Watershed moment for Bitcoin
The country of El Salvador made the bitcoin legal tender this week. Their Congress passed legislation requiring all businesses — except those without the technology — to accept payment in bitcoin.
This is a landmark historical event for Bitcoin that will be recorded in textbooks years from now. It is a big deal because this is the first time in history that an entire nation has attempted to adopt cryptocurrency.
Bitcoin is seen as a means of hope for a people who have experienced chronic political and economic instability characterized by coups, revolts, and a succession of authoritarian rulers. The country struggles with poverty, inequality and violent crime. Crypto is a saving grace.
The dominos are beginning to fall.
In baseball terms, cryptocurrency is in the 3rd inning. It’s early. Mass adoption will inevitably occur.
The US economy may seem great right now because people are flush with money. The government stimulated the economy through low interest rates and by handing out trillions of unearned dollars. It was not done through competition and ingenuity. That leaves the US economy poised to experience a significant fall, one of depression level proportions. The manipulation of money by the government, historically low interest rates, fast rising prices, supply chain breaks, housing shortages with skyrocketing real estate prices, and a stock market at all time highs are signs that a major correction is about to occur.
The crypto market is acting as a leading indicator. It is down about 50% from its highs. Considering crypto markets have fallen 85% from the high in previous cycles, a further drop is not out of the question.
The stock market looks to be on the same trajectory. Be cautious. It’s never bad to protect a profit.
The cryptocurrency market is relatively small at only about $1.5 trillion of a $400 trillion worldwide economy. That should lend itself to a much faster recovery when the dust settles on the impending drop.
The dollar is an analog instrument in a digital world. Technology is changing and cryptocurrency, led by Bitcoin, is the future. This is not going away, it’s only just begun.
Investing when blood is in the streets has proven to be the path to financial independence and the building of wealth. This may prove to be a great time to begin taking advantage of the drop in cryptocurrency.
