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HEALTH, WEALTH, AND HAPPINESS

May 18, 2022

"I'm not persuaded that the opposite of poverty is wealth. I've come to believe ... that the opposite of poverty is justice."

- Bryan Stevenson

New Investor Scorecard: Solana (SOL) aims to become the next-generation platform for blockchain applications. Given its fierce competition with Ethereum, how do our analysts rate its long-term investment potential?

Members can click here to download our new Solana Investor Scorecard.

Not a Blockchain Believer? Get access to our library of crypto investor research and ratings: click to sign up.

Don't You Dare Use Your Emergency Funds for this Dip (Reddit): Sensible advice (with salty language) for uncertain times: "If you have a DCA [Dollar-Cost Averaging] schedule, be disciplined and stick with it."

Investor takeaway: When the market takes a dip, Blockchain Believers may be tempted to spend emergency funds to buy bitcoin, because the price is so low.

Instead of spending money you don't have, you can use this time to set up a Steady Drip Investing system, which can help you build long-term wealth and avoid trying to "time the market." Here's how.

Regular readers of our newsletter know about the spectacular collapse of TerraUSD and its companion token Luna last week: we warned you.

Now, we're warning you again.

Founder Do Kwon has put together a plan to resurrect Luna. Instead of building a stablecoin backed by value, as we suggested, he is taking the opposite approach, relaunching Luna with nothing backing it.

Because Terra is "decentralized," this proposal is now before the community for voting. You can watch the live votes as they come in, with the vast majority voting "Yes" (click here to see the vote).

Ask yourself: as a long-term crypto investor, would you ever re-invest in a token that had collapsed like this?

Investor takeaways: Whether or not this proposal passes, we wouldn't touch Luna with a hundred-foot pole.

Let's learn the lesson: crypto projects, like tech companies, must provide real value. Simply re-issuing a token and hoping "the community will support it" is not a business plan.

If you need more proof, the Terra legal team has quit. Need we say more?

Why You Should Attend a Crypto Conference

1. Networking

Personally, this is my favorite part of crypto conferences. In fact, sometimes I have to force myself to actually go in and listen to the speeches. While Twitter Spaces is great, there is no way to replace the in-person connections you make at crypto conferences.

Yesterday I was sitting next to a Google employee at one of the talks. At crypto conferences, I have had the joy of meeting my internet friends, and I've also made friends with members of the media, project founders, project employees, senior vice presidents at marketing firms, and crypto noobs. 

2. A Chance to travel

While this was a short trip for me, a 3 1/2 hour trip across Florida via highway, there is something healthy about leaving your home or office for a few days. It's a good chance to get outside your comfort zone and explore a little bit. 

3. Up-to-date announcements

While you could argue that lots of great crypto content is available online (it is), at crypto conferences you sometimes get news announcements in real-time, even before they hit Twitter. The announcement that El Salvador was adopting bitcoin as legal tender was announced by Jack Mallers at Bitcoin 2021. 

Yesterday, Robinhood co-founder and CEO Vlad Tenev announced the company's imminent beta test launch for the Robinhood self-custody crypto trading wallet on stage. 

4. Learn new things

While this is less of a highlight for me as a veteran in the crypto space, and I am certainly not a fan of 100% of the speakers, I always learn new things from the presenters to help myself stay sharp and gain new perspectives in this fast-growing industry.

5. Hot tip

Lastly, here is a hot tip to avoid high costs. Book way in advance. 

If I am not invited as a speaker, and I really want to attend a conference, I book it as soon as I can. For example, I bought tickets for Permissionless last year, when they sold their first 100 tickets for $50. If you buy them today, it costs $2,500 to get in. 

Investor's take

Let's go back to the markets for a moment. As I have said multiple tines recently, I remain bullish about bitcoin and ether from a 10-year perspective. 

Also, for once I am bullish in the near-term. While there are a lot of factors to consider, more and more of those factors indicate that the bleeding is slowing down and almost over. The bottom is near for stocks and for bitcoin.

Here is why I came to that conclusion:

1. Bitcoin is currently tightly correlated to the S&P 500, as reported by CoinDesk.

2. The Wall Street Journal conducted their usual economists' survey. The results? The consensus is that the Federal Reserve is expected to move the benchmark interest rate to around 2.75 - 3.00%. Why is this good news? This means that institutional investors that influence the stock market have already priced these moves in.

3. While my Twitter followers totally disagree with me (see poll), consumer inflation appears to have peaked, dropping from 8.5% in March to 8.3% in April. If it continues to go down, the Fed is not under pressure to raise interest rates beyond what is expected above.

4. The Luna Foundation Guard’s sell-off of its treasury of bitcoin was the catalyst in last week’s crypto crash. According to the organization's official Twitter account, its supply of 80,394 has now been drained down to 313, which is not enough to affect its price. 

1. Investors should consider dollar-cost averaging (DCA) into bitcoin and other cryptocurrencies they plan on investing in for the long haul, such as bitcoin or ether. To put it briefly, DCA involves making consistent, regular purchases in order to reduce the impact of volatility. Investors should also take a look at enhanced DCA, which I covered in this research piece. In short, it involves making larger investments when an asset is down, and smaller ones when it is up.

Sincerely, 

Alexandre Lores

Opportunity Analyst

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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