Doing the Work...
...Even When It Gets Tough
On my long run this morning (Ironman training has begun!), which started at daybreak, I made a mental note of just how few other runners were out there braving the cold.
There weren’t many. And I liked it that way.
I like to zig while others are zagging and to put in the hard work when others lose interest.
How I felt during the run mirrored how I feel both investing in digital assets and working in the crypto industry right now.
Sure, we’ve had a little bump in prices of digital assets — which I’ll get to in a moment — but, for the most part, the crypto market is still pretty cold and search volume for digital assets and crypto-related products is low.
And I think it might remain this way for about another 2-3 months.
But putting in the work to both educate yourself about this asset class and to make smart investments in the space while prices are low is similar to working on your physical fitness while everyone else is tucked into their warm beds on a cold Sunday morning.
If you’re still doing the hard work even now when it’s unpopular, difficult and sometimes downright boring, good on you; it’ll likely pay off in the middle-to-long term.
The State of Crypto Markets
I shared the following commentary with The Street on behalf of Finder this week.
Frank Corva, senior analyst for digital assets at Finder, said that in the last three weeks, the price of Bitcoin has risen from just under $17,000 to just over $23,000, while the price of Ether has experienced a similar rally, "rocketing from just under $1,200 to almost $1,700 in the same time frame."
"These notable price moves beg the question: Is this the start of a longer crypto bull market or are we in the throes of a bull trap?" he said. "What happens next may depend on the severity of The Fed’s next interest rate hike, which is scheduled to be announced on Feb 1."
Corva said that while markets seemed to be pricing in a 25 bps rate hike about a week ago, some notable economists have begun predicting a 50 bps rate hike as of the last few days.
He added that if the Fed only hikes 25 bps, the prices of many risk-on assets – including crypto – will likely continue in their uptrend, but if the Fed hikes 50 bps, the prices of risk-on assets will likely trend lower.
"Looking at the crypto market through a more micro lens, some of the anxiety around the Gemini Earn product has subsided," Corva said. "Crypto markets were unperturbed last week when Genesis – the company to which Gemini outsourced the facilitation of its Earn program –filed for Chapter 11 bankruptcy protection."
Traditional Financial Companies Ease Up on Crypto
This may be some indication that crypto investors are starting to recover from the PTSD they felt in the wake of FTX’s implosion, but Corva said that if 2022 taught crypto investors anything, "it’s that we never know where and when the next blow up might occur, and we don’t know if we’ve yet seen all of the fallout from the collapse of FTX."
"So, even if we are in the early stages of a crypto bull market, investors may still want to proceed with caution," he said.
You can read the full piece at the following link: “Crypto Price Check: Analysts Say ‘Proceed with Caution’”
Bitcoin (BTC) Price Predictions
I also published the following piece for Finder: “Bitcoin (BTC) price prediction 2023”
While I’m not a huge fan of price prediction articles (because they very rarely tend to be all that accurate), I did enjoy putting this report together.
The data from the report comes from a survey that Finder conducts in which a panel of 56 fintech and crypto specialists offer their thoughts on how BTC will perform throughout the next decade, and I especially liked including and framing some of the commentary that the specialists offered.
And I was honored when I found out that both the report and some of the commentary I chose to include in it was cited in the following piece for Forbes Digital Assets: “Huge $3 Trillion Bitcoin Price Prediction Comes with a Stark 2023 Warning”
Learn to Do “This”
I also had a piece published on behalf of Finder via MediaFeed and MSN this week entitled “Thinking of buying the crypto dip? Do this first”
What’s “this” you ask? Good question. I guess you’ll have to read it to find out.
Spotlight on Kenya
I learned a lot about money this week from two Kenyans who are very good at teaching the world about it.
The first is Rufas Kamau, lead Markets Analyst at FXPesa and freelance writer for a number of publications including Forbes.
If you are looking to learn more the type of fiat monetary debasement that’s happening in many developing countries (I don’t like this term, but it’s leaps and bounds better than “Third World”), I highly suggest you read the following piece: “Why is the Kenya shilling losing against US dollar?” (Business Daily Africa)
Here’s the intro to it:
“Since the beginning of 2020, the Kenya shilling has lost approximately 25 percent of its value against the US dollar, falling from Sh99 to Sh124.
This means that Kenyans will need to spend 25 percent more shillings to buy the same amount of dollars.
Importers have had to pay an extra 25 percent and have repriced their items, raising the cost of consumer goods and contributing to higher inflation in Kenya.
Exporters, on the other hand, are receiving more shillings for the same quantity of exports, and their products appear to the rest of the world to be cheaper.”
The second Kenyan I learned from this week was Noelyne Sumba, who was the guest in the following interview on The Bitcoin Layer:
Ms. Sumba also discussed the recent devaluation of the Kenya shilling as well as financial and economic corruption in Africa as it pertains to foreign aid.
(If you’d like to learn more about foreign aid-related corruption in Africa, I highly suggest the following book: The Road to Hell: The Ravaging Effects of Foreign Aid and International Charity, by Michael Maren.)
Ms. Sumba translated Layered Money: From Gold and Dollars to Bitcoin and Central Bank Digital Currencies, written by the founder of The Bitcoin Layer, Nik Bhatia (who I’ll be (re-)interviewing for Finder in April!) from English to Swahili.
And she is currently the director of Machankura, an insanely cool project that allows residents of eight different African countries (and counting) to send BTC from any mobile device — including old school phones that look like the one below.
Central Bankers Upset about What They Did to Themselves
The article linked in the tweet below is one of two that I’ve seen/read lately that discuss how employees of central banks want raises so that they can keep up with inflation.
Here’s a link to the article: “Global Central Banks Preaching on Pay Are Enforcing Squeeze Too”
The irony here, of course, is absolutely astounding.
The people who played such a large role in creating the inflation problem we’re currently facing are feeling the pain of inflation.
Now, they’re on the verge of protesting and want wage hikes.
If there’s any justice in the world, they won’t get wage increases. Instead, hopefully, many of them will have to take on an extra job to make ends meet.
This would have two beneficial effects:
It reduces the amount of money we pour into bureaucracies that have failed us and
It gives these bureaucrats a taste of the financial hardship they’ve caused for millions — if not billions — around the globe, which would, in a perfect world, provide some impetus for them to change their policy.
(Yes, I know that they’ll probably just get their wage increases and that they’ll face little to no consequences for their actions.)
Quote of the Week
“Bitcoin loves QE and it hates QT” -Travis Kling, on What Bitcoin Did
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And that’s all ladies and gents!
I hope you all have a great week, and I hope you all keep pursuing whatever goals you’re after — financial or otherwise — even when the going gets tough, unpopular or boring.
Best,
Frank
Twitter: @frankcorva
Currently reading: Never Finished, by David Goggins
