Chris’ note: As I covered yesterday, we’re experiencing a wrenching shift in investor sentiment. After almost two years of soaring markets, we now have sell-offs in crypto and stocks… plus rising inflation. Then Russia invaded Ukraine. This set off a spike in crude oil and other key commodities, further stoking inflation fears.
In times like these, it’s tempting to seek the perceived safety of cash. But no one ever got rich by sitting around there. So we’re unearthing ways you can turn this crisis into a profit opportunity.
Today, I’m shining the spotlight on a crypto setup our tech and digital assets expert, Jeff Brown, spotted. As you’ll see, the capital flowing into crypto is unlike anything Jeff has seen in his 30-year career as a tech investor. Along with steeply discounted prices, this makes the sector a dream market for contrarian investors…
Now, over to Jeff.
The cryptocurrency market started off 2022 with a whimper.
Since its all-time high last November, bitcoin (BTC) is down about 44%.
Ether (ETH) has fallen 48% from the all-time high it set around the same time.
And the crypto “market cap” – the sum value of all tradeable crypto assets – has dropped by about 41%.
This volatility is hard to stomach.
You may even wonder if this is a sign that life-changing gains in crypto are done.
But today, I’ll ease your worries. I’ll show you how to handle this pullback… and how you can position yourself to profit from the inevitable bounce back.
In crypto, downswings like we’re experiencing are common. They’re also temporary.
Since bitcoin broke $20,000 in late 2020, the crypto market cap has seen nine pullbacks of 20% or more.
Those are a lot of peaks and valleys over a short time.
In the stock market, we call a fall of 20% or more from a peak a bear market.
If we apply that logic to crypto, we’ve entered a bear market nine separate times in just over a year.
But all cryptos fluctuate greatly in value from day to day. So we can’t think of them in the same way we think about stocks.
It’s equally important how fast the crypto market rebounds – even after the biggest falls.
In 2021, after the market cap halved, it rebounded more than 140%.
And it took only about a month and a half for cryptos to break through to new highs.
So don’t let these price swings shake you out of cryptos.
Instead, you should use pullbacks to your advantage by going against the crowd and adding to your positions.
You can see the value of this strategy in the stock market too. Take tech giants Apple (AAPL) and Amazon.com (AMZN) as examples.
Apple is the world’s largest company by market value. It’s worth roughly $2.6 trillion. But before becoming the giant it is today, it had crypto-like volatility.
In the first five years after it went public, Apple saw four drawdowns (peak-to-trough falls) of 50% or more.
Apple investors experienced similar volatility during the dot-com bust in 2000… and the global financial crisis in 2008.
But it’s been more than a decade since Apple has had anything like those kinds of price swings.
And the market has richly rewarded folks who weathered the early days of volatility.
If you bought Apple shares at its IPO (initial public offering) in 1980, you’d be up 123,900% today.
That’s enough to turn every $1,000 grubstake into more than $1.2 million. All it took was patience and perseverance.
It’s a similar story for early Amazon shareholders.
From 1999 through the first half of 2001, they went through 10 drawdowns of 40% or more.
But the last time Amazon investors saw a pullback like that was during the 2008 financial crisis.
And if you rode out the volatility, you’d be up 140,000% from the share price on IPO day. That’s enough to turn every $1,000 grubstake into more than $1.4 million.
Just like early investors in Apple and Amazon, we’re bound to have bone-crunching volatility in crypto.
But if we can hold on through the ups and downs, we’ll have the chance to make the same kinds of life-changing profits.
We’re still in the early stages of the crypto and blockchain revolution.
But the capital flows are unlike anything I’ve seen in my 30-year career as a tech investor.
When venture capital (VC) firms raise large funds, their job is to put that cash to work.
And lately, we’ve seen an influx of fresh VC in crypto and blockchain projects.
Last June, storied Silicon Valley VC firm Andreessen Horowitz raised $2.2 billion for a crypto fund.
In November, Pantera Capital raised $600 million for a new fund. The same month, crypto-focused firm Paradigm raised $2.5 billion.
And in December, crypto-focused private equity firm 10T Holdings announced its plan to raise $500 million for a new fund. This is on top of the $750 million the fund has already raised since its founding in 2020.
Not to be outdone, Andreessen Horowitz came back in January with plans to raise a new $4.5 billion crypto-focused fund.
And former Andreessen partner Katie Haun split from the firm to raise her own crypto fund. She expects to raise about $900 million to invest in crypto and blockchain.
Despite what’s going on with Ukraine… commodities markets… or inflation… this capital needs to go somewhere.
I know it’s tough to seize opportunities when so much bearish sentiment is out there. But we may never see crypto prices this low again.
So if you haven’t already, I recommend you add some bitcoin and ether to your portfolio.
These two blue-chip cryptos will soar again as all that pent-up capital flows into the industry.
It’s also fantastic setup for a secret project I’ve been working on for the past five years.
You see, I’ve built a system that can spot 60-day windows in the crypto market that bring profits as big as six figures.
This system is so powerful, I’ve applied for a patent to protect my intellectual property.
And now, I want to use it to help you profit from crypto’s inevitable bounce back…
That’s why I’m hosting a special event on Wednesday, March 16, at 8 p.m. ET to unveil the details.
So if you’re interested in profiting from crypto… especially strategically trading over a shorter time horizon… please attend.
We’re calling the event Jeff Brown’s Secret Project Perceptron… and I guarantee it will be fun.
I’ll even give away a crypto trade recommendation – for free – during it.
Simply go here to sign up.
Regards,
Jeff Brown
Editor, The Bleeding Edge