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HEALTH, WEALTH, AND HAPPINESS

Feb 9, 2022

"Honesty is the first chapter in the book of wisdom."

- Thomas Jefferson

New downloadable scorecard! Litecoin (LTC) was one of the first alternatives to bitcoin, but has recently been eclipsed by newer and sexier tokens.

Is "bitcoin lite" still worth a look? Our analysts created this new one-page investor guide to Litecoin. Click here to download.

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Beijing’s Digital Currency Push at Winter Olympics Puts Visa in a Bind (Wall Street Journal): Consider this a sign of things to come. China's new digital currency, the e-CNY, is accepted anywhere inside the Olympic bubble. But Visa paid big bucks to be be the exclusive sponsor of electronic payments at the Olympics.

Investor takeaway: We've reported on China's global leadership in developing its own digital currency, which is now ready for Olympic-sized crowds. Central Bank Digital Currencies (CBDCs) will surely eat into the market share of Visa and other payment providers, unless they're able to offer new crypto products of their own.

China is so far ahead of the rest of the world in developing a digital currency that smart investors might consider adding a China-focused fund to their portfolio. Vanguard plans to have one soon.

The price of Visa stock rose from $207 to $231 over the past year: a 12% increase.

While the price of ETH, the blockchain platform for a new generation of financial services, has increased from $1744 to $3249: an 86% increase

Investor takeaway: In terms of speed and cost, there's no question that Visa has the better payment product. Still, the amount of money pouring into Ethereum suggests that people believe in its future more than Visa.

Before investing in Visa, ask yourself: does Visa have a credible crypto strategy?

How did they get caught?

So based on the information that is available, here is how they got caught.

The partners in crime allegedly laundered nearly 120,000 bitcoin stolen from Bitfinex’s platform in 2016 after a hacker breached the exchange’s systems and initiated more than 2,000 unauthorized transactions.

Federal prosecutors allege that by harnessing software programs, the transactions quickly automated the movements of bitcoin in order to obfuscate their origin, which resulted in a portion of the amount stolen ending up in financial accounts tied to the couple. 

Further, the two alleged criminals are believed to have the ability to get their hands on over $300 million in additional bitcoin, according to U.S. Attorney Maggie Lynaugh. 

It is simply not feasible to launder billions of dollars of bitcoin and get away with it. While this won't go down as one of the dumbest crimes in history, there were definitely a few things the couple didn't seem to think through. 

So much for bitcoin being a great way to launder money. And not that I am suggesting any of you would do such a thing, but remember that the blockchain is designed to provide a permanent, transparent record of all transactions.

Green is good

Aside from the sensationalism and jokes on Crypto Twitter, it has been a fantastic week for digital currencies. Bitcoin was up 18% over the last week at the time of this writing, and all the top 20 digital currencies had risen during this time frame. 

This is some welcome relief for crypto bulls, after a brutal January that saw bitcoin drop 20%. 

UNUS SED LEO had a particularly great day yesterday, rising 50% on the hopes that Bitfinex would receive money back from the DOJ and use it to buy back and burn LEO tokens.

This time, it's definitely a case of the saying "buy the rumor, sell the news." The wheels of justice are slow, and in the unlikely case that the U.S. government simply hands over the bitcoin, the process is likely to take months or years.

In recent weeks, I have published 3 Reasons to be Bearish and 3 Reasons to Be Bullish in 2022, two different blogs with counterpoints on why I am bullish and why I am not.

These are a deeper dive into some factors I see affecting the market, but either way they go, there is one sector in crypto I see winning in the long run.

Investors' take

When markets drop, some will panic sell, others will buy the dip, and many will simply HODL their bitcoin and other digital assets that they have researched and decided to retain.

Want to generate significant income in crypto without being a trader or a nefarious criminal willing to hack and launder billions? The solution is DeFi.

Is crypto too volatile or boring for you? The answer, once again, is DeFi. 

The long-term HODLers (like me) who have chosen the coins they plan to hold, come hell or high water, are going to stay put. 

Here are some other things you can do with DeFi:

1) Hold your crypto and get more crypto.

2) HODL your crypto, take the interest as passive income.

3) Never sell your crypto, when you need money, take out a loan and pay it back. This prevents the taxable event of the sale. 

4) Hold stablecoins in a down market so you can buy dips.

5) Borrow against your stablecoins to buy the dips.

There is a place for DeFi in every bull market and bear market. Just like all of investing and crypto, risk and reward go together, and this is not a solicitation to buy any specific cryptocurrency. But here are some DeFi products I have checked out:

Nexo Finance - It's a wallet that also has a token called NEXO. This was one of the first places Americans could get loans and earn interest on crypto or stablecoins. They started with stablecoins, but they now offer support for 22 cryptocurrencies.

You can even earn interest on PAX GOLD, a cryptocurrency pegged to the U.S. dollar price of gold. I have been a happy user for years and hold their tokens. Further, I have received commissions for referring people to their platform.

Celsius is another platform that offers a similar business model. I have not used it personally, but I have heard a lot about from satisfied customers. Most Americans can take advantage of these services, depending on state regulations. 

Aave - Built on Ethereum, Aave means "ghost" in Finnish. It is one of the first projects in DeFi to offer "flash loans" where you can obtain unsecured loans to take advantage of market opportunities.

You can also get interest loaning crypto or borrowing digital currency using AAVE tokens. They also have markets for AVAX and MATIC.  It currently has a liquidity pool of over $24 billion and growing, per aave.com.

CAKE - This is the token that powers the Pancake Swap decentralized exchange. This is the main decentralized exchange for the Binance Smart Chain.

The exchange itself offers staking interest, and so do numerous centralized exchanges and wallets. For investors who want exposure to DeFi and the Binance Smart Chain, this is an option to consider. 

Caution - there seem to be hundreds of other DeFi projects out there. While I certainly haven't looked into all of them, I want to offer one word of caution. If it seems to good to be true, it probably is.

One platform, Safuu, claims to offer a yield of 382,945% APY. I don't need to look any further to tell you that doesn't sound very "safuu" at all! 

Make it a great day!

Sincerely,

Alexandre Lores

Opportunity Analyst

The race for global central banks to acquire bitcoin is going to be fabulous.

Bitcoin Market Journal is a daily newsletter that makes you a better crypto investor. It is created by Evamarie Augustine, Charles Bovaird, Mati Greenspan, John Hargrave, and Alexandre Lores.

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