. While Ethereum processes a large number of transactions, they tend to be small. It won’t catch up unless its network sees a surge in transaction value, which means either many more transactions or to attract a greater share of the larger ones. But this is a youthful space, and anything is possible in crypto.

In the meantime, Bitcoin is heading back to $20 billion of network transfer each week. So long as this goes up, so will the price of Bitcoin.

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.

Startup Crypto Bank Avanti Unanimously Wins Wyoming Bank Charter: Avanti Founder and CEO Caitlin Long, a Wall Street Veteran who used to run Morgan Stanley’s pension advisory group, expects the bank to launch sometime in 2021.

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:

2020 was a massive year for Crypto

The year 2020 will be one to remember due to the devastating effects on humanity and the economy as a result of COVID and government policies, but crypto just had an amazing year.

We had the DeFi summer and the long-awaited institutional buying of Bitcoin, as well as the launch of the ETH2 beacon chain and many other big events. Here’s an infographic illustrating the major crypto events of 2020:


What the Charts and Indicators Show

Let’s take a look at some charts.

Financial predictive models are a graphical way of displaying different investment thesis, and while some do remain valid long-term, it’s important to keep in mind that they are constructed by looking back at what the price has done in the past, and this might not reflect what it will do in the future, as there are so many factors that might come into play.

However, I still like to follow several models and indicators as I feel they give me a better sense of the current scenario.

The Stock to Flow Model

The stock-to-flow model for Bitcoin was popularised by Twitter user @planb and is all about modeling Bitcoin’s value with scarcity.

This model treats Bitcoin as being comparable to commodities such as gold, silver or platinum. These are known as ‘store of value’ commodities because they retain value over long time frames due to their relative scarcity. It is difficult to significantly increase their supply i.e. the process of searching for gold and then mining it is expensive and takes time. Bitcoin is similar because it is also scarce. In fact, it is the first-ever scarce digital object to exist. There are a limited number of coins in existence and it will take a lot of electricity and computing effort to mine the 3 million outstanding coins still to be mined, therefore the supply rate is consistently low.

Stock-to-flow ratios are used to evaluate the current stock of a commodity (total amount currently available) against the flow of new production (amount mined that specific year).

For store of value (SoV) commodities like gold, platinum, or silver, a high ratio indicates that they are mostly not consumed in industrial applications. Instead, the majority is stored as a monetary hedge, thus driving up the stock-to-flow ratio.

A higher ratio indicates that the commodity is increasingly scarce – and therefore more valuable as a store of value.

Bitcoin stock to flow

As you can see in the chart (as at January 2021), the price is tracking the model very closely and seems to be on course to the $100,000 level where the model predicts things will flatten out for a few years until the following halving.

A more detailed version of the chart and explanation of what everything means can be found here.

Net Unrealized Profit/Loss

Profit and Loss metrics answer the question: if all units of a given currency were sold today, how much would investors stand to gain or lose?

By looking at the delta between the price when a UTXO was created vs. the current price of an asset, we can determine whether the specific coins in that UTXO are in a state of unrealized profit (price has increased) or loss (price has decreased). When looking at this across the entire network, we can see how much of the network is in profit, and how much is in loss.

net unrealised profit bitcoin

NUPL (Net Unrealized Profit/Loss) specifically looks at the difference between Unrealized Profit and Unrealized Loss to determine whether the network as a whole is currently in a state of profit or loss.

Any value above zero indicates that the network is in a state of net profit, while values below zero indicate a state of net loss. In general, the further NUPL deviates from zero, the closer the market trends towards tops and bottoms. As such, NUPL can help investors identify when to take profit (blue) and when to re-enter (red).

The Rainbow Chart

Here’s the Bitcoin rainbow chart as at January 2021. The Rainbow Chart is meant to be a fun way of looking at long term price movements, disregarding the daily volatility “noise”. The color bands follow a logarithmic regression (introduced by Bitcointalk User trolololo in 2014), but are otherwise completely arbitrary and without any scientific basis.

Whilst the original chart was graded as simply ‘buy’, ‘sell’ or ‘average’, this has now taken on a finer delimitation.

At the top end we have ‘maximum bubble territory’, going through sell indicators, building FOMO, and down to ‘HODL!’ in the middle yellow band.

On the lower end of the spectrum, the scale goes through various levels of good value, down to the final ‘basically a fire sale’ band.

Back in March 2020, I had written about it being a fantastic time to stockpile on Bitcoin. To zoom in on the chart then:

This doesn’t prove anything about the chart, but it did work perfectly well in the last dip. Right now, it seems like we’re heading into some shaky territory where a good dip would not be that unexpected. However, there still seems to be some room for growth.

The Bitcoin-gold rate peaks at an all-time high

Early on the morning of January 1st, the Bitcoin-gold rate peaked at 15.62 ounces, surpassing the December 2017 peak of $29,000. Even though gold also experienced large gains in 2020, these gains were minimal in comparison to Bitcoin’s meteoric rise. Gold ended the year with a 25% gain while Bitcoin had an increase of 300%. Investors seem to be choosing the “efficiency” and “portability” of digital currency over gold.

JPMorgan Chase analysts believe Bitcoin’s digital gold narrative is taking capital from precious metals. It is thought that Bitcoin’s supply shortage will drive its prices higher as 2021 progresses.

HODL Waves

The HODL Waves is a data visualization that displays colored bands representing the percentage of total bitcoin and the length of time that bitcoin has been sitting in a given address. This visualization is made possible because the bitcoin blockchain is completely public. You can read the original article that describes them here. By comparing the age of bitcoin sitting in addresses to the current US dollar prices, we can make some interesting conjectures about the bitcoin economy and the sentiment of HODLers.

hodl waves 2020

While the price crash in March was sharp, we can see that the coins shifting hands during that time were coins that had previously moved within the last 6 months, indicating that the crash may have been caused by leveraged traders getting liquidated. Long-term holders were unaffected by the movement, meaning that coins that had been sitting in addresses for longer than 6 months became a higher percentage of the total bitcoin sitting in addresses. This helps explain the rapid 2 month recovery back to the previous prices.

On-chain data provided by Coin Metrics also shows that recent price movements were likely mostly driven by shorter-term and relatively new holders. Long term holders appear unfazed in spite of the severe market downturn.

While market cap for most cryptoassets fell, the market cap for most stablecoins increased. This potentially signals that investors were piling into “cash,” or at least crypto cash equivalents.

As of January 2021, we can see that 59.03% of bitcoin has been held for longer than 1 year. That is still a long way away from the bottom of the last cycle, which was April 10, 2018 at a price of $6,839 (after running up from $172 in January 2015), when only 41.1% of available bitcoin was held for 1 year or longer. If the 2018-2020 HODL wave looks anything like the last one, we can expect some extreme price movements as new entrants try to recapture that ~18% difference between 59.03% and 41.1% of long-term held bitcoin.

The Relative Strength Index

The relative strength index (RSI) is a momentum indicator used in technical analysis that measures the magnitude of recent price changes to evaluate overbought or oversold conditions in the price of a stock or other asset. The RSI is displayed as an oscillator (a line graph that moves between two extremes) and can have a reading from 0 to 100. The indicator was originally developed by J. Welles Wilder Jr. and introduced in his seminal 1978 book, “New Concepts in Technical Trading Systems.”

Traditional interpretation and usage of the RSI are that values of 70 or above indicate that a security is becoming overbought or overvalued and may be primed for a trend reversal or corrective pullback in price. An RSI reading of 30 or below indicates an oversold or undervalued condition.


Who is investing in Bitcoin?

In case you think it’s just some weirdos and crazy retail investors who are piling into Bitcoin, have a look at what these well-known professional investors are saying:

Legendary global macro investor Raoul Pal says he’s never seen a trade as dominant as Bitcoin.

J.P. Morgan, whose CEO Jamie Dimon called bitcoin a fraud just three years ago, published an in-depth feature in its flagship research series comparing bitcoin to gold, and saying its price could double or triple if current trends continue. Earlier this year, J.P. Morgan also agreed to provide banking services to crypto pioneer Coinbase, and has been getting involved in additional ways.

Billionaire U.S. investor Stanley Druckenmiller is long on bitcoin. In a Monday CNBC appearance, Druckenmiller disclosed a bitcoin position significantly smaller than his gold horde. However, he predicts bitcoin will outperform gold in the long run – largely due to millennial and Silicon Valley attraction to the crypto scene. “Frankly, if the gold bet works the bitcoin bet will probably work better because it’s thinner, more illiquid and has a lot more beta to it,” he said. Drunkenmiller made headlines last week for his bearish views on the U.S. dollar, which he suspects will decline for the next three to four years.

Mutual fund titan Bill Miller has also taken a fancy to bitcoin. “One of the things that’s interesting about bitcoin is that it gets less risky the higher it goes,” Miller told CNBC in a January 2021 interview. “That’s the opposite of what happens with most stocks.” He also said that “Bitcoin could be rat poison, and the rat could be cash.” in his fund’s latest investment letter, referring to a similar comment of the opposite effect from Warren Buffett.

Miller continued to describe bitcoin as “a supply-and-demand story” with roughly 900 bitcoins created each day and a swarm of retail and institutional investors scooping up enormous chunks of available supply.

The Grayscale Bitcoin Trust has accumulated more than 3% of the total bitcoin supply. That’s according to Bloomberg, which interviewed CEO Michael Sonnenshein for the piece.

The interesting thing about what happened in the Q4 Bitcoin price run-up, is that most retail investors were sitting by the sidelines.

There were relatively few new investors joining in the fun. The big reason, in my opinion, is that most people were acting extra cautious during 2020 as the reality is that a lot of jobs and businesses were and are still threatened. If you don’t have a lot of extra cash lying around, you most likely have your money invested in assets that are hard to sell at the moment, or you’re just sitting in cash due to the uncertain situation.

While the smart money was accumulating Bitcoin, retail interest only increased slightly.

Historically, retail floods into Bitcoin after breaking previous all-time-highs. If history repeats, Bitcoin is going to be explosive over the coming 18 months.

Now that we started 2021 so strongly, we are seeing retail investor interest go up a few notches, and this can be verified using social signals as well as tools like Google Trends.

Google trends bitcoin

This chart from January 2020 shows the historical interest on the web for the term “buy bitcoin”. You can see a peak at the end of 2017 where we had the previous big runup. If you were aware of Bitcoin back then, you might remember that many people were talking about it, and it wasn’t uncommon to hear even taxi drivers and grandmothers talking about their Bitcoin investment. I don’t see that kind of thing happening again just yet, which further lends credibility to the idea that this time it’s different and the price going higher is driven by institutional investing rather than retail.

Companies Moving their Reserves to Bitcoin

Many public and private companies have started to adopt Bitcoin as their reserve currency.

Here is a list of the biggest corporate holdings:

  • MicroStrategy – 71,079 BTC
  • Tesla – 43,000 BTC
  • Galaxy Digital Holdings – 16,402 BTC
  • Mass Mutual – 5,300 BTC
  • Marathon Patent Group – 4,813 BTC
  • Square – 4,709 BTC
  • Hut 8 – 2,851 BTC
  • Voyager Digital – 1,239 BTC
  • Riot Blockchain – 1,175 BTC

Tesla, led by the world’s richest man Elon Musk, invested $1.5 billion of its cash reserves in bitcoin, according to a U.S. Securities and Exchange Commission annual report. The popular auto manufacturer said bitcoin offers “more flexibility to further diversify and maximize returns on our cash.” The company had more than $19 billion in cash and cash equivalents at the end of 2020.

Microstrategy was the first to publicly announce their move by purchasing 21,454 bitcoins at an aggregate purchase price of $250 million., but others have followed hot on their heels, including the e-payments giant Square, led by Twitter founder Jack Dorsey.

This was followed up with another purchase in September 2020.

On September 14, 2020, MicroStrategy completed its acquisition of 16,796 additional bitcoins at an aggregate purchase price of $175 million. To date, we have purchased a total of 38,250 bitcoins at an aggregate purchase price of $425 million, inclusive of fees and expenses.

— Michael Saylor⚡️ (@saylor) September 15, 2020

Even then, Saylor wasn’t content with his company’s stash. He went ahead and raised $650 million to purchase more crypto in December 2021.

MicroStrategy has purchased an additional 29,646 bitcoins for $650 million at an average price of $21,925 per #bitcoin and now #hodl an aggregate of 70,470 bitcoins purchased for $1.125 billion at an average price of $15,964 per bitcoin.https://t.co/j6wVLXIzoa

— Michael Saylor⚡️ (@saylor) December 21, 2020

Think he’d had enough then? Of course not. He went ahead and bought some more in January 2021.

MicroStrategy has purchased approximately 314 bitcoins for $10.0 million in cash in accordance with its Treasury Reserve Policy, at an average price of approximately $31,808 per bitcoin. We now hold approximately 70,784 bitcoins.https://t.co/zMJSH29bmC

— Michael Saylor⚡️ (@saylor) January 22, 2021

Here’s why, in his own words:

“This investment reflects our belief that Bitcoin, as the world’s most widely-adopted cryptocurrency, is a dependable store of value and an attractive investment asset with more long-term appreciation potential than holding cash. Since its inception over a decade ago, Bitcoin has emerged as a significant addition to the global financial system, with characteristics that are useful to both individuals and institutions. MicroStrategy has recognized Bitcoin as a legitimate investment asset that can be superior to cash and accordingly has made Bitcoin the principal holding in its treasury reserve strategy.

MicroStrategy spent months deliberating to determine our capital allocation strategy. Our decision to invest in Bitcoin at this time was driven in part by a confluence of macro factors affecting the economic and business landscape that we believe is creating long-term risks for our corporate treasury program ― risks that should be addressed proactively. Those macro factors include, among other things, the economic and public health crisis precipitated by COVID-19, unprecedented government financial stimulus measures including quantitative easing adopted around the world, and global political and economic uncertainty. We believe that, together, these and other factors may well have a significant depreciating effect on the long-term real value of fiat currencies and many other conventional asset types, including many of the assets traditionally held as part of corporate treasury operations.”

I believe other private and public companies will follow suit.

#Bitcoin provides Integrity to the digital monetary system. Liquidity, Scalability, Security, Functionality, Performance, Compatibility, Accessibility, Compliance, & Popularity will be delivered by those individuals, enterprises & agencies that support the Bitcoin Standard.

— Michael Saylor⚡️ (@saylor) November 1, 2020

This means that Bitcoin is much harder for any government to ban, plus it also means that millions of people are now indirectly invested into Bitcoin by holding shares of these companies.

It’s really exciting to see so many companies hold large Bitcoin treasuries. Here’s a list of publicly trading companies that have publicly announced their Bitcoin positions.

Morgan Stanley Acquires 10.9% of MicroStrategy

The financial giant, Morgan Stanley, has purchased 650,000 shares in MicroStrategy boosting its total to 792,627 and bringing its total ownership in the company to 10.9%.

Why?

The same reason why so many retail investors have been investing in MicroStrategy, sending its stock price through the roof.

MicroStrategy’s shares are largely tracking the price of bitcoin. Therefore, it’s hard for one to not assume that this is a strategic move on the institutional giant’s part. Morgan Stanley will be looking to benefit from bitcoin’s historic run without actually having to become a HODLer.

Keep in mind that for many people around the world it is still very hard to buy Bitcoin due to laws in their countries, banking obstacles, etc. But buying a stock is a much more straightforward affair, so for now MicroStrategy acts as a proxy for Bitcoin.

Cities Buying Bitcoin

Francis Suarez, the mayor of Miami, announced his interest in acquiring Bitcoin for the city’s reserves, in yet another domino effect moment. Not only that, he is working day and night to turn Miami into a hub for crypto innovation.

The City of Miami believes in #Bitcoin and I’m working day and night to turn Miami into a hub for crypto innovation.

Proud to say Miami is the first municipal government to host Satoshi’s White Paper on government site. @balajis @tyler @cameron @APompliano pic.twitter.com/DBOni23ynY

— Mayor Francis Suarez (@FrancisSuarez) January 27, 2021

WOW! Miami Mayor @FrancisSuarez just got Miami into Bitcoin.

– Employees paid in BTC
– Residents pay fees in BTC
– Taxes in BTC
– City Treasury in BTC

Absolutely unreal. The first Bitcoin municipal in the United States 🔥 pic.twitter.com/zv7rM7C39B

— Pomp 🌪 (@APompliano) February 12, 2021

That’s the power of Bitcoin. Not only has it provided the opportunity for a wealth transfer, but it’s also changing the geographical hierarchy of the world. Those cities and countries that embrace Bitcoin and freedom will gain an edge over those that don’t.

It’s only a matter of time before more cities buy Bitcoin, and shortly after countries will announce it. By then, there would be no doubts whatsoever about whether governments will ban Bitcoin.

Countries Accepting Tax Payments in Crypto

The Swiss canton of Zug – dubbed “Crypto Valley” thanks to the many digital-asset companies drawn to the jurisdiction because of its friendly blockchain and crypto regulation – has started accepting tax payments in cryptocurrency. For now, there’s a cap of 100,000 Swiss francs ($111,300). “As the home of the Crypto Valley, it is important to us to further promote and simplify the use of cryptocurrencies in everyday life,” said Zug’s finance director, Heinz Tannler, when the tax initiative was announced.

The PayPal Effect

PayPal, Cash App, Revolut and others have also contributed to Bitcoin’s high demand and its subsequent shortage. Grayscale Capital also deserves a mention in this section. All these companies have been scooping up Bitcoin to offer it to their customers.

Financial services giant PayPal ($250 billion market cap) was huge news towards the end of 2020, as it announced that it will allow its ~200M U.S. users to buy, sell, and store cryptoassets on its platform, starting with Bitcoin, Ethereum, Bitcoin Cash, and Litecoin. This opened up Bitcoin investing to millions of users who previously did not have the confidence or skills to get themselves some Bitcoin, but can now purchase it through a familiar interface. Given that PayPal is used by people of all ages and nationalities, this is a really important development.

What’s more, the firm said it would enable its 26 million merchants to accept crypto as a payment method, starting in early 2021. This news was huge. It was likely the biggest development of 2020 for crypto. It represents a major leveling-up of the asset class.

The news sent crypto prices sharply higher. Bitcoin rose more than 10% to a multiyear high above $13,000, and other assets followed, including Litecoin, up 15%.

Not to mention the fact that huge players like PayPal making moves like these make it less and less likely that the US government will ever make any drastic moves such as banning bitcoin outright.

Today, the largest crypto wallet, Blockchain.com, has 50 million users. Coinbase has 40 million, Square has 30 million, and Robinhood has 12 million. At nearly 200 million U.S. users, PayPal is 4x the size of the largest existing platform.

PayPal’s smaller competitor Square allows users to buy and sell bitcoin through its Cash App. Flows have been significant: In Q2 2020, for instance, CashApp users purchased $875 million of bitcoin.

In addition to demand for investment purposes, PayPal is uniquely suited to finally break down the door to the widespread use of crypto as a payment vehicle.

By early 2021, PayPal’s 26 million merchants will be able to accept payment in bitcoin, ethereum, Litecoin, and Bitcoin Cash. These merchants aren’t just large firms like eBay, but millions of small businesses processing transactions over the internet. In many ways, you could imagine they might be the most likely audience to embrace crypto.

PayPal’s initial retail push will have limitations. But if even just 0.1% of retailers start accepting crypto payments, you have the beginnings of a real commerce use case that has long been sought by the industry.

The final reason this is a big deal is simply that PayPal is a significant business; more significant than many people think.

PayPal today boasts a market capitalization of $250 billion, significantly larger than Bank of America ($208 billion), Wells Fargo ($93 billion), Morgan Stanley ($91 billion), Citi ($89 billion), and Goldman Sachs ($70 billion), among others.

They’re also a highly regulated money transmitter and financial institution. PayPal’s move shows other such institutions that crypto is now possible on the largest possible scale.

Mastercard, another big player, is planning to give merchants the option to receive payments in cryptocurrency later in 2021.

In fact, a recent letter published by the Office of the Comptroller of the Currency clarified that national banks can custody cryptoassets themselves. With PayPal now leading the way, what reasons do banks and other payments companies have for not offering comparable services?

ETFs are Coming

Crypto ETFs have long been in the pipeline, however, the US SEC has refused all of the applications so far.

In February, however, the Ontario (Canada) Securities Commission gave the go-ahead to the first Bitcoin exchange-traded-fund (ETF) in North America. The portfolio will be managed by Purpose Investments and will be listed on the Toronto Stock Exchange in Canadian Dollars.

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:

  • Binance
  • Bitpanda
  • CoinSmart
  • CoinMama
  • Changelly

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.

Cloud Mining

Cloud mining consists of contributing fiat money to join a mining pool. Genesis is probably the only mining pool that I would trust as of 2020, however profits are far from guaranteed and I think it’s still too risky a proposition compared to just buying and holding, so I have so far avoided getting involved in mining.

You could, of course, also set up your own mine, but at this stage, you would need a big investment and be very technical to even have any chance of successfully doing this. Unless you’re a mining expert, don’t even think of setting up your own mining setup.

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

When this is over

➡️The fed will have printed trillions
➡️USD will have lost value
➡️Leaders will have lost credibility

✅There still won’t be more than 21M $BTC
✅#Bitcoin will still be the hardest money ever created
✅Next block: still in 10 min

See you on the other side!

— Lina Seiche (@LinaSeiche) March 13, 2020

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.

If Bitcoin can remain decoupled from US Equities & the market treats it as Digital Gold, 2021-2022 should be an amazing cycle for BTC. Always follow the present strongest force as that drives market direction – Presently, that is the Demand Side fueled by Funds & Retail Money.

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 kick yourself for not getting involved earlier than you did 🙂

Alternative Currencies to Buy

While there are many hardcore Bitcoiners who think that all other cryptocurrencies are rubbish, I would disagree. I’ve written about a number of other cryptocurrencies that are worth looking into, and due to the growth of DeFi I would say that Ethereum is one, in particular, to keep an eye on.

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 towards 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.

Filed under: Cryptoassets, Money

📈 What is the Best Cryptocurrency Portfolio Tracker?

Last updated: April 26, 202355 Comments

Buy cryptos

With thousands of crypto tradeable assets available, it is hard to keep track of your crypto portfolio these days. Even if you’re just buying and selling one or two different coins, you can quickly lose track of things, especially if you’re using several crypto exchanges or trading apps like Binance, Kraken, Binance etc. Not to mention if you’ve been dabbling around in DeFi and DEXes like Uniswap and Sushiswap.

It is also important to track other crypto-related activities, for example when earning interest on your crypto through platforms like Nexo and YouHodler.

You could also be using one of the various crypto debit and credit cards, like Crypto.com, where for tax purposes you will need to keep track of every single purchase done with your card.

As you can see, it is important to know your positions in an easy way, and there is no better way than to use an app or software solution.

You need to know where you stand at all times:

  • to keep track of your overall investment
  • to be prepared when tax time comes along

Here are my favorite portfolio tracking and tax preparation tools.

CoinTracker – 10% Off for my readers

Bitcoin_Taxes__Crypto_Portfolio___Prices___CoinTracker

CoinTracker is the most complete portfolio tracker on the market. They have automatic import from exchanges built-in, and the interface is very clean. Their support is fantastic, and best of all, everything is free for those with few transactions. This is the system I would have built if I had to build a tracker myself.

If you’re a power user then there are several well-priced tiers that are completely affordable.

See also: My detailed review of Cointracker

Of course, CoinTracker also calculates crypto taxes every year for you. Given that it’s still so hard to find competent accountants who understand crypto (plus it would be very expensive), it’s well worth it to pay for a tool like this that prepares everything for you. At any point, you can review your tax summary, and download the reports you need to file your taxes. Cointracker is seamlessly integrated with TurboTax and your accountant’s software. Full support is offered in US, UK, Canada, Australia, and partial support for every other country. They are adding full support for other countries too, so check out the CoinTracker site for the latest list.

I’ve spoken to the founder of CoinTracker on my podcast Mastermind.fm, so check that episode out if you’re interested in learning more about the platform and crypto taxation in general.

You can not only connect it to your exchanges to pull in all the data about trades you’ve made, but you can also mark transfers to your Ledger Nano or other cold wallets so that they are not deducted from your overall balance.

In terms of exchanges, they practically support every exchange out there, including my favorites Binance and Binance. You can import your data automatically via API or upload a CSV of all your trades. Cointracker uses read-only access to your exchange accounts to protect your funds. That is very very important as it means that Cointracker will never have any permission to operate with your crypto.

Read more: The Best Books about Bitcoin and Crypto

I like the fact that you will still have access to the vast bulk of features on the Free Plan – especially capital gains reporting and your choice of accounting standards. At the other end of the spectrum, CoinTracker is especially useful if you actively trade cryptocurrencies.

Although you will need to pay a fee for anything above 25 transactions, the application has the potential to save you countless hours of manual reconciliation. In fact, you will stand the best chance possible of avoiding a mistake that in the long-run, could end up costing you significantly more in tax authority fines.

Sign up to Cointracker and get 10% off your first tax plan

CoinTracking

Cointracking

CoinTracking analyzes your trades and generates real-time reports on profit and loss, the value of your coins, realized and unrealized gains, reports for taxes and much more. With the prices for 7666 coins and assets, you’ll always have a complete overview.

  • 620K+ Active Users
  • 750+ CPAs & Corporate Clients
  • 11 Years of Historical Data
  • Coin Trends for 7666 Coins
  • $4.3B Total Value of all Portfolios

This is one of the earliest and most complete services available out there. They have two offerings, one for crypto traders and the other for crypto companies.

See also: My detailed review of Cointracking

CoinTracking.info has one of the most extensive customer service areas I have seen on tax reporting platforms. It has an elaborate documentation section that covers almost every question you might have. It also has a separate FAQ that caters to the most commonly asked questions.

There is even a CoinTracking.info robot ready at your disposal. This is all aside from the typical customer service tools such as communities, live chat, video tutorials, and email contact. There is also a demo version of the website available that can give you a good idea of what to expect once you start using the platform.

This service offers a broad and comprehensive analysis of your crypto portfolio – which allows you to manage all your digital currency accounts at once.

Moreover, its longstanding reputation has allowed the CoinTracking.info team to update the platform regularly to cater to the changing needs of the crypto community.

To ensure the provider is right for you, CoinTracking.info also offers a free account to help you understand whether the platform can fit your tax reporting needs. Overall, CoinTracking.info comes across as one of the most efficient management tools you can use for your crypto portfolios.

Get your 10% discount on Cointracking plans

Koinly

Koinly crypto tax preparation

Koinly was established in 2018 and has already generated more than 11,000 tax reports for its clients.

I like it since it’s not 100% US-focused, and as such you can use it to prepare your German, Italian, Spanish, French taxes along with many other countries. The team behind Koinly is composed of tax lawyers, accountants and engineers who study the tax implementations of many countries and make sure the software can support these systems as well as a plethora of worldwide exchanges.

See also: My detailed review of Koinly

Koinly automatically imports your transactions, finds all the market prices at the time of your trades, matches transfers between your own wallets, calculates your crypto gains/losses and generates your tax reports.

Check out Koinly

Cointelli

Cointelli is one of the most recent additions to the crypto tax reporting tools and to date, it is only available to US-based crypto investors who are after obtaining automated US-tax reports.

Established in 2021, Cointelli’s service is intended to ease the pressure of accurate tax reporting by automatically compiling your transactions from across your wallets and exchanges. Once it generates your transaction list, Cointelli’s software will consequently help you to easily fix any errors therein, prepare a comprehensive report for tax purposes based on the latest tax provisions and have it sent out to your accountant or other relevant tax platforms.

Apart from freeing up a great deal of precious time, Cointelli places a lot of effort into helping you generate the required stats and reports as accurately as possible, thus saving you from paying any unnecessary tax.

Cointelli’s pricing structure is lean with a one-size-fits-all price for consumers and customized packages for large transaction-volume enterprises. For a flat annual fee of $49, clients can benefit from all the Cointelli suites and services for up to 100,000 crypto transactions, be it DeFi, margin trades, or NFTs. This is very competitive pricing, particularly when a number of other platforms offering similar services, already start charging a higher fee as soon as transaction volume exceeds 100.

Cointelli also scores high in terms of support. It not only offers customer support via email and chat widget, but also provides 24/7 live customer service with dedicated tax experts.

Get your crypto tax report with Cointelli

CryptoTaxCalculator

Cryptotaxcalculator

  • Direct support for hundreds of exchanges, including Binance, Binance, and Kraken.
  • Handles staking rewards, airdrops, margin/futures trading, perpetuals, lost/stolen funds, ICOs, and much more.
  • Direct support for DeFi protocols such as Uniswap, PancakeSwap, Binance Smart Chain.
  • Pricing is an annual subscription, and you can cancel anytime, with a 30 day money back guarantee.
  • The plan covers all historical tax years so if you need to amend your tax return for previous tax years the plan has you covered.
  • Prices range from $49 (100 transactions); $99 (2,500 transactions); $249 (10,000 transactions), $399 (100,000 transactions).

Open an account with CryptoTaxCalculator

TokenTax

Tokentax

TokenTax is a crypto tax software platform and a full-service cryptocurrency tax accounting firm. This tool also takes care of tax-loss harvesting. If you hold assets at a loss, then you can save money on your taxes. TokenTax’s Tax Loss Harvesting dashboard tells you exactly how much losses you can claim by strategically selling off assets.

Read more: My in-depth review of TokenTax

Tax loss harvesting is selling off assets you hold at a loss to reduce your capital gains. When you reduce your capital gains, you owe less taxes. And, if you take a loss in crypto, you can offset other capital gains in assets like stocks.

Support for margin trading is also included.

Check out Tokentax

Cryptotrader

Cryptotrader

CryptoTrader.Tax takes away the pain of preparing your bitcoin and crypto taxes. Simply connect your exchanges, import trades, and download your tax report in minutes.

Check out Cryptotrader

Accointing

Accointing-header

Accointing is a Crypto Portfolio Management platform for all your needs. It keeps track of all the current active crypto markets and provides insights into your existing investments. This platform serves as an all-in-one solution to organize all your data in one place.

You are presented with a user-friendly dashboard that supports over 300 wallets and exchanges and up to 7,500 currencies, making Accointing one of the biggest transaction data aggregators in one platform.

It allows you to track all your transactions and performance in real-time and easily manage your taxes as well. The platform offers tax reports that comply with global tax regulations. You can choose to see a minimalist overview of your investments or do a deep dive into a specific coin or market.

Accointing lets you analyze your portfolio by viewing all your gains and losses and your historical data automatically without any maintenance. Once you connect it to any of the supported exchanges, it will automatically update your portfolio accordingly; additionally, you also have access to export or print these reports.

Accointing-10%

Get 10% off Accointing now

Kubera

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. In fact, Kubera is a more holistic tracker than the above platforms in that apart from automatically tracking your crypto position and NFT holdings, it also captures your bank and brokerage accounts, real estate, vehicles, domains and metals. Kubera also allows you to manually input any other assets you own so that you can obtain a comprehensive view of your net worth in real-time.

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.).

See also: My detailed review of Kubera

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. 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.

Check out Kubera

How to Easily Prepare Your Crypto Taxes

So you’ve fallen down the crypto rabbit hole, started buying and selling some Bitcoin, then bought some Ether, and perhaps even ventured further to buy some other altcoins.

After some time, seeing that you’re profiting massively, you decide to sell some of your tokens. Sometime later, you decide to buy a new token that you believe will revolutionize the world.

The problem is, of course, keeping track of all these purchases and sales. You want to keep track of whether you’re actually turning a profit or not, plus you need to calculate what you owe your country’s taxman at the end of the year.

Crypto taxes are a complex topic, but I’ve done my best to summarise the situation in several major countries, so check out my post on how Bitcoin and other cryptos are taxed around the world.

So what are your options for crypto tax preparation?

You could keep track of things manually using a tool like Excel, but this quickly gets out of hand, especially if you’re trading on multiple platforms or have multiple wallets.

The better solution is to use an online crypto tax preparation tool.

All the tools mentioned in this post can help you in preparing your taxes apart from acting as a handy crypto portfolio.

If you’re preparing your crypto taxes for the first time, I would suggest you check out my favorite portfolio/tax preparation tools:

  • CoinTracker
  • CoinTracking
  • Koinly

Depending on what your needs are, what jurisdiction you’re in, and what your budget is, you can choose one of those platforms. All three of them are excellent and run by serious people, so you cannot go wrong.

What’s your favorite crypto tax preparation tool?

Filed under: Cryptoassets, Money, Top Post

The Best Crypto Resources

Last updated: May 11, 202316 Comments

Here’s a collection of my favorite resources from the world of Bitcoin, cryptocurrency, tokens and blockchains.

If you’re new to the world of crypto and you’re feeling overwhelmed, I’ll start out with a section that’s just for you.

Books

  • See my dedicated post about the best Bitcoin and crypto books

Binance Research

Courses

  • Saylor Academy Bitcoin for Everybody

Crypto Twitter

  • My Crypto list

Crypto Prices and Exchange Liquidity

  • Coinmarketcap

Exchanges

  • Binance
  • Bitpanda
  • Kraken
  • Localbitcoins
  • Comparison of many platforms

Leveraged Trading Platforms

  • Bitfinex
  • Bitmex
  • Exmo
  • CEX

Decentralized Exchanges

  • Uniswap
  • 0X
  • Bisq

Crypto Borrowing & Lending

  • Nexo
  • YouHodler

See my post on the best crypto interest accounts and lending platforms.

Important Websites

  • Bitcoin.org
  • Ethereum Project
  • Nakamoto Institute

Ethereum

  • Gas Prices

Lightning Network

  • Lightning Network official page
  • Breez
  • Lightning Labs
  • Lightning information

Crypto News & Blogs

  • Cryptoheadlines – Crypto news aggregator
  • Dailycoin – Your daily crypto guide
  • Coinmarketcal

Resource Websites

  • The Case for Bitcoin
  • Keepitsimple Bitcoin
  • UpFolio’s Crypto Guides

Inheritance

  • Crypto inheritance guides

Cryptocurrency Hedge and VC Funds

  • 1confirmation
  • A16z
  • Alameda Research
  • Arrington XRP Capital
  • Binance Labs
  • Bitwise index fund
  • Blockchain Capital
  • BoostVC
  • CMS Holdings
  • Coinbase Ventures
  • Coinfund
  • DeFiance Capital
  • Digital Currency Group
  • Dragonfly Capital
  • Electric Capital
  • Fabric Ventures
  • Framework Ventures
  • Fenbushi Capital
  • Galaxy Digital
  • Grayscale
  • Hashkey Capital
  • Huobi Capital/Exchange
  • Kinetic Capital
  • LedgerPrime Capital
  • Multicoin Capital
  • Pantera Capital
  • ParaFi Capital
  • Paradigm
  • Placeholder Ventures
  • Polychain Capital
  • Three Arrows Capital
  • Union Square Ventures
  • Winklevoss Capital
  • Crypto fund costs

Crypto Tax Calculators

  • Cointracker
  • Cryptotrader
  • Cointracking
  • Koinly

Also, read my article about the best crypto tax software solutions.

Tools

  • Mnemonic code converter
  • Pi Hole network wide ad blocking

Crypto Custodians

  • BitGo Custody
  • Gemini Custody
  • Bitcoin Suisse Vault
  • Coinbase Custody
  • Fidelity Custody
  • Bakkt
  • itBit
  • Knox Custody
  • Onchain Custodian
  • Copper
  • Unchained Capital (collaborative custody)
  • Casa (collaborative custody) – see docs too
  • Sygnum Bank

You can also check the custodian comparison site for further options.

Crypto-Friendly Banks in Europe

  • Read my dedicated article about crypto-friendly banks.

News Sites (Spanish)

  • El Bitcoin

Newsletters

  • Bravenewcoin
  • Cryptocompare

Consultancy

  • Jakub from Finematics
  • Ministry of Nodes

Run Your Own Node

  • Umbrel
  • RaspiBlitz
  • RoninDojo
  • MyNode
  • Feature Comparison

Inheritance Solutions

  • Casa Inheritance

APIs

  • Nomics
  • Whale Alert

Wallets

  • Mobile wallet – Exodus
  • Mobile wallet – Argent (for DeFi)
  • Mobile wallet – MyCelium (Android)
  • Hardware wallet – Ledger Nano X
  • Hardware wallet – Trezor Model T
  • Wallet Scrutiny
  • Castle – wallet for NFTs
  • Gnosis Safe – Ethereum multisig wallet

Read my article about hot wallets too.

The Software wallet comparison compiled by Veriphi is a very good additional resource if you’re not sure what to go for.

Price Alerts

  • TargetMoon (10 free alerts)
  • Coindera (free for email alert, paid for SMS alerts)
  • Coinmarketalert
  • Coinwink
  • Cryptoloom

Earn Bitcoin

  • Microlancer

Bitcoin Art

  • Lucho Poletti

Stats and Analytics

 

  • Lunarcrash
  • Dune Analytics
  • Glassnode
  • Nansen
  • Cryptoquant
  • Tokenterminal
  • Intotheblock
  • Santiment
  • Clarkmoody’s dashboard
  • Mempool space
  • Mempool observer
  • Bytetree Terminal
  • Currencies used to trade Bitcoin
  • Barchart Crypto
  • Bitinfocharts Crypto
  • Defi pulse
  • Coin.dance
  • Bitcoin treasuries – Bitcoin treasuries in public companies
  • Statoshi – node stats
  • Howmanyconfs

Block Explorers

  • Blockstream
  • OXT
  • KYCP
  • Sochain

Accepting Bitcoin Payments

  • BTCPay
  • Bitpay
  • GoCrypto

Debit Cards

  • See my article on crypto debit cards

Charts

  • Bitcoinvisuals – many Bitcoin charts under one roof – especially technical related.
  • Moonstats
  • Cryptowatch
  • Bitcoincharts
  • Tradingview
  • Tradinglite
  • Metatrader

Bitcoin ATMs

  • FindBitcoinATM

Domain Registrars

  • Unstoppable domains
  • Ethereum Name Service

Trading Courses

  • Technical Analysis for Cryptocurrencies
  • Entries and Exits

Podcasts

  • What Bitcoin Did
  • The Pomp
  • Stephan Livera Podcast
  • The Flippening
  • Unchained
  • The Breakdown
  • Base Layer
  • The Delphi Podcast
  • Untold Stories
  • Epicenter
  • The Bitcoin Game
  • Bitcoin Knowledge Podcast
  • The Gift of Bitcoin – excellent for beginners

YouTube Channels

  • Andreas Antonopoulos – Fundamentals and Technical
  • DataDash – Trading
  • Technical Roundup – Trading
  • Off Chain with Jimmy Song – Bitcoin

Research

  • The Block Crypto
  • Arcane Research
  • Delphi Digital
  • Bitwise Investments
  • Consensys

DeFi

  • Fast DeFi tutorial
  • Bankless
  • DeFi Pulse
  • DeFi Rate
  • DeFi Dad
  • The Daily Gwei
  • DeFi Weekly
  • The Defiant
  • Pools.fyi – Top Liquidity Pools
  • DAPP Radar

DeFi Aggregators

  • Zerion
  • Matcha
  • Harvest
  • Zapper

Trading Bots and Automation

  • Coinrule
  • Shrimpy
  • 3Commas
  • Cryptohopper
  • Tradesanta

Also, see my dedicated article on crypto trading automation bots.

Crypto Jobs

  • Bitcoiner Jobs

Forums

  • BitcoinTalk
  • Reddit
  • Forobits (Spanish)

Deals

  • Bitcoinblackfriday

Bitcoin-only sites

  • Bitcoin Q n A
  • Keep it Simple Bitcoin
  • Casebitcoin
  • 10 hours of Bitcoin
  • Bitcoin Only
  • Bitcoiner Guide
  • Bitcoinwallet guide
  • Bitcoin node guide
  • Bitcoin intro
  • Bitcoin optech
  • Bitcoin devlist
  • 21ism – bitcoin inspired creativity
  • Lopp’s bitcoin information and resources
  • 10X security guide
  • Wallets recovery

Telegram Groups

  • No Bullshit Bitcoin

More Resource Lists

  • Bitcoin Only
  • Jameson Lopp’s list
  • GitHub List

Any other resources I forgot to mention?

Filed under: Cryptoassets, Money

Is Bitcoin a Bubble, a Fraud, or a Scam?

Last updated: September 15, 20224 Comments

Article written in 2017 during the Bitcoin bull run.

As the world of cryptocurrency continues to heat up, several investment experts are starting to question the rise of cryptos, and some have gone as far as predicting that we will soon see the greatest financial crash in history.

The argument usually starts by saying that the crypto world is purely speculative, and that’s why most of the institutional investors have so far preferred to stay out of the game. Cryptos are then compared to tulip mania, the Nikkei’s crash and the dotcom bubble of the late 90s. Here’s a quote from the article I linked above that sums up the argument being presented by this bearish point of view:

Some have likened the cryptocurrency market to the Internet sector in 1999. While there was little doubt then, and clear evidence since, that those companies would take over the planet, the two Nasdaq indices fell an average of 90% in the 30 months ending 2002. This time, the bitcoin mania, which has dwarfed even the Tulip Bulb lunacy, should become the posterchild graduate school case study for not only finance, but also psychology, sociology, and perhaps other disciplines. Ironically, for lacking discipline!

I feel that it is good to think about how different scenarios could play out, and to try to adopt both a positive and negative outlook on things when investing, and then compare which side’s arguments make most sense. To sort out this conundrum, I asked my friend Marcel Ellis, who is a crypto expert and runs a few courses over at MoneyZoo.org.

Here’s what he had to say about the argument:

1) To compare Bitcoin to the Tulip Mania is silly.

2) Comparing the entire Cryptocurrency eco system to the dot com bubble is a much better analysis and I will discuss why and how parts of the article are relevant and others not.

The dot com bubble allowed for virtually any unknown to create IPOs to raise funds for whatever reason without any normal consideration of profitability or due diligence. We have a similar, if not worse, scenario today with ICOs which are endangering the entire crypto ecosystem – and I have been warning for 2 months about these ICOs.

Many companies during the dot com bubble were debt ridden with staff and investors living an overly lavish life. Giveaways of millions of dollars worth of prize money for contests were offered – which of course was silly considering the amount of debt they had. We don’t have this scenario with cryptos, at least that I am aware of.

3) Mass hysteria. Big yes and this worries me. While it is always nice to see gains, I know deep down that when there are huge rallies there will be huge dips of an almost equal proportion. Take NEO for example. Why has it spiked to $22 at the time of writing when just a few days ago it was $7. Something is wrong and in the crypto world, knowing what is organic growth, what is FUD and what is FOMO is even more critical than is the stock world.

Is Bitcoin in a bubble? Bitcoin has been in a bubble since the day it was born just like any other asset with perceived value like gold, or just like any asset with manipulated value like diamonds. Bitcoin can be compared fairly to both gold and diamonds as it has characteristics of both.

I think a more important question is to ask if the entire cryptocurrency ecosystem is in a bubble, and here I would venture to say YES to many of the cryptos and that YES they will bring the price of Bitcoin tumbling down for a while. This is a much-needed thing and will clean up the market for it to mature in much the same way the dot com bubble cleaned up the net with winners like eBay and Amazon eventually having larger valuations than pre bubble.

My outlook long term remains Bullish for Bitcoin and a few other coins but I am very bearish on around 98% of the crypto world.

I agree with Marcel’s point of view. While one can never predict the future, and there is indeed the possibility of a big crash that will wipe out the huge gains in Bitcoin’s value over the years, there is a lot of real value in this technology that surely can’t be considered worthless. We are still in the very early days both in terms of the technology and its applications and also in terms of adoption rates.

There have been various bullish predictions that counteract negative view on the future of cryptos, including a recent claim by a Harvard academic that Bitcoin’s price could hit $100,000 by 2021. At finance conferences this year, the vast majority of people I spoke to agreed that the goal for Bitcoin in 2018 is $10,000.

In a similar vein, I was following a discussion in Malta’s Bitcoin group on Facebook. The main point being discussed was whether Bitcoin is one huge bubble similar to the Tulip mania craze in the 17th century Netherlands. Given the articles we see in the media, this is a valid question to pose. One commenter, Jonathan Galea, left a comment that I thought was very well written and worth sharing on my blog, with his permission of course.

Here’s the comment from the Bitcoin Malta group.

FACT: the tulip bubble centred on a product which has no inherent value apart from being a plant. The right cryptocurrencies have inherent value which solve real-world problems.

FACT: therefore, the “crypto-bubble” should be likened to the dotcom bubble and not the tulip bubble. That’s your first mistake

FACT: the dotcom bubble peaked at 3 TRILLION dollars. Trillion with a T. The current total crypto market is worth $110 billion, with a small b. You can do the maths. Keep in mind that the dotcom bubble was reached at a time when social media and global connections were not the norm… and inflation has had its way since then too.

FACT: the institutional investors haven’t entered the playground yet. What you’re seeing are just BTC whales trapped in the crypto-ecosystem since there’s no regulation in place through which they can legitimately cash out their earnings. Either that, or they know that the bubble has not yet formed and there’s plenty of money to be made. Either way, they have purchasing power worth millions. A small BTC whale can easily invest 800 BTC.

FACT: Buying altcoins for normal people is still a laborious process. The people I’ve had to explain it to are normally-versed in tech and they still found it difficult without guidance. Until and unless crypto investments are easily accessible as least to the tech-savvy, then one can’t talk about a bubble yet. Once ETFs come into play, then we’ll see signs of a bubble forming.

FACT: 2018 will be the year when crypto-projects start coming into fruition and offering versions of their product to widespread use. Those who don’t deliver will die, the others will grow… fast.

FACT: At the height of the dotcom bubble, the average person on the street was talking about it. I dare you to randomly find at least 5 people out of 10 who can give you a satisfactory definition of Bitcoin if you were to conduct a survey in Valletta. It’s still nowhere near being mainstream; and if Bitcoin isn’t, let along the hundreds of other altcoins out there which are even more promising that Bitcoin.

FACT: Mainstream media were screaming bubble back in 2013 when BTC’s price hit $1200. It screamed it again when BTC’s price hit $1300 at the start of this year. Are you starting to see a pattern?

Are Cryptocurrencies a fraud and a scam?

Many have pronounced Bitcoin dead over the years, while others have said that it’s a scam or a fraud. Jamie Dimon, CEO of JPMorgan, famously also took aim at bitcoin, calling the cryptocurrency “a fraud” and “worse than tulip bulbs.”

Understandably, this came as a bit of a shock to the lay people who don’t really understand the fundamentals of Bitcoin and cryptocurrencies. As I said, this is by no means the first time that someone has pronounced Bitcoin dead or denounced cryptocurrencies, but unfortunately, statements from such prominent people always make the news.

Let’s be clear, Dimon’s firm is one of the chief architects of the global financial crisis that led to the interest in a somewhat arcane cryptocurrency in the first place. There would be no bitcoin without Jamie Dimon — and in some ways he’s right to fear its rise.

As a Vanity Fair piece revealed, JPMorgan Chase paid out $13 billion (with a “b”) to the U.S. government because of its role in the financial crisis and the mortgage security fiasco that almost destroyed the U.S. economy.

This goes to show that you need to be very careful where you’re getting your news and information from. There’s a lot of purely ridiculous stuff out there, especially in new spaces such as cryptocurrencies.

It is normal and actually recommended to approach Bitcoin and other cryptocurrencies with a criticial mind. They are obviously highly speculative investments and have no intrinsic value. However, they are also a whole new type of asset. To try and compare them to tulip bulbs is just naive, as I discussed in a previous post. There is really no direct comparison to Bitcoin and cryptos throughout history, and that is what makes it so exciting.

Unlike fiat currency, Bitcoin is fully transparent and controlled. We know exactly how many Bitcoins will exist in 5, 10 or 50 years. If you take a look at history and the ways that fiat currency has been manipulated and how many people’s lives were instantly ruined during periods of hyperinflation, amongst other government triggered actions, you would be hard-pressed to name Bitcoin as a fraud and not fiat currencies.

Filed under: Cryptoassets, Money

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