Russia is open to taking bitcoin payments…

That’s according to Pavel Zavalny. He’s the head of an energy committee the State Duma – Russia’s version of Congress – has set up.

Last Thursday, at a press conference in Moscow, he talked about the Russian government’s plan to ditch U.S.-dollar payments for oil and gas exports.

This will force “unfriendly” countries to pay for its oil and gas in Russian rubles. And it opens up some creative alternatives for countries that are “friendly” to Russia. Zavalny…

We have been proposing to China for a long time to switch to settlements in national currencies for rubles and yuan. With Turkey, it will be lira and rubles. […] You can also trade bitcoins.

Bitcoin (BTC) is up from about $43,200 on Thursday morning to about $47,400 as I (Chris Lowe) type.

That’s a 9.7% jump.

And as you’ll see today, it’s on its way even higher. As leading crypto expert Teeka Tiwari put it in an email to me earlier, it marks the start of the next phase of bitcoin adoption.

First, a warm welcome to new readers…

We created The Daily Cut to make sure you never miss a big idea on how to grow your wealth from the team at Legacy Research.

It’s the publisher of Teeka, Dave Forest, Nomi Prins, and Jason Bodner.

And one of the biggest ideas we’ve brought to you is the rise of bitcoin and the crypto revolution.

In April 2016, Teeka was the first in our industry to dedicate a major investment advisory – Palm Beach Confidential – to crypto.

Then in 2018, he launched Palm Beach Crypto Income. It’s about how to profit from DeFi (decentralized finance).

And our tech expert, Jeff Brown, has been breaking new ground in crypto, too.

Then earlier this month, he launched an advisory called Neural Net Profits. It uses artificial intelligence (AI) to recommend crypto trades.

Since the start, we’ve focused on adoption…

Whether they admit it or not, most folks buy bitcoin because they see its price rising.

If it then goes down, they panic and sell.

But as Teeka has been coaching his readers, you shouldn’t let day-to-day price changes rule your thinking. Teeka…

The godfather of value investing, Benjamin Graham, taught us to think of “Mr. Market” as a moody teenager. Sometimes, he’s on a high. And he’ll bid up assets beyond their fundamental values. Other times, he’s in a sulk. And he’ll sell the same assets for less than they’re really worth.

And just like with a real moody teenager, you don’t want to give Mr. Market’s whims too much thought.

So when I’m figuring out the future of bitcoin and other crypto, I ask myself, “Are more people using this?” In other words, I look at the rate of adoption. This is the best way to tell if the investment has a future.

It won’t be a straight shot up. But the more people that use bitcoin, the higher its price will go.

Remember, the supply of new bitcoin tapers off over time…

As I’ve covered in these pages, bitcoin is one of the world’s “hardest assets.”

A lot of people think these are assets you can stub a toe on, such as a barrel of oil or a bar of gold.

But a hard asset doesn’t have to be physical. It’s hard in the sense that it’s difficult to produce more of relative to its existing supply.

And bitcoin fits the bill.

Without getting too deep in the weeds, people use computers to “mine” new bitcoins.

That uses a lot of energy. According to Miner Daily, a website about bitcoin mining, it costs between $7,000 and $11,000 to mine one bitcoin.

This continues until we reach a cap of 21 million bitcoins in 2140.

And thanks to a phenomenon known as the “halving,” new supply gets cut in half every four years.


As you can see, this causes supply to flatten off.

And it’s different from other hard assets such as gold…

Both bitcoin and gold have finite supplies. And they’re both expensive to mine.

But unlike with bitcoin, you can increase the rate you mine gold if its price goes through the roof.

That naturally limits the gold price. As new supply comes onstream, prices drop.

That can’t happen with bitcoin. Its supply schedule is set into its code. No matter how high prices go, fewer new bitcoins will come onstream every four years.

So for higher prices, all you need is for higher demand to meet falling supply.

That’s why Teeka’s price target for bitcoin is $500,000 – about 10x where it is now.

The news out of Russia will speed up bitcoin’s ascent…

Think about the big picture…

Bitcoin went live in 2009 with a value of zero.

Only computer nerds and hardcore libertarians saw any promise in it.

The first recorded bitcoin purchase didn’t happen until 2010.

Programmer Laszlo Hanyecz spent 10,000 bitcoins on two pizzas. Back then, his bitcoins were worth $40.

Now, we’re seeing a member of the G20 – a club of the world’s most powerful nations – talk about accepting bitcoin in exchange for valuable oil and gas exports. These are potential purchases worth billions of dollars.

More from Teeka…

This is absolutely the next phase of adoption. I’ve always said the world needs a truly neutral, independent source of value it can trade in. That independent source of value is bitcoin.

It’s permissionless – meaning anyone can use it. And it’s liquid. Bitcoin trades 24 hours a day, seven days a week. It’s also tamperproof and stateless. That sounds like a perfect monetary base layer to me.

Russia won’t be the last country to turn to bitcoin for trade…

There’s a long line of other countries that don’t like having to depend on the U.S. dollar to settle trade in.

Not only does it give the U.S. an economic advantage to have a currency everyone needs before they can trade with other nations… It also makes them vulnerable to Washington financially “canceling” them, like it’s done to Russia.

Don’t forget, one of the reasons Russia is looking to alternative ways to settle trade is that the U.S. and its allies have frozen its assets and sanctioned its central banks.

That’s why Teeka says now is a great time to buy bitcoin. As demand – including demand from governments – rises, prices can only go higher…

Russia’s news makes it clear that bitcoin will play a major role in the years ahead. If you don’t own any, you must act now and add it to your portfolio immediately.

Just remember that Teeka recommends you allocate no more than 10% of your overall portfolio to bitcoin.

He also urges you to take a long-term view. We won’t see a new bitcoin standard develop overnight. And there’ll be plenty of volatility on the way to $500,000 bitcoin.



Chris Lowe
March 28, 2022