There’s an old adage about investing: “follow the money.” The ultra-rich are more than just dabbling in cryptocurrency; they’re leading the DeFi charge!
“Fake it till you make it.”
You know, this may sound a little bit cliché, maybe even a bit corny, but following in the footsteps of those who have come before is a well-documented pathway to success.
Even when people don’t have the ability, opportunity, experience, or resources to blaze their own path… they can copy somebody else until they’re successful enough to break out on their own.
Not everybody was born smart, attractive or rich…so some of us have to work at it.
“Following the money” really means following those who have it, and it’s a real, effective strategy in investing.
It works just the same in the cryptocurrency world.
Whenever I hear somebody poo-poo cryptos, saying they’re going to bottom out soon or that they’re a foolish use of money, I understand why they would think that…but I disagree.
Nothing is really holding up the value of cryptos except the crypto itself.
Bitcoin is hovering around $60K because we all agree that a Bitcoin is worth $60K.
If we truly wanted to, we could all agree that Bitcoins were worth $1 and that’s how much they’d be worth. That’s why I can see why somebody would think the bottom was going to drop out of the market.
However…that’s not a realistic expectation.
Following The Money
There are countless factors preventing this from happening—but the biggest reason why I believe that we won’t see cryptos completely tank comes down to WHO is actually buying cryptos.
It’s not anyone in particular, but rather a specific segment of the population.
It was uncovered recently that the world’s billionaires own 4% of cryptocurrency.
Now that doesn’t sound like a lot, but when you keep in mind that there are a finite number of coins in each crypto (until new coins are “mined,” which is a topic we’ll get into at another time), then that’s actually a sizable percentage owned by the uber-rich.
Currently, there are 18,876,056.25 Bitcoins in existence, and the billionaires of the world own 755,042.25—or $45.3 billion worth.
That’s important to know because if there is anybody on this planet that HATES losing money, it’s billionaires.
Funny how they’re the ones who can afford to lose it the most…
But while the fact that they’re so averse to losing money is amusing, it’s probably also a testament to why they’re billionaires in the first place.
But if these people are putting a significant amount of their wealth into cryptos, it’s pretty safe to say that they’re going to be around for a while.
And here’s the thing…
They all want to buy more.
Billionaire Buying Spree On Cryptos
These fortunes are managed by family offices of the uber-rich and are treated like that family’s own brokerage. A CEO of one such family office recently told The North America Family Office report, “We started allocating a small amount to crypto on the venture side. But, the funds have done so well, going up seven times over the past year, that it’s become a reasonable part of the portfolio.”
Crypto is another vehicle of the wealthy – and it’s a vehicle on which we can all catch a ride.
Anatoly Crachilov, CEO of Nickel Digital, a digital asset manager that works mainly with said family offices, also commented on the presence of billionaires in crypto, saying, “Initially, we were seeing an allocation of $2 million, $3 million. Tickets are now $5 million to $10 million and we’re seeing some large allocators who are now demanding tens of millions as a minimum starting rate.”
Again, if buying is ramping up, you can bet crypto is here to stay.
This is exactly why I’m trying to become as educated on these things as I can. If Blockchain is the way of the future, I’d rather be ahead of the curve.
Of course, it makes sense why billionaires have already beaten me to the punch. They can easily afford the high price of crypto buy-ins and they see their friends making 7X their money.
So, I say all that to say this: don’t be afraid of cryptos.
They’re going to be around for a while…
And I’m going to do MY best to make sure you have a solid grasp on how to join the ranks of people like Alan Howard and Paul Tudor Jones.
Until next time…
“A prudent man will always try to follow in the footsteps of great men and imitate those who have been truly outstanding, so that, if he is not quite as skillful as they, at least some of their ability may rub off on him.” — Niccolo Machiavelli