Chris’ note: The rise of the crypto economy is one of the biggest profit trends we track here at the Cut. We recommend all our readers own at least a small ($200 to $400) grubstake in bitcoin.
That’s why today we hear from my friend and world-renowned cryptocurrency investor Teeka Tiwari. He predicted 2020 would see a surge in bitcoin due to Wall Street greed. And as he reveals below, that narrative is gaining momentum.
Teeka’s crypto recommendations have been on fire lately. One was up 1,493% after just six weeks. And his best pick to date would have turned a small $500 stake into $784,265. That’s a whopping 156,753% gain.
Find out more about his next big pick here. Then read on below for why the window to profit from this asymmetric opportunity won’t last long.
Over to Teeka…
For years, I’ve been telling my readers there’s a new narrative emerging on Wall Street.
This story is still being written… and it won’t be finished overnight. But it’s unfolding in front of your eyes.
In January 2019, I said it would be the year of Wall Street greed.
This was right on the heels of the brutal 2018 “Crypto Winter” bear market. Here’s what I wrote back then…
2017 was the year of individual greed. That year, we saw a massive bull market driven almost entirely by individuals. It wasn’t possible for most institutions to get into the crypto market then.
Then, 2018 was the year of individual fear… We saw the markets pull back in a big way. And that leads me to my crypto theme of 2019… It will be the year of institutional greed.
You see, despite the 2018 bear market, Wall Street institutions continued to lay the groundwork for crypto adoption. And despite the naysayers… I knew this trend was here to stay.
In 2020, my narrative is gaining momentum…
One reason I said institutions would put bitcoin into their portfolios is it improves their overall performance.
You see, cryptos are uncorrelated to the markets.
In other words, their movements aren’t tied to the stock market or overall business cycles.
And Wall Street is realizing the price of bitcoin is unrelated to the prices of gold, stocks, bonds, or commodities.
Here’s why that’s valuable to them…
A study by Bitwise Asset Management showed that putting just 1% to 10% of your portfolio into bitcoin provides better risk-adjusted returns than holding just stocks and bonds.
That potentially makes bitcoin Wall Street’s “Holy Grail” – an uncorrelated asset performing well under diverse market conditions that improves performance, while lowering volatility across an entire portfolio.
Now, this doesn’t mean we won’t see rare occasions when bitcoin moves in the same direction as other assets.
We saw this happen in the depths of the COVID-19-related sell-off in March 2020. There was a big drive to create liquidity to meet margin calls… and nearly every asset – including bitcoin – sold off.
But outside of that, there’s little correlation between bitcoin and other assets.
That’s why we’re seeing big-money men like Paul Tudor Jones buying bitcoin.
Tudor Jones is the founder and CIO of Tudor Investment Corporation. It manages about $40 billion.
And he’s personally worth over $5 billion.
Last month, he announced he’s putting up to 2% of his personal portfolio into bitcoin.
I believe big-money men like Paul Tudor Jones have done their research. And they see bitcoin as an uncorrelated asset with phenomenal potential upside.
Think about it this way…
If you have a $1 million brokerage account with a traditional 60/40 split of stocks and bonds, why wouldn’t you allocate 2% to bitcoin?
If your hypothetical $20,000 position goes to zero, it doesn’t affect your net worth. The income you get on your stocks and bonds will more than make up for the loss.
But say bitcoin goes up 10x. Your $20,000 balloons to $200,000. And your $1 million portfolio grows to $1.2 million.
Growing your portfolio by 20% by risking only 2% is unheard of. But that’s the opportunity in bitcoin right now.
Think of the impact on Tudor Jones’ net worth if bitcoin goes up 10x. He could see his $5 billion net worth grow to $6 billion by risking only 2% of it.
I’m wagering many more big-money guys are going to make the same bet.
The asymmetric opportunity in bitcoin won’t last forever.
Once it becomes a multitrillion-dollar asset class, forget about 10x returns. The rate of growth will slow just like it has for once high-flying but now mature stocks such as IBM, Intel, and Oracle.
This window of opportunity is closing much faster than you might imagine…
A recent survey by Fidelity Investments revealed that 36% of institutional investors in the U.S. and Europe are invested in cryptos. Looking ahead five years, 91% said they’re open to exposure to digital assets in a portfolio.
Think about that… It was unheard of in 2016 that 91% of institutions would consider adding bitcoin to their investments.
When I pull back the camera, I see a future where managers adjust the traditional 60/40 asset allocation model to include a 2% allocation for bitcoin.
This process of bitcoin adoption by institutions will be a huge tailwind for the entire space.
Bitcoin is the gateway to the rest of the crypto market.
After someone gets their feet wet with bitcoin, they move into Ethereum, and then into smaller “altcoins” (any crypto other than bitcoin).
So what’s good for bitcoin is good for the entire crypto market.
What I’m sharing with you today is concrete proof the investment world is moving into alignment with my narrative of bitcoin adoption.
Bitcoin is becoming a core holding of money managers – and, in time, will be held by virtually all money managers.
Helping this adoption along will be Wall Street’s marketing machines. After all, it’s had to sit back and watch its fintech rivals like Binance and Coinbase make billions in fees without it.
Wall Street is coming for those profits, and I won’t bet against Wall Street’s greed. I fully expect Wall Street to engage its global marketing machines to promote the virtues of diversification via bitcoin, so it can shepherd millions of customers into high-fee bitcoin-trading products.
We’re at the start of the biggest allocation of capital to a new asset you’ll see in your lifetime.
But don’t just rely on me. Rely on Wall Street’s greed… Rely on the relentless self-interest of money managers… Rely on the profit motive of big-money institutions.
That’s what I’m asking you to believe in. That’s what I’m asking you to put your faith in.
Let the Game Come to You!
Teeka Tiwari
Editor, Palm Beach Confidential
P.S. Tomorrow, I’m releasing my next BIG pick…
If it’s anything like my picks in the past, it could send you on the path to financial freedom. Just a $100 stake in each of my 10 best picks could’ve handed you $201,610.
But you need to hurry… Prices of the best cryptos will never be this cheap again.
It’s all thanks to a strange event I’ve discovered… And no one is talking about it. Click here to learn more.