Should you pay for a cryptocurrency investing course?

It is troubling to me people in the cryptocurrency space are so derogatory towards paid advice.

I get that cryptocurrency is dominated by a bunch of libertarian millennials singing Kumbaya!

And yes! I too am aghast at the shilling going on… both with the ICOs themselves, of which 99.9% will fail and take investors money with them, and the blatant con men who don’t give a rip about anything other than parting you from your money.

I suppose it’s inevitable when there is this much money in the water. The sharks are everywhere.

But, to make absolute comments, like these, are doing potential investors a major disservice:

If this model of people doing it on their own is so great, why are so many doing it wrong?

Take, for example, this Tweet from a well-known developer in the space:

Here’s a hint…

If you want to be successful investing in Bitcoin and other cryptocurrencies, don’t take advice from the hoodies.

This is a new technology. Not a religion. To #HODL Forever is great advice. Until it’s not.

This coming from a thirty something and all, who has probably never invested before in his life and isn’t old enough to remember losing 80% of his portfolio he had worked an entire lifetime to accumulate when the last bubble burst.

To read all the white papers and learn all you can about the technology is equally terrible advice.

Behavioral economics tells us more information makes us worse investors, not better. It’s called The Green Lumber Fallacy.

Just a couple schlubs who happened to win a Nobel Prize study that stuff. But you can probably ignore it because, you know, this time is gonna be different!

Here are some other examples I pulled out of some of the chat rooms:

“I have $1000. What is a good sub $1 alt-coin to invest in?”

“Any thoughts on why Verge is tanking?”

Seriously. You might as well just put all that money in a big pile, pour gasoline on top of it and light the match!

Because, hundreds of billions of dollars, being invested by people having absolutely no idea what they are doing… always ends well! Right?

All sarcasm aside … Why would this be any different than any other investment?

Or anything else, for that matter?

Learning how to podcast? How to run Facebook ads? How to lose weight?

There are two ways to learn any of these things:

1. Spend huge amounts of time and money, make all the mistakes yourself, pay the price, learn from them

2. Find someone who has already done all that and pay them for their hard-won expertise

We are hard-wired to want to do the former instead of the latter.

That is, until you get old enough to realize touching the stove to learn that it’s really, really hot gets old after awhile.

So, come to think of it…

…maybe this is good for the millennials who aren’t playing with real money at this point, because most haven’t had time to save much yet.

This will be THEIR Internet bubble. And twenty years from now, they will be warning the next generation.

But what about the rest of us?

What about serious investors?

What about those of us who could REALLY benefit from crypto type returns?

But for whom this isn’t a game?

For whom, living well in retirement depends on making good decisions.

And bad decisions could mean we end up at 92 years old, living under a bridge eating cat food!

What about us?

We can’t afford to learn the hard way. The stakes are too high.

Gee! I know. Let’s turn to our financial advisors for advice.

They are going to be right on top of this, right?

As a former, 20+ year wealth and portfolio manager, I can tell you what is happening right now.

The financial services industry gets filthy rich selling the same horrible advice they’ve been selling for decades.

They have the biggest case of “not invented here syndrome” you could ever imagine.

The financial disincentives to do anything other than what they’ve always done, are massive.

So, sadly, you aren’t going to see that many well intentioned financial professionals diving in to help people understand crypto as a real asset class.

But someone needs to.

Turns out the rules of investing are not suspended just because this is a new technology… Albeit, in all likelihood, a massively disruptive one.

They are like gravity.

And the blockchain.

They are immutable.

And, if you break them, there is always a price. Always. Just wait.

So, is there real money to be made in this market? Yes.

Is this market trickier than the stock market? Yes.

Remember, profit is the reward for risk.

Can that risk be managed. Yes.

And, I would argue, if you aren’t paying at least as much attention to the risk as the reward side of the equation, we know where the money will be coming from, to pay the winners, in the zero sum game that is a market.

So, back to the original question… should you pay for a course on investing in Bitcoin and other cryptocurrencies?

Maybe.

The question is return on investment.

Will you recoup the price of the advice by 2X or 3X?

Will you do better than doing it on your own?

Are your chances of a successful outcome improved by paying for that knowledge?

If yes, then it’s simple. If no, that is simple too.

Sadly, there is a lot of absolute crap out there. A lot!

There is chum in the water and it is filled with sharks.

So, how can you tell the difference between real value, worth paying for, and hyped up garbage?

Here are a couple of simple heuristics for you:

✓ Big names, lots of followers, omnipresent ads and mainstream press are ALWAYS the wrong place to go …. James Altucher, John McAfee, Tai Lopez …. Please! I’m throwing up in my mouth right now!

✓ If they are teaching trading … Touting get rich quick … Suddenly a guru because they have quadrupled their little sister’s lunch money in a bubble? Run!

✓ They are not cheerleaders. You don’t want bulls… or bears. You want to find the owls.

✓ Use your gut … The people you are looking for are thoughtful, honest and smart … Are they saying things no one else is willing to say? Thinking in ways no one else is thinking? Speaking the truth even though it is unpopular?

✓ Their heart is in the right place. They live by the Zig Ziglar adage, “You get everything you want in life by helping others get what they want.”

That is who you want to learn from. That is how you tell the difference.

Use your gut. Use your brain. Be smart. Remember, this time is NEVER different.

Something to consider. As always, I hope you found it helpful …

As always, if you have any questions at all, about this topic, or anything else, just email me at askkim@sanecrypto.com. I read and answer every email personally. Or leave it in the comments below.

And, finally, disclaimer, disclaimer, disclaimer …. Everything I have said is for educational purposes only. Nothing should be considered investment advice. Past performance is no guarantee of future results. All investments involve risk… especially this one! So do not, under any circumstances, invest money you cannot afford to lose.