Trading Journal

Cryptocurrencies - The Multi Million Perspective.

Updated 2 months ago

Perspective, it can make or break your success in the investment industry and even more so in the cryptocurrency market where one day you’re up 70 percent, on the phone to Lamborghini to lock in your custom specification and then a day later all logical situations have been wiped out the equation and your investment is in the negative at a region you never expected. Sound familiar? Welcome to cryptocurrencies.

In a market this volatile, functioning chaotically 24 hours a day, 7 days a week it is hard not to get caught up in the irrationality of what is really going on sometimes. I mean, where else do you get tenfold the returns of regular investable assets such as the S&P500, mutual funds and even corporate bonds, in a single day? These regular investments provide in a very good year a percentage return in the 20’s, that’s not taking into account a regular saving scheme with a bank is fortunate if offered over the 1% annual mark. Therefore, It’s easy to view a 30 percent day of profit in the cryptocurrency market as a miracle and a sign to liquidate your position and go running with the profits whilst going is good, but remarkably it’s the day traders doing this who are really losing in this market.

Change is hard, it’s not within our biological makeup to adjust well to change, especially when we have become so accustomed to the boundaries and limitations society applies and brainwashes us with daily to never stray from. Fear is a substantial by-product of making a change and is what restricts growth and development from ever becoming a reality for most. This is the same reason the majority of the population fears leaving a regular 9-5 corporate job, which pays enough to get by on basic necessities instead of pursuing their dreams to live within their own means of true happiness and freedom. The same cultural limitations that tell you to pursue endless years through the educational system and work for the rest of your life in anticipation that one day you may get to live and see the day you can withdraw from your pension pot and survive in a majority of cases, on a modest pot of a low 5-figure sum for your remaining retirement years. We have also grown accustomed to saving account interest rates of the sub-zero’s and stocks needing very large investments to see considerable returns, so can we really blame society and the faces of mainstream media such as nearing-retirement economists and bankers alike for screaming cryptocurrencies and Bitcoin, in particular, is in a bubble? Absolutely not. They have spent their entire lives following the pre-programmed mentality the world's elite has governed us to follow, it’s unrealistic and never been seen before in the history of finance. But it’s very real and it’s going to continue for a very long time. Take a look at the laptop or phone you’re using right now, did anybody ever believe these devices would one day become global household essentials?

This brings me to the purposeful importance of perspective and why those who are now inflowing this market are still truly scared to change and believe in the future and what lies ahead. A quick browse of any forum shows fear is all around us, nobody truly knows what they’re investing in and even if they do, they’re still struggling to let go of past limitations of profits. It’s funny that the majority of ‘investors’ are chasing the next Bitcoin from almost every single investment they delve into, yet these people would never have the capabilities of breaking the fear barrier to even hold to such levels. It’s no coincidence those who made the real money from Bitcoin, the tens of millions and beyond never even knew they still had Bitcoin in a wallet, they had no emotional attachment and didn’t even realise an investment was running so high into profit. Whereas those who watched it surge and remained conscious of their risky investment never sustained to hold above $10.

So what’s the perspective we need here? The fearless and long-term perspective. Where we begin to accept and surrender ourselves to the flow of this new market dynamic, where things are unregulated and wild as they can be. A beautiful cocktail of characteristics that have turned many into overnight millionaires from quite literally the financial equivalent of what most would splurge on a night out or dinner, for real.

If you had invested just $1,000 into the following cryptocurrencies last year at exactly the 1st January 2017, you would have right now, from holding for just one year approximately:

  • Bitcoin = $14,000
  • Ethereum = $87,000
  • Ripple = $335,000
  • Litecoin = $50,000
  • Monero = $24,000
  • Dash = $89,000
  • NEO = $516,000

If you were to do the percentage gain maths on those sums you could quite literally faint at the disbelief of what is actually happening in our lifetimes right now. It’s illogical, irrational and outright insane… The opportunity to capitalise on the greatest wealth shift the world has seen since the real estate market boomed to ridiculously overvalued levels is right here now in the present, yet so many cannot break the mould of what they believe the world should work as and how financial markets should be functioning. It’s easy to focus on the short-term gains in the market because of this and ‘realistically’ anywhere from 20-100% is outrageous compared to anything we’ve ever seen before, but if the market is offering patient, discipline and calculated investors the likes of thousands in percentage profits for sustaining just several months or even a year longer, what’s the danger in investing and forgetting about your investment until you’ve captured what the market is truly offering? If that’s what investors made in the first ever year of mainstream acknowledgement, what happens to those numbers when adoption and acceptance happens?

By focusing on the long-term perspective not only do you begin to shift from the social limitations of what life should be and is meant to be, you focus on what life could be, especially with the technological advancements certain cryptocurrencies are bringing forth. The market is so young it couldn’t possibly be in a bubble yet, critics are claiming a bubble because they’ve seen a bubble form from growth spanning decades. Yet they ignorantly ignore the time aspect of this market, only focusing on the price increase when we’ve barely started gaining mainstream traction last year, let alone the beginning of adoption starting from this year onwards so how could we possibly be ready to burst when this bubble has barely begun levitating?

This technology has a long way to go and we will see absolute madness throughout this period, it will get messy, it will get great, it will be an emotional rollercoaster to say the least… But when all’s said and done five years down the line and we have fully integrated partnerships and utilisation of cryptocurrencies in real-life business models which will in return continue send valuations soaring to unbelievable levels, are you going to look back and think wow that 30% month five years ago was great? Or are you going to look back, pat yourself on the shoulder and reflect on how well that multi-thousand percent past few years have been?