Many financial experts see cryptocurrencies like Bitcoin and Ethereum as this decade's must-have investment, and the blockchain technology powering the crypto market is poised to transform the financial world. What should the average investor know to keep up with these trends and maximize their potential?
To get answers, Breitbart News Editor-in-Chief Alex Marlow spoke again with crypto investment expert Teeka Tiwari, whose PickoftheDecade.com presentation and Palm Beach Letter provide investors with the tools they need to navigate this new asset class.
In his discussions with Breitbart News, Tiwari explained these nine facts about crypto and the blockchain that every informed investor should know.
1. Bitcoin is inflation proof.
Cryptocurrencies like Bitcoin are the perfect check against the inflationary policies of politicians and the reckless money-printing of central banks, which dilute the value of currency.
“For the first time, we have a monetary system in Bitcoin that nobody can violate,” Tiwari said. “No matter what happens, they'll only ever be 21 million coins.” Because of this, Bitcoin is a direct competitor to the central banks.
“Central banks can print money as much as they want, [and] they can dilute the dollars down,” Tiwari told Breitbart News. “But if Bitcoin becomes what I believe it will be — essentially, an alternative source of value that people can flee to when their countries are debasing their currency — then it now becomes a direct competitor to central banks.”
2. Cryptocurrencies like Bitcoin and Ethereum rely on blockchain technology that is decentralized, transparent, and virtually un-hackable.
Cryptocurrencies like Bitcoin and Ethereum could not exist without the blockchain, which Tiwari describes as “a computer code that can verify transactions in a way that is not hackable.”
“The blockchain is designed in a way to make it tamper proof. It's a way to store data,” he said. “When something is on a blockchain, no one can go back and change the data the way they can in a centralized computer system.”
In the world of cryptocurrencies, the blockchain functions like a highly secure digital ledger which allows users to confirm exactly how much cryptocurrency each person owns because each transaction is verified by thousands of independent computers in a decentralized network.
This innovative decentralized consensus mechanism makes blockchain technology both transparent and fraud-proof, because if anyone wants to add new data to this digital ledger, a majority of the users (or miners) have to agree that the data is accurate.
For example, in a typical crypto transaction, if you want to send Bitcoin to another person, the blockchain must verify that you have the Bitcoins to send. In a centralized computer system, a hacker could try to corrupt the network into thinking he had more Bitcoins than he does. But it's impossible to hack the blockchain in this manner because it is decentralized across thousands of computers. For any transaction to take place, a majority of these decentralized computers must agree that the transaction is legitimate.
This decentralized fraud-proof transparency is what makes blockchain technology so innovative and revolutionary, Tiwari said.
3. Bitcoin and Ethereum are the largest and most secure blockchains.
“Not all blockchains are created equal. Some are less secure than others,” Tiwari explained. “The Bitcoin blockchain is virtually un-hackable because of the cost it would take to try to assault the Bitcoin blockchain.”
Not only would such an assault take untold billions of dollars, but it would require more computer hardware than any hacker could muster. “The actual cost to try to attack the network is so prohibitive that it doesn't make sense to even attempt to do it,” he said. “And the amount of power that you would need to try to rewrite the Bitcoin blockchain doesn't even exist in one location.”
As subscribers of Tiwari's Palm Beach Letter know, the Bitcoin and Ethereum blockchains are the strongest because they have the largest number of miners whose work secures the network and stores its data. Miners update the Bitcoin blockchain every 10 minutes and the Ethereum blockchain every 15 seconds.
The key factors in determining a blockchain's strengths are the number of miners securing it, the amount of computing power maintaining it, and whether the cost to attack these networks is too prohibitively high to be profitable, Tiwari explained.
4. The key metric to determine a cryptocurrency's value is its usage.
Picking the right crypto investment can be confusing, but Tiwari's Palm Beach Letter has a proven track record of identifying the most profitable cryptocurrency investments. Tiwari does the research for his subscribers by focusing on the key metrics.
“You have to do an enormous amount of research – especially when you're looking at new projects to determine whether this thing really has value,” Tiwari said. “The one thing that I look at more than anything – and this is the one metric that drives the most amount of value in a project – and that's usage. Is the usage going up? Or is the usage going down? If the usage is going down, it's not a great project. It is usage that drives the coin's value.”
5. Most non-fungible tokens (NFTs) will likely lose money.
There is a lot of hype surround non-fungible tokens or NFTs. But Tiwari warns his Palm Beach Letter subscribers to be wary of NFTs.
“I would say that with NFTs, 98 percent of them will lose money,” Tiwari said. “This reminds me of the ICO boom (the initial coin offering boom) in 2017. [Back] then I was even harsher. I said 99 percent of them would lose money. And they did.”
“That doesn't mean that during a mania stage there isn't money to be made in NFTs, and believe me, we are in a mania stage,” he added. “Now in terms of the underlying tack of what an NFT is, which is essentially a provable digital collectible, yeah, there's definitely value there. There's no question. Are we seeing the best use of that technology right now? Probably not. And I would say that if folks want to mess around with NFTs, have fun with it. Consider it Vegas money. But don't put Johnny's college fund in it.”
6. The biggest mistake a Bitcoin investor could make is to spend their Bitcoin.
Unlike other currency, cryptocurrencies like Bitcoin and Ethereum should be held as long-term assets.
“It will be the biggest mistake of your life to spend your Bitcoin,” Tiwari said. “That would be like spending your Coca Cola stock in 1950. Don't do it!”
“Back in 2016, I bought a hardware wallet which cost me one Bitcoin, which at the time was 400 bucks. Well, that was a $60,000 mistake!” he joked. “So, I would say please do not spend your Bitcoin. Do not spend your Ethereum. Sit on it, hold it, and I think it will be one of the greatest investments you've ever, ever had in your life.”
7. Digital wallets that store Bitcoin and other cryptocurrencies will soon be a regular feature in of our lives.
We can expect the mass adoption of digital wallets, as more people gravitate to Bitcoin as an inflation-proof asset.
“Think of a digital wallet like a web browser,” Tiwari said. “The way that we interact with the internet is through a web browser, which is a piece of software that is designed to connect to a web server and serve information to us. So, a digital wallet is the same thing except it's built to interact with blockchains.”
“Your Bitcoin is held on all these collections of servers that are part of the Bitcoin network. What your wallet does is it gives you the ability to interact with the Bitcoin blockchain,” he explained. “It allows you to send commands to the blockchain network, so you can move your Bitcoin.”
Tiwari believes that within three years Amazon, Google, and Apple will offer Bitcoin wallets on their devices.
8. Blockchain-based decentralized finance projects have grown into a $100 billion business that is changing traditional banking.
The possible future applications of blockchain technology are nearly limitless, which is why the financial world is now fully engaged with this innovation, as Tiwari's PickoftheDecade.com presentation explains. Among the innovations are various decentralized finance – or DeFi – projects.
“There's an application of blockchain technology called decentralized finance,” Tiwari said. “And this went from zero to being a $100 billion business in less than two years. The growth has been incredible. And what we've seen is really smart projects figure out new ways of using blockchain.”
What's more, we can expect to see more of these applications “eating into different areas of traditional banking,” he explained.
As Tiwari explains in his Palm Beach Letter, the most innovative blockchain is the Ethereum blockchain because it was designed to allow other DeFi projects to build off it for real-world applications.
For example, blockchain technology can be used to verify quality control at each step of a product's supply chain in a way that can't be faked or retroactively edited. In essence, the blockchain creates an “immutable record” to prove that what was supposed to happen along a supply chain did happen.
9. Like the internet, the blockchain will become an integral part of our lives.
“The blockchain is going to continue to find its way into different areas of our lives the way the internet did in 1995,” he said.
Tiwari mused that a person in 1995 might have thought that the internet would have no bearing on their life. But now in 2021, the internet is intertwined with every aspect of our lives.
“You can't escape the internet. The same will be true of blockchain – except the adoption of blockchain will be much faster. It won't take 25 years,” he said.
He believes the ubiquity of mobile smart phones, which is “the equivalent of a supercomputer based upon what we had 40 years ago,” will “accelerate tech adoption” of the blockchain – with every smart phone user having a digital wallet and various blockchain-based applications on it.
“The adoption [of blockchain applications] is going to happen much, much faster than what happened with the internet – because with the internet, we had to build the whole infrastructure that never existed before,” he said. “Now we have an infrastructure to piggyback off, which is why I call this the trade of the decade.”
Anyone interested in learning more about this revolution in finance – and how to maximize your benefit from it – should watch Tiwari's PickoftheDecade.com presentation.
“Over the next 10 years, I think the value creation will be astronomical,” Tiwari said. Subscribers to the Palm Beach Letter can get ongoing information on how to harness this potential.