I am sure that the title of this blog may have gotten your attention and now you want to know this blogger’s political opinions. Far from it, I honestly am not surprised by the results of this past election or care who won because at the end of the day, if you invest you just want certainty in the markets. So no, this blog post is not political by any means but will have some political thoughts for you to take advantage of good ole capitalism because, at the end of the day, the government is not here to save you, so you must stay informed and save yourself. Alright, so let us get into it. The Winter is Over, the halving has happened, and the crypto markets are booming again, but why, let me explain.
Certainty in the Markets:
Whether you trade cryptocurrency, futures, options, or buy and hold the markets have seen an uptick in most equities or other assets, why, because the election is finally over. No more ad campaigns, interruptions on my YouTube shows, shoot even Netflix regarding who is better for America. Let's be honest, you control what happens with your assets if you know how to play the game, and now is the perfect opportunity. If you invested before the BTC halved or got in when Bitcoin dipped to 20K about two years ago, you may be so happy you did. Bitcoin is now at an all-time high at the time of this writing above 80K and many have it projected to 100K or higher. That’s crazy to imagine the gains on this asset alone.
Trump’s In Office:
Ok, so maybe this is not something you want to read or hear, regardless, it is what it is. America chose who they thought was the best candidate, as an investor you adjust, do not get emotional over who is at the helm but plan for the next four years so that your assets are good and your family. With that being said, Trump was considered a better candidate for cryptocurrency because he wants to use cryptocurrency, particularly bitcoin, to hedge against growing debt and the weakening dollar and also to promote growth within the cryptocurrency space. We won’t know if this is true or not but still the markets like the sentiment.
If you have been in cryptocurrency for a while, you know that there are a lot of checks and balances when it comes to trading and regulation. KYC or Know Your Customer is a way for the company to know who you are and regulate your trades, it also helps to inform the SEC for tax purposes, etc. At the end of the day, trading in crypto markets has certain risks but also rewards.
With Trump being pro-crypto it can signal safer trading, and possible regulation but not as extreme as it has been in the past. This is apparent with the recent firing of Gary S. Gensler who many believe was anti cryptocurrency. Gary Gensler was the chair of the U.S. Securities and Exchange Commission or SEC. With this firing a new SEC chairman will be appointed under Trump and allow other litigations to be shifted, think XRP. Regardless of whether you like Trump or not, these moves are critical for cryptocurrency to reach new heights.
Institutional Investing:
People still think cryptocurrency is a scam. Even institutional investors were saying cryptocurrency is a scam, but now the big names like BlackRock, Morgan Stanely, and other asset managers understand the value of cryptocurrency. This has been shown by the centralized brokerage, 401Ks, etc. allowing you to invest in crypto ETFs. For most retail investors this is a “safer” way to invest, as opposed to utilizing decentralized exchanges for investing, which typically aren’t regulated, and liquidity can be an issue.
The increase of institutional investors promotes more liquidity in the markets, more liquidity means more opportunity to increase the value of assets, in particular, Bitcoin or BTC. Remember, halving has never had institutional investors involved at this level. Remember, the big money moves the markets. Understanding how institutional investors are using or investing in cryptocurrencies can make you money.
How Are Institutional Investors Using Cryptocurrencies?
Most institutional investors are interested in spot cryptocurrencies like BTC and ETH, in addition, interested in tokenization. Tokenization is converting an asset or the ownership rights of an asset to a digital form using blockchain. Tokenization is valuable because it allows access to new assets, increases liquidity, no middlemen or transactions processed faster, and lowers the cost of obtaining the asset.
The Institutional investors are utilizing the blockchain, the same way we retail investors were before cryptocurrency became mainstream and this is why those who have been in cryptocurrency still believe we are early because most people do not understand the value of crypto.
Next Action Steps:
Alright, so you may be asking yourself how does this help me? As stated, you are still early in earning a return on your investments in cryptocurrency. Although some gains have already occurred there are plenty of altcoins that you can invest in. Altcoin is anything that is not Bitcoin. I invest in BTC, ETH, XRP, and Solana. Those are my heavy hitters, everything else is purely speculative. I am not here to tell you what to do, but just to give you information about how I believe the market is moving. Remember this is not financial advice, just information and you should always do your research.
Miners should do well with Bitcoin going up, miners like RIOT, CLSK, MARA, and others. I would buy shares or trade options on these. I am currently trading in Riot. Certain exchanges will let you trade derivatives, spot trade, or exchange cryptocurrency, while bitcoin may be super high you could trade altcoins for a return on investment.
Dollar-cost average into your top cryptocurrencies so you don’t have to keep timing the markets. Look, there are so many opportunities as long as you stay informed and invest you should make a return on your investment hopefully in your favor.
Conclusion:
I believe that the winter is over, but there could still be some pullbacks, that’s part of investing though. Although you may or may not be happy with the outcome of the election, the benefits of having a pro-cryptocurrency president will help with bullish market sentiments. The changing of the SEC chair is major for deregulation or the change in the regulation of cryptocurrency, in addition, will help promote new projects for cryptocurrency in the United States.
Institutional investors are now seeing the value of cryptocurrency and how much return on investing you can get. But also, the decentralization days may be less appealing and hard to wrap your head around especially if you have been trading cryptocurrencies assets for a while. You are still early, start investing. Just know that BTC may be hard to invest in due to it reaching all-time highs.
Remember, investing in anything is about making money, and investing when something is at the top goes against the adage, “Buy low and sell high”. Remember “We are all going to make it”. #WAGMI.
If you are unfamiliar with some of the information presented, check these old articles where I talk about halving, centralization vs decentralization, hedging, etc.
