3 Bitcoin Strategy
Central banks and the people they serve benefit from rising asset prices.
Asset prices can be predictably increased by inflating the money supply with additional fiat and “injecting” it into the economy via multiple mechanisms.
This has the impact of reducing the purchasing power of existing units of currency already in circulation — our savings and our income.
The “elite” own Gold and they own other assets that increase in value during inflationary periods. They collect rising rents for these assets during money printer mania.
What’s really happening is wealth is being transferred from the working poor and savers into the hands of assets owners and operators inside the financial system in general. Most of this wealth wasn’t made on Wall St… it was from hard work like agriculture, mining, manufacturing and the rest of the labor that built the world.
I think of this as the greatest heist in history because this purchasing power is being depleted without the knowledge or consent of the people.
Our wealth is being drained and transfered to elite asset owners using inflation.
This heist has caused a strain on the gears of the global economy. The FED and other central banks are in a bind. If they keep rates low, inflation rages. If they keep hiking rates, they risk crashing the economy.
Interventions are occurring at increasing rates throughout the global economy now that China has become very active. We could see more bailouts, more government intervention, maybe even new types of financial controls. It's uncharted territory. But one thing's for certain: The fiat money experiment where governments have nearly unlimited power over the money supply is unraveling thanks to fraud and abuse.
My thesis is that we are in the final stages of the fiat experiment and soon we’ll see things occur like a major country issuing debt and/or printing cash to buy Gold and Bitcoin. That will be a heavy signal when entities with the most resources and data (governments) begin transferring wealth energy from fiat to hard assets.
What To Do About It?
Put simply: buy assets that you anticipate inflating in value during this period and sell assets you believe will become worth less.
Even if we don’t see central banks and sovereign wealth funds run to Bitcoin, individual and corporate adoption is still just beginning - Bitcoin’s market capitalization is just $1.3T and the total aggregate value of all assets on Earth is approximately $900T.
As adoption grows and the network expands Bitcoin has exponentially increasing surface area for growth.
Why Bitcoin and Not Gold?
Your bank has the power to freeze your account, right?
Governments can seize assets, place restrictions on how you spend your money. This is censorship, plain and simple, and it happens all the time for reasons ranging from the legitimate to the downright tyrannical. Gold has been seized by the US Gov and every other government in the world.
Bitcoin operates outside that system.
If you hold the keys to your Bitcoin wallet, nobody – not bankers, not governments – can stop you from transacting.
It's your money, and you get to actually control it.
Gold is a classic store of value, but let's be real... it's not practical. Try buying a cup of coffee with a gold bar. Bitcoin solves this problem because of a little thing called "satoshis” or sats.
A single Bitcoin can be broken down into 100 million satoshis – tiny fractions that enable everyday use.
This divisibility is critical. It means Bitcoin can function as both a way to store large sums of wealth and as true currency for buying and selling. Imagine that potential future where instead of pulling out your debit card, you could simply scan a code with your phone and pay in Bitcoin.
Storing Gold securely is a headache, transporting it is a risk, and its value, while relatively stable, isn't exactly practical for buying your groceries.
Cash, as we've discussed, is losing purchasing power faster than ever. It's also vulnerable to theft and physical damage too.
Bitcoin? If you have internet and your wallet keys, you can access your Bitcoin from anywhere in the world, 24/7. Wallets can be kept offline on specialized hardware (cold wallets), making them nearly impervious to hackers.
You can move millions in Bitcoin across the globe faster and often cheaper than the traditional banking system can wire a hundred bucks to your aunt.
Security: Built into the Blockchain
We live in an age where cybercrime runs rampant.
Hackers constantly target banks and financial institutions.
Good luck hacking Bitcoin. Every transaction is verified and recorded on the public ledger. This creates an auditable trail of ownership that's incredibly hard to fake. Complex cryptography scrambles the data and secures the network. Trying to hack BTC would require insane amounts of computing power to counterbalance the millions of nodes in the growing Bitcoin network, way beyond what any individual or even most governments can muster.
Because the blockchain is distributed across tens-of-thousands of computers, there's no single point of failure. Take down one computer, and the network hardly notices.
This doesn't mean there aren't risks, but the underlying security is far more robust than traditional banking systems that are constantly under assault.
The Big "Buts"
I'm not going to sugarcoat this: there are downsides and risks to Bitcoin that you absolutely need to consider:
Volatility
Big swings up and down are common. This is partially because it's a relatively new asset, and the market is figuring out where it fits.
Adoption
Still not widely accepted for buying everyday stuff, although major companies like Microsoft and Tesla are warming up to it.
Regulatory Uncertainty
Governments haven't fully wrapped their heads around crypto. Future regulations could impact its value and use case.
Bitcoin’s price action is a rollercoaster right now. If you are saving money for a house and need the downpayment in the next 6 to 12-months… I’d consider storing your wealth in a short term CD or some other vehicle that you can rely on the liquid value in a set period of time.
If you have a longer time horizon, I have a strategy…
3 Bitcoin Strategy
The fiat system is teetering. Wars and rumors of wars growing.
I'll be blunt: I think the world is heading towards more economic turmoil. If I am right it is wise to move capital into Bitcoin.
If trust in central banks and currencies keeps eroding, guess what people start to look for? Alternatives.
Bitcoin, with its built-in safeguards, its resistance to manipulation, and its promise of true financial freedom is a critical counterbalance to a very broken financial system.
For far too long ordinary people have unknowingly played a rigged financial game. Central banks dilute our money. Governments borrow until there's no tomorrow. Wall Street takes risky bets, and we end up footing the bill when things go bust. Sometimes Government, Corporate America and Wall St team up to form a “Public Private Partnership” or what I like to call Big League Thievery.
Fiat currencies are not built on a solid foundation. The system depends on trust, and that trust is fading fast.
Bitcoin isn't perfect. It comes with risks, volatility, and a whole lot of unknowns. But within this complex new asset, I see the seeds of something potentially revolutionary:
A currency that truly belongs to you outside the reach of overzealous government control.
A shield against rampant money printing and inflation that's eroding your savings.
A bet on sounder economic principles scarcity, decentralization, and technology-driven trust.
Could Bitcoin become a global currency, reshape the financial landscape, and offer everyday people a way to safeguard their wealth?
3 Bitcoin Strategy
This strategy focuses on acquiring 3 Bitcoin, with a balanced approach of secure, long-term holding and active utilization for generating additional Bitcoin.
Offense and defense at the same time — my favorite.
We want to build a safe harbor and then expose a % of our portfolio to risk (via lending) in exchange for accumulating more Bitcoin.
Phase 1: Accumulation
Consistent Investment: Establish a regular investment schedule, allocating a fixed amount of fiat currency to purchase Bitcoin at predetermined intervals (e.g., weekly or monthly). This dollar-cost averaging approach helps mitigate the risk of buying at market peaks.
Cost Optimization: Minimize unnecessary expenses, liquidate equities and utilize excess savings for Bitcoin purchases.
At current prices ($64K) accumulating 3 bitcoin may seem like an arduous task. You look back at $10K bitcoin not long ago and think “I am too late”.
Truly, you may be. If the thesis I explored above plays out I believe Bitcoin will break $400K by mid-2028 and there are scenarios where BTC monetizes much faster than that. There are $1M+ price targets for Bitcoin in 2030 from multiple sources.
Imagine trying to build a war chest with 3 whole bitcoin at $1,000,000 per bitcoin?
Start now.
Phase 2: Secure Storage (2 BTC)
Hardware Wallet: Invest in a reputable hardware wallet to store 2 BTC offline. This provides maximum security against hacking and theft.
Seed Phrase Management: Securely store the seed phrase in a reliable and safe location, preferably offline and in multiple locations. This ensures recoverability in case the hardware wallet is lost or damaged.
This is your Scrooge McDuck money vault. I personally plan on selling 1 of the 2 BTC in this vault when I get to age 50 and want to take wifey around Europe again + buy a beach home in Spain or Italy.
The 2nd and 3rd coins are for my son(s) and daughter(s) to use as the foundation for their journey. Hopefully we can instill success psychology and they inherit their parent’s ambition and discipline. With a 2-coin head start that should set them up for run for getting the family vault up to 10+ Bitcoin.
Phase 3: Active Utilization (1 BTC)
Borrowing & Lending Platforms: Utilize platforms to lend out 1 BTC and earn interest in Bitcoin.
Yield Farming: Explore decentralized finance (DeFi) protocols that offer yield farming opportunities. These platforms allow you to lock up your Bitcoin to earn rewards in the form of other cryptocurrencies or tokens.
Caution: DeFi involves higher risk due to smart contract vulnerabilities and market volatility.
In the past there have been networks that promised to pay you a large yield on your bitcoin… then those platforms collapsed. Some were always fraudulent. Others became fraudulent over time… either way, you MUST do deep diligence.
Before I select my lending platform I will:
speak to management of the platform
speak with current users (ideally more than 3)
speak with at least 3 direct competitors
I will share my findings when I get closer to finishing the accumulation stage!
If any of you are building up a BTC position and are evaluating yield generation options reach out!
This could be the start of taking back some control amidst chaotic times.
🥺 Follow our newly launched video channel Hacking Wealth. This video series focuses on the overlap between wealth and technology.
Wealth is the sum of all the value humanity has created while technology is the engine we've used to build wealth over time. The rate of wealth building is accelerating faster and faster thanks to AI, robotics and rapidly rising tide of technology.
👋 Thank you for reading Wealth Systems. I started this in November 2023 to share the systems, technology, and mindsets that I encountered on Wall Street.
💡The BIG IDEA is share practical knowledge so we can each build and optimize our own wealth engines and combine them into a wealth system.
To help continue our growth please Like, Comment and Share this.
NOTE: The content provided on this blog is for informational purposes only and does not constitute financial, accounting, or legal advice. The author and the blog owner cannot guarantee the accuracy or completeness of the information presented and are not responsible for any errors or omissions or for the results obtained from the use of such information.
All information on this site is provided 'as is', with no guarantee of completeness, accuracy, timeliness, or of the results obtained from the use of this information, and without warranty of any kind, express or implied. The opinions expressed here are those of the author and do not necessarily reflect the views of the site or its associates.
Any investments, trades, speculations, or decisions made on the basis of any information found on this site, expressed or implied herein, are committed at your own risk, financial or otherwise. Readers are advised to conduct their own independent research into individual stocks before making a purchase decision. In addition, investors are advised that past stock performance is no guarantee of future price appreciation.
The author is not a broker/dealer, not an investment advisor, and has no access to non-public information about publicly traded companies. This is not a place for the giving or receiving of financial advice, advice concerning investment decisions, or tax or legal advice. The author is not regulated by any financial authority.
By using this blog, you agree to hold the author and the blog owner harmless and to completely release them from any and all liabilities due to any and all losses, damages, or injuries as a result of any investment decisions you make based on information provided on this site.
Please consult with a certified financial advisor before making any investment decisions.