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HEALTH, WEALTH, AND HAPPINESS

May the Fourth, 2022

"We have no more right to consume happiness without producing it than to consume wealth without producing it."


- George Bernard Shaw

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Blockchain Investing Ideas

with Alexandre Lores


Hi Everyone,


Last week, I wrote to you about the Central African Republic adopting bitcoin as legal tender. Since then, another nation-state has taken a similar step toward adoption (not quite legal tender), and at least two other major news events occurred that I will briefly cover. 


Global adoption of blockchain technologies is happening so fast that it's hard to keep up, even if you study blockchain markets full time. 


So why isn't bitcoin's price going to the moon? April was a brutal month for the digital currency's price, as it declined 17.8%.


I don't have all the answers, but my experience over the past five years tells me that short-term price action is rarely correlated to adoption news. 


First, let's note that bitcoin is still correlated to the stock market. If you click on the above link, you will see that the S&P 500 has fallen 13% this year. The Nasdaq composite has declined over 21%.


Assets that are considered riskier (stocks and crypto) are down over the past few months. The biggest reason for this is that the Federal Reserve is raising interest rates to combat inflation, and market participants are pricing in more rate hikes. It appears unlikely that this will change until the general course of the Fed changes. 


Now let's zoom out and take a look at the biggest adoption news of the week.

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3 big events 


Not one, but three major events occurred in the past week. These seem commonplace now, but in 2017, any one of these would be news in the crypto world for a month.


1) Panama


The Panama legislature approved a crypto-friendly law, with lawmakers voting for it 40-0. It stopped short of declaring bitcoin legal tender, but it exempted digital assets from capital gains tax. Gabriel Silva, the lawmaker who proposed the bill, tweeted that the bill would "help Panama become a hub of innovation and technology in Latin America!" For the bill to take effect, President Laurentino Cortizo must sign it. 


2) Joe Rogan


The controversial podcaster called bitcoin a "viable form of currency" and compared its growth to the early years of the Internet. While this isn't exactly shocking news to those of us working in crypto, this is massive in terms of adoption. His podcast, the Joe Rogan experience, was launched in 2009 and had millions of listeners by 2015.


It is the most popular podcast in the world, according to a Newsweek article published last November.


Per one report, there are an estimated 200 million downloads of his podcast each month. That's a lot of ears.


3) Elon Musk Bored Ape Picture For Proof 


I am sick of hearing the word "ape". You have heard about apes twice in the past week even if all you did was read our columns. But my opinion doesn't matter in this case.


When Elon Musk pins you as his PFP and trolls you in a tweet, that's great advertising. After all, he's followed by almost 91 million people and bots. 


Congratulations to Yuga Labs for surviving their problematic metaverse land sale and to the holders who experienced the 20% pump of apecoin (APE) this morning.

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Investor's take


My view on bitcoin remains unchanged from last week. 


In the short-term, I expect neutral or negative bitcoin price action as the Fed raises benchmark rates to fight inflation, which is something I believe will likely continue for the rest of 2022 and at least some of 2023.


In the long-term, given our current world's macroeconomics and geopolitics, my take is extremely simple:

  1. Bitcoin significantly outperformed all asset classes over the past decade.
  2. I expect bitcoin to substantially outperform all asset classes over the next decade.



Buy and HODL bitcoin. 



Sincerely, 

Alexandre Lores

Opportunity Analyst

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Bitcoin Market Journal is a daily newsletter that makes you a better crypto investor. It is created by Evamarie Augustine, Charles Bovaird, Mati Greenspan, John Hargrave, and Alexandre Lores.


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