Understanding the Wealth-Creating Power of Cryptocurrency – InvestorPlace

Written by Amanda

Understanding the Wealth-Creating Power of Cryptocurrency  InvestorPlace

Well, one thing is for sure: Nothing is going to be the same in the crypto market after this year.

Perhaps the most jarring example of the bearish crypto market this year has been the complete collapse of Terra (LUNA).

Stock chart showing the price of Terra (LUNA) after its collapse.

Source: StockCharts

As you can see, it’s not pretty. The coin lost 98% of its value or around $40 billion, in a matter of hours.

While this drop was shocking for a lot of crypto investors (and rightfully so), it just goes to show that value destruction can happen to even the biggest cryptos out there.

The sister token to TerraUSD (UST) – an algorithmic stablecoin pegged the U.S. Dollar – exposed a major fault within the crypto industry: under-collateralization.

However, my team and I don’t see this as fault. Instead, we see it as an opportunity of what to look for and what to avoid.

I firmly believe cryptos and blockchain in general represent some of the most promising innovations of our time. But just like the internet before it, this shift won’t happen overnight.

Long-term, I am extremely bullish on cryptocurrencies. But this cryptocurrency bubble must reach its natural conclusion the same way the dot-com boom of 2000 did — with an enormous crash.

While this may be the beginnings of “the big one” for cryptocurrencies, this crash isn’t the end. It’s far from it.

The Cryptocurrency Revolution Has Begun

This is the beginning of the Cryptocurrency Revolution. It’s the end of bad cryptos just built on hype and the emergence of strong ones made with world-changing tech.

We have strong cause to believe this, including using Gartner’s “Hype Cycle.” It teaches us that new technologies go through five phases:

  1. Technology Trigger — A new breakthrough technology emerges. New companies are born. Early VC investors pour money into those businesses. And a small wave of early adopters take advantage of this new tech.
  2. Peak of Inflated Expectations — Mass media coverage begins. Tons of new companies emerge, all hoping to capitalize on the trend. Everyone starts hyping up the tech as the “next big thing.” And more and more mainstream folks begin hopping on board.
  3. Trough of Disillusionment — First-generation products based on the tech disappoint. New companies start to fail. The media talks about those failures. The hype train fades, and new VC money comes into the space as sky-high expectations crash down.
  4. Slope of Enlightenment — The mainstream media forgets about the new tech. But the companies that remain work to finetune it and develop second- and third-generation products with much clearer value props and use cases.
  5. Plateau of Productivity — The masses begin using the tech. And the companies in the space enter a prolonged period of durable growth.

The stages are represented graphically in the following chart.

A chart of the hype cycle

We believe cryptos are somewhere in the “Peak of Inflated Expectations” phase. Big-name cryptocurrencies will begin to fail, and the mainstream media will begin writing about these failures.

Over the coming months to years, we’ll enter the “Trough of Disillusionment.” This is where thousands of cryptos will fail. And several hundred billion dollars of value will be wiped out.

Investors who are smart here will make millions.

Big Money’s Emergence

After the Trough of Disillusionment comes the Slope of Entitlement, swiftly followed by the Plateau of Productivity. The big money is made in these phases.

There, the wheat is separated from the chaff, and true visionaries and innovators in a new technology emerge.

During the internet era, this durable growth phase started in 2003. In that time, companies like Amazon (NASDAQ:AMZN), Netflix (NASDAQ:NFLX), Facebook and Alphabet (NASDAQ:GOOGL) used the internet to create second- and third-generation products and services that would go on to change the world.

Cryptos will follow the same path.

You could do a lot worse than buying Bitcoin at this price. But there’s a much bigger opportunity at hand…

Indeed, you could do much better in several of Bitcoin’s smaller cryptocurrency “cousins.”

In fact, there are a handful of very small coins that could soar more than 31 times that of Bitcoin.

That’s right. If you’re poised to make $10,000 in BTC, you could make 31 times that — $310,000 — in its tiny cousins.

Or if you’re poised to make $100,000 in BTC, you could make $3.1 million instead.

The million-dollar question is: What are the best cryptocurrencies to buy today that have enormous long-term upside potential? These are the ones that could help you achieve total financial freedom in a very short time.

I urge you to learn about this huge story. I’ll teach you about the transformative technology of altcoins. And I’ll share how to leverage this undercurrent of cryptocurrency innovation to set yourself up for life-changing returns.

Cryptocurrency Offers the Fastest Legal Way to Get Rich

Right now, there’s a fuse being lit under the altcoin market. And it’ll set off one of the largest explosions of wealth in modern history. People who invest modest stakes in altcoins will make millions of dollars.

To truly realize the magnitude of this opportunity, you must understand that altcoins are different than how most perceive them.

These assets aren’t “fantasy internet money.” And many are about to skyrocket thousands of percent.

They’re investments in one of the most valuable, most revolutionary technologies ever created.

And they’ll generate a multi-trillion-dollar tsunami of wealth for their owners.

Remember; the underlying technology behind Bitcoin and altcoins is the blockchain.

You can think of cryptocurrency and the blockchain like a virtual ledger.

But I prefer to say blockchain technologies are just really, really, really valuable software programs.

Now, if you’ve paid attention to the stock market over the past 30 years, you should be ready to jump out of your chair and buy altcoins with both hands right now.

That’s because software programs are the oil of the 21st century. They are one of the greatest forces for wealth creation on Earth.

In the 20th century, the discovery of oil deposits around the world minted millionaires faster than anyone could count.

It was one of the fastest, biggest accumulations of wealth in history. People went from being broke to having more money than their grandkids could ever spend virtually overnight.

Wealth Creation on Steroids

When I say software programs are of the greatest forces for wealth creation, I’m not talking about conventional wealth creation. That takes 30 years to save up $1 million.

I’m talking about wealth creation on steroids, where Investors can make $30 million in one year. I know that sounds outlandish, but let’s look at the amazing facts right in front of us.

Bill Gates became one of the world’s richest men because of software programs. Just think about the Microsoft (NASDAQ:MSFT) spreadsheet program we call “Excel.”

How much time did Excel save the human race — a billion years, 10 billion years?

Excel is now the world’s most popular spreadsheet program. By allowing us to automate calculations and financial analysis, it has saved us incredible amounts of time. We no longer have to do single calculations by hand.

One person running Excel can do the work of a million accountants from days past.

Software programs have incredible power. And it’s spread across all industries.

Software’s Far Reach

Over the past 30 years, software programs have created an explosion of efficiency and human productivity. Great software can help you make smart business decisions, find travel deals, talk to loved ones, and get a cheap ride home.

It has massively improved our ability to communicate, share information, complete transactions, and gather and analyze data.

Think about health care, education, transportation, manufacturing, energy production, food production, retail, banking, you name it. Computer programs have allowed us to do it all much more efficiently.

Good software has saved us so much time, money and frustration. It’s no wonder it’s kicked off one of the largest, fastest accumulations of wealth in human history.

In 1986, computer program leader Microsoft went public. Shares are up more than 1,185% since then.

Computer program leader Oracle (NYSE:ORCL) went public in 1986 as well. Oracle founder Larry Ellison is one of the world’s richest people, worth over $90 billion.

In 1998, Larry Page and Sergey Brin founded Google and created the world’s most valuable search engine program. Both are now worth more than $90 billion each. And their early backers made billions, as well.

Software programs have become the world’s ultimate wealth creators. That’s because we all place enormous value on their ability to save us time and headaches. And it’s also because they’ve made us massively more productive.

Which brings me to my million-dollar point.

Blockchain technology is about to unleash an epic new wave of computer program wealth.

Real altcoins aren’t anything like “fantasy internet money,” as they’re portrayed in the press. Investments in the best of them are investments in the next generation of revolutionary software programs.

Blockchain: A Transformational Technology Taking Shape

Big picture, blockchain allows for disintermediation across all industries. It’s arguably the most disruptive technology since the internet. And at its core is its centralized and immutable ledger.

This ledger enables innately untrustworthy entities to create trustworthy systems, all without the need for any central authority.

Blockchain enables folks to remove the middleman from legacy systems and replace them with a collective ledger.

Now… why would we do that? Because middlemen are often unnecessary profit-takers.

Further, they’re sometimes subject to corruption (see: the financial crisis of ‘08).

By removing and replacing them with an automated and incorruptible technology, we can make today’s systems and processes cheaper, faster, and more trustworthy.

Huge Potential Underlying Cryptocurrency and the Blockchain

The applications here are theoretically infinite. One that Wall Street is currently drooling over is decentralized finance (DeFi). With cryptocurrency, we can create a new era of finance that doesn’t involve big banks as profit-taking intermediaries.

And DeFi is the future.

After all, it’s intended to disintermediate banks, like Goldman Sachs (NYSE:GS), JPMorgan (NYSE:JPM), and Wells Fargo (NYSE:WFC). Those are multi-hundred-billion-dollar companies. The disruption opportunity is huge.

But there’s a much, much bigger opportunity in disintermediating technology titans like Alphabet and Amazon, who are trillion-dollar companies.

That’s why I love the idea of “dApps,” or decentralized applications.

DApps are software applications built on the blockchain. And this can be anything. Think a video media application like YouTube, a driver-rider app like Uber (NYSE:UBER), a music streaming app like Spotify (NYSE:SPOT).

These apps are coded on the blockchain. And therefore, there’s no central authority that “runs” and profits from the app, either via subscription sales or digital ads. By removing that central authority, dApps create a new generation of truly free software applications.

Oftentimes, these dApps have underlying cryptocurrencies. They’re used as a form of in-app currency or incentive token for developers and blockchain participants.

The appreciating value for these cryptos represents the economic value of the dApp. Instead of developers profiting from digital ad sales, they make money by owning the dApp’s cryptocurrency. And that rises in value as more folks use the platform.

I firmly believe that dApps will disrupt everything. The future YouTubes, Ubers and Spotifys will be dApps. In fact, most, if not all, apps in the future will be dApps.

The Final Word on Cryptocurrency

During the internet craze of the late ‘90s and early aughts, the companies that succeeded did something very simple.

They didn’t reinvent the wheel or create brand-new industries.

They just digitized what was already working in the physical world.

Malls were working. So, Amazon digitized malls and turned into the “digital mall.”

Movie theaters were working. So, Netflix digitized movie theaters and turned into the “digital movie theater.”

The “winning playbook” in the dot-com boom was astoundingly simple. Find something that’s working in the physical economy and digitize it.

And the “winning playbook” in the Cryptocurrency Boom will be equally simple. Find something that’s working in the digital economy and decentralize it. The cryptocurrencies that do this the best will turn into 100X investment opportunities over the next decade.

When you shift your perspective on altcoins, you realize that they’re not fantasy internet money. They’re investments in systems that make our lives easier, more productive, and more efficient.

Investing in the best altcoins now is like taking an early stake in Adobe (NASDAQ:ADBE) in 1998. It created the hugely popular “PDF” program. And the stock has soared 3,809% since then.

That’s why we’ll be holding an emergency briefing on June 14 at 7 p.m. Eastern. We’ll discuss how the phenomenon plaguing the crypto markets recently could spark the minting of a new wave of millionaires.

Despite all the negative headlines we’ve been seeing, a new day is dawning. And a select few off-the-radar coins will emerge as the new leaders of the cryptocurrency markets.

If you want to get ahead of this phenomenon, sign up for my free Crypto in Crisis event now!

On the date of publication, Luke Lango did not have (either directly or indirectly) any positions in the securities mentioned in this article.

Source: investorplace.com

About the author


Hi there, I am Amanda and I work as an editor at impactinvesting.ai;  if you are interested in my services, please reach me at amanda.impactinvesting.ai

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