Weekly Market Overview
The market is in the green significantly up on where we were seven days ago, with Bitcoin around $42,000 USD and Ethereum just a touch under $3000. But like last week, we are still just bouncing off the bottom of the range and bouncing off the top. Ethereum got a mention on the front page of Bloomberg today. Bloomberg’s price target for the year is $6,100, which is roughly double where we are today, and they’re picking that Ethereum might probably outperform Bitcoin. That’s likely to drive a lot of interest in Ethereum, which is still king of the hill in the smart contract platform space and is huge for defi and NFT's.
Australia is open for Blockchain Business
Blockchain Week 2022 is on in Australia. Senator Andrew Bragg opened the conference with a legislative proposal he hopes will lay the groundwork for a new digital asset ecosystem down under. He says that were we to apply existing tax laws to the digital assets ecosystem, the sector would be suffocated, so we need tax reform. It’s a once-in-a-generation opportunity to clean out regulatory settings, which is positive for established companies like Dacxi who welcome a better and more clearly regulated crypto environment.
Goldman Sachs enters the crypto retail trade
Goldman Sachs who are one of the world’s leading non-government financial institutions has conducted their first over the counter crypto trade with Galaxy digital. It's the first OTC crypto transaction by a major bank in the US, and as we know where Goldman goes the rest of Wall Street follows. Another example of this same warming up to crypto by Wall Street is Ray Dalio, one of the great investor minds of his generation. Like Goldman Sachs, he has been skeptical of Bitcoin and crypto in the past. But that is changing. His mega hedge fund Bridgewater is now looking to invest in crypto. Dalio recently said he owned some Bitcoin and would rather have Bitcoin than a bond in inflationary times.
The Kurtzweil Singularity and the Exponential Age
Ray Kurtzweil developed the Law of Accelerating Returns, which predicts an exponential increase in technologies such as computers, genetics, nanotech, robotics, and artificial intelligence. He theorized that all these different technologies intersect and compound on each other meaning we get exponential growth across different technological paradigms. Because exponential growth happens so fast life becomes unpredictable very quickly too.
The Kurzweil Singularity is a hypothetical point at a time at which technological growth becomes uncontrollable, and, and irreversible, resulting in unforeseeable changes to human civilization. We will eventually hit a point where artificial intelligence enters a runaway self-improvement cycle, with each new and more intelligent generation appearing more and more rapidly, causing an explosion in intelligence and resulting in a powerful superintelligence that far surpasses all human intelligence - the premise of the Terminator movies.
Future Shock is Here Now
It might seem far-fetched but exponential growth is already here in the way that computer chips get faster, iPhones get more powerful, social networks like Facebook, Tik Tok acquire more users. I think we're starting to see the same now with Bitcoin and Ethereum.
This constantly accelerating state has been predicted for a while now. In the late 70s, Alvin Toffler wrote Future Shock, which he says is a psychological state that humans and societies can be vulnerable to when there is too much change happening in too short a period of time. Which I think describes the world we live in today, with social media, the metaverse, new technologies and information overload. By the time our children are adults is just going to be exponentially different from the one that you and I grew up in.
Elon and Co
In terms of crypto, it’s interesting to see what the CEOs and founders of big-name firms, global brands, and hedge funds are saying. Elon Musk is just one of the people who are regularly talking about crypto and its future. I think that proves the potential for more exponential changes in our technology paradigms, our financial systems, the way we live, web3, Metaverse, etc etc. If the heads of these global companies are getting into crypto that's a very powerful signal.
Another influential crypto commentator Will Clement says if you don't own Bitcoin at this point, you're essentially ‘short’ Bitcoin. What that means is if you're electing not to own any bitcoin or crypto, then you're betting that crypto is going to fail. But what if you're wrong? It reminds me of a quote “there isn’t enough Bitcoin for every millionaire in the world to own a single one.” There will only ever be 21 million Bitcoin, but there are 56 million millionaires in the world today. It means that if every single millionaire in the world wanted to own just one Bitcoin, there wouldn’t be enough to go around. Bitcoin is the only truly scarce digital asset in the world. So if all those millionaires wake up one day and say ‘I want to own one Bitcoin or 10 Bitcoin,’ that's when we go exponential.
The End of the US Dollar?
Arthur Hays has just posted an interesting piece on Medium called ‘Energy Cancelled.’ He thinks there is a financial crisis coming and hundreds of billions of dollars will flow into gold and Bitcoin over the next decade. Nations will look to gold and other storable commodities instead of owning US dollars. He says that there's no reason why gold won't go to $10,000 and Bitcoin to $1 million. A million-dollar Bitcoin is bullish by anyone's standards, but it just brings us back to the idea of exponential growth, and exponential returns.
The Chessboard Analogy
The human brain is not wired to understand how exponential growth works. But a good way of understanding it is the Chessboard Analogy. If a chessboard were to have a grain of rice placed on each square, so that one grain was placed on the first square, two on the second, four on the third, and so on, doubling the number of grains or pieces of rice on each square? How many pieces of rice would be on the chessboard at the finish? Because of exponential growth the total number of grains on the last square would be 18 quintillions, 446 quadrillions 744,073,709,551,615, or over 1.4 trillion metric tonnes of rice.
It means that the million-dollar Bitcoin is closer than you think. That's why you might consider buying a bit of Bitcoin and stashing it away for the long term. Get that long-term Dacxi wealth-builder mindset and ignore the short-term volatility.
Check out the full story of this week’s Crypto Wealth Cafe at Dacxi’s Youtube Channel. And don’t forget to share it and this blog with your friends.
See you next week.
The information provided in this document does not constitute investment advice, financial advice, trading advice or any other sort of advice and you should not treat any of this document’s content as such. You should carefully consider whether trading or holding cryptocurrencies is suitable for you relative to your financial position. The price of cryptocurrency can go down as well as up and past performance is not a guide to future performance. Investors may not get back the full amount originally invested. The information in this document is believed to be reliable. Dacxi has taken reasonable care to ensure the information stated is accurate. However, Dacxi makes no representation, guarantee or warranty that it is wholly accurate and complete. Do conduct your own due diligence and consult your financial adviser before making any investment decision.