He founded Xapo, a Bitcoin custodian in 2014.
He's also a board member at Libra, PayPal, and Kiva.
But most importantly, he's responsible for bringing thousands of people into Bitcoin.
I'd recommend his podcast with @laurashin
This is the argument for a 5% allocation to Bitcoin.
It’s a summary of Wences Casares’ blog post written nearly two years ago (with direct quotes copy pasted).
Part one: Why Bitcoin could hit $1 million
Part two: Why you should buy Bitcoin
Here we go! 👇👇👇
He founded Xapo, a Bitcoin custodian in 2014.
He's also a board member at Libra, PayPal, and Kiva.
But most importantly, he's responsible for bringing thousands of people into Bitcoin.
I'd recommend his podcast with @laurashin
Bitcoin right now is similar to the Internet in 1994.
You don't need to know how the Internet works to understand it.
You don't need to know how Bitcoin works to understand it.
Investors who understand this will have an advantage over investors who don't.
Those platforms had to obey the will of their owners and the rules of the jurisdiction where they resided.
Bitcoin takes control away from the owners.
Kings and Queens used to be sovereign.
Then nation states became sovereign.
Now, for the first time, a computer platform has the aspiration to be sovereign.
This is revolutionary.
Miners secure it because they get paid in Bitcoin to do so.
If you were to remove the Bitcoin, miners would stop mining and Bitcoin would not be very robust nor sovereign.
Use Bitcoin to run a global system of value and settlement.
This is no different than what gold was for 2,000 years and or what the US dollar has been for the last 70 years.
Why?
a) 21M Bitcoin hardcap
b) Bitcoin is open and uncensorable
This allows for unprecedented economic freedom similar to how the internet allowed for freedom of information.
Gold has the advantage that it is tangible and many people (especially boomers) prefer assets they can touch.
Gold also has in its favor that it has been around for over 2,000 years, and it may be impossible for Bitcoin to match that history and reputation.
The dollar has the advantage that it is already understood and accepted globally and it is a platform with remarkable network effects.
Or it may be that we collectively come to appreciate the advantages of a digital unit that cannot be inflated or censored.
Only time will tell.
That’s correct.
Most forms of good money have no intrinsic value.
The main hurdle Bitcoin has to clear is to develop a similar social perception of value.
It may be a supranational currency that exists on top of all national currencies.
In other words, it could become a global non-political standard of value and settlement.
When your granddaughter asks what is the price of the New Zealand dollar she may receive an answer in satoshis: the New Zealand dollar is 72 satoshis today.
The US dollar? 107 satoshis
A barrel of oil? 5,600 satoshis today
The GDP of Indonesia? 1,417,007 Bitcoin
You get the idea.
Then all of these values would be easily comparable across time and across geographies.
You: We used the US dollar.
Granddaughter: But isn’t that the currency of the United States?
You: Yes
Granddaughter: But then how did you keep track of the US dollar?
She will think we were weird.
Once a protocol gets established it almost never changes.
We only use one web protocol and one email protocol.
Right now it looks like the standard protocol for a sovereign platform will be Bitcoin.
The Bitcoin price rallies are Bitcoin’s best moments but they are also its most dangerous and vulneread the word and how more people want to own it.
The Bitcoin price rallies are Bitcoin’s best moments but they are also its most dangerous.
During the rally too many people buy too many Bitcoin thinking that they will be able to sell them for a big gain very soon.
Usually that does not happen.
Anyone who tells you that they know what the price of Bitcoin will be next week is either ignorant or outright lying to you.
It's best to dollar cost average.
First, Bitcoin is not guaranteed to succeed.
But the numbers and amount of investment and activity in the space sure point to its success.
Wences put Bitcoin's chance of success in 2019 at 50%+.
And a lot has happened since then!
That is 30x what it’s worth today ($30k).
Based on this, you should allocate 5% to Bitcoin.
*Wences used 1% when Bitcoin was at $4,000*
$10M portfolio invests $500,000 (5%).
If Bitcoin fails, this portfolio will lose $500,000, or 5% over the next 3-5 years.
If Bitcoin succeeds, that $500,000 will grow to more than $15M.
It’s nearly impossible to find an asset that is so misplaced and where possible outcomes are so asymmetrical.
Bitcoin offers a unique opportunity for a 5% exposure to produce a life changing outcome.
But it would be almost as irresponsible to not have any exposure at all.
Follow me for more threads like this one: @JasonYanowitz
And most importantly...
Go read the actual post by Wences! It's much better than this summarized thread.
https://t.co/TLLOf1BBIj
More from Crypto
Excited to share our 2020 #Bitcoin review.
2020 will be remembered as the year the long fabled institutions finally arrived and #Bitcoin became a bonafide macroeconomic asset.
Below are the top highlights of each month for Bitcoin’s historic year.
1/
Bitcoin is now at all-time highs capping off an extremely successful year.
But it was by no means stable ride up.
2020 was a historically volatile year.
@YoungCryptoPM and I provided a detailed overview of every month of 2020 in all its
Jan.
3 days into the new year the US assassinated Iran’s top general Soleimani.
BTC surprisingly reacted to the events behaving like a safe haven as the risk of war increased.
The events provided the first hints of BTC potentially having graduated to a legitimate macro asset.
Feb.
COVID-19 reached a tipping point causing markets to crash.
BTC’s correlation with the S&P 500 reached an ATH in the following weeks.
This is when everyone learned BTC was not a recession hedge, it was a hedge against inflation and loss of confidence in fiat currencies. https://t.co/JB7dJ3qp6M
Mar.
Financial markets in free fall.
The liquidity crisis was so severe BTC experienced one of it’s worst days ever.
Now known as Black Thursday, on March 12, BTC plummeted as much as 50% to below $4,000 at its lowest point on the day.
BTC closed the day down 40%
2020 will be remembered as the year the long fabled institutions finally arrived and #Bitcoin became a bonafide macroeconomic asset.
Below are the top highlights of each month for Bitcoin’s historic year.
1/
Bitcoin is now at all-time highs capping off an extremely successful year.
But it was by no means stable ride up.
2020 was a historically volatile year.
@YoungCryptoPM and I provided a detailed overview of every month of 2020 in all its
Jan.
3 days into the new year the US assassinated Iran’s top general Soleimani.
BTC surprisingly reacted to the events behaving like a safe haven as the risk of war increased.
The events provided the first hints of BTC potentially having graduated to a legitimate macro asset.
Feb.
COVID-19 reached a tipping point causing markets to crash.
BTC’s correlation with the S&P 500 reached an ATH in the following weeks.
This is when everyone learned BTC was not a recession hedge, it was a hedge against inflation and loss of confidence in fiat currencies. https://t.co/JB7dJ3qp6M
1/ Figure I should get out ahead of this issue:
— Dan McArdle (@robustus) June 22, 2018
Bitcoin is a hedge against inflation & loss of confidence in fiat, NOT a hedge against a typical recession.
Mar.
Financial markets in free fall.
The liquidity crisis was so severe BTC experienced one of it’s worst days ever.
Now known as Black Thursday, on March 12, BTC plummeted as much as 50% to below $4,000 at its lowest point on the day.
BTC closed the day down 40%
2020 was a game changer for Ethereum.
The vast majority of its success was fueled by #DeFi.
Here's what happened in 5 Tweets 🔽
1) Governance Tokens 🪙
Projects gave complete ownership of billion dollar protocols to their users, often using retroactive airdrops.
Early adopters earned tokens for past usage, and token-based voting now dictates all technical
2) Liquidity Mining ⛏️
Power users were the first to earn on-going distribution by providing liquidity.
$COMP sparked the wave, with $BAL coining the term a few weeks
3) Yield Faming 🌾
Projects coupled liquidity mining and governance tokens to boost 'yields' by combining lending rates with an incentive layer.
APYs peaked as high as 1M% during 'DeFi summer', leading to a 'food coin' craze like $YAM and
4) Fair Launches ✅
Who needs investment when you can launch using yield farming?
@iearnfinance debuted $YFI with no formal funding, seeding a community treasury for self-sustainability.
The notion of a core team and community became one and the
The vast majority of its success was fueled by #DeFi.
Here's what happened in 5 Tweets 🔽
1) Governance Tokens 🪙
Projects gave complete ownership of billion dollar protocols to their users, often using retroactive airdrops.
Early adopters earned tokens for past usage, and token-based voting now dictates all technical
It pays to be a web3 power user.
— Coopahtroopa \U0001f525_\U0001f525 (@Cooopahtroopa) December 9, 2020
Five networks that issued retroactive airdrops to value added actors \U0001f4dd
2) Liquidity Mining ⛏️
Power users were the first to earn on-going distribution by providing liquidity.
$COMP sparked the wave, with $BAL coining the term a few weeks
BAL is live!
— Balancer Labs (@BalancerLabs) June 23, 2020
The 435k BAL for liquidity providers of the first three weeks of liquidity mining (145k per week) have just been sent out to the wallets used to provide liquidity on Balancer.https://t.co/pkXFzwzPVC
3) Yield Faming 🌾
Projects coupled liquidity mining and governance tokens to boost 'yields' by combining lending rates with an incentive layer.
APYs peaked as high as 1M% during 'DeFi summer', leading to a 'food coin' craze like $YAM and
Check out @Cooopahtroopa's latest post for all the #DeFi farmers out there \U0001f468\u200d\U0001f33e
— Zerion \U0001f3e6 (@zerion_io) June 26, 2020
Turns out @synthetix_io & @CurveFinance were ploughing the fields long before $COMP & $BAL came along.
Learn how to put your #crypto to work with this #yieldfarming 101 \U0001f4b8
\U0001f449 https://t.co/zYUKtqx3BK
4) Fair Launches ✅
Who needs investment when you can launch using yield farming?
@iearnfinance debuted $YFI with no formal funding, seeding a community treasury for self-sustainability.
The notion of a core team and community became one and the
2/ What is a Fair Launch?
— fair launch capital (@fairlaunchcap) August 26, 2020
A FL enables founders to bootstrap new crypto networks that are earned, owned, and governed by their community from the outset.
In this dynamic, everyone participates on equal footing\u2014there is no early access, pre-mine, or allocation of tokens.
1/ @MIT discussing the need for blockchain gateways to achieve interoperability across different blockchain networks, and to support the cross-blockchain mobility of virtual assets
https://t.co/PbjQkSlTT3
@quant_network are collaborating with MIT in the creation of ODAP
$QNT
2/ "In order for blockchain-based services to scale globally, blockchain networks must be able to interoperate with one another following a standardized protocol and interfaces (APIs)"
Gilbert founded ISO TC307 which 60 countries are working towards standardizing the interfaces
3/ "We believe that a blockchain gateway is needed for blockchain networks to interoperate in a manner similar
to border gateway routers in IP networks. Just as border gateway routers use the BGPv4 protocol to interact with one another in a peered fashion we believe that a...
4/ blockchain gateway protocol will be needed to permit the movement of virtual assets and related information across blockchain networks in a secure and privacy-preserving manner"
You can read more about the gateway protocol ODAP in this 21 tweet
5/
"We motivate the need for blockchain gateways and blockchain gateway protocols in the following summary:
✅Enables blockchain interoperability:
Blockchain gateways provide an interface for the interoperability between blockchain/DLT systems that operate distinct consensus...
https://t.co/PbjQkSlTT3
@quant_network are collaborating with MIT in the creation of ODAP
$QNT
2/ "In order for blockchain-based services to scale globally, blockchain networks must be able to interoperate with one another following a standardized protocol and interfaces (APIs)"
Gilbert founded ISO TC307 which 60 countries are working towards standardizing the interfaces
3/ "We believe that a blockchain gateway is needed for blockchain networks to interoperate in a manner similar
to border gateway routers in IP networks. Just as border gateway routers use the BGPv4 protocol to interact with one another in a peered fashion we believe that a...
4/ blockchain gateway protocol will be needed to permit the movement of virtual assets and related information across blockchain networks in a secure and privacy-preserving manner"
You can read more about the gateway protocol ODAP in this 21 tweet
See this 21-tweet thread about the creation of an Internet scale protocol to move digital assets involving Quant, MIT, US Government, Intel, Juniper, Payment and Telecom companies \U0001f447https://t.co/n7VGIIlAvq pic.twitter.com/mTUEmCMFZM
— Seq (@CryptoSeq) December 22, 2020
5/
"We motivate the need for blockchain gateways and blockchain gateway protocols in the following summary:
✅Enables blockchain interoperability:
Blockchain gateways provide an interface for the interoperability between blockchain/DLT systems that operate distinct consensus...
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I wish I had this... — don't excuse yourself. Forget about what you can't and focus on what you can.
Stop comparing yourself to others, come from the point of what you have, know and have: "I can... so I will do..!" #MyMindset
BTW this was an update of one of the previous tweets. And I'm continuing this thread today!
Do something for the long-term. Everything else is a distraction. 🛑 Nowadays I always check if the thing I'm doing aligns with my long-term plans. If not — that is probably not the best thing to do at the moment. #MyMindset
The only way to get more done is to have less to do. Eliminate your obligations, say "no" to things that are not important, stay minimal in what you do, focus. Being busy is not equal to getting things done. #MyMindset
I wish I had this... — don't excuse yourself. Forget about what you can't and focus on what you can.
Stop comparing yourself to others, come from the point of what you have, know and have: "I can... so I will do..!" #MyMindset
BTW this was an update of one of the previous tweets. And I'm continuing this thread today!
Focus only on positive things! These include what *you* have, know and can do. If you don't have, know or cannot do something either get it or ignore it. Don't think about it and don't use it as an excuse.
— Gleb Sabirzyanov (@zyumbik) October 17, 2018
I've been struggling to follow this principle for a long time. #MyMindset pic.twitter.com/SK5vtwHs3G
Do something for the long-term. Everything else is a distraction. 🛑 Nowadays I always check if the thing I'm doing aligns with my long-term plans. If not — that is probably not the best thing to do at the moment. #MyMindset
The only way to get more done is to have less to do. Eliminate your obligations, say "no" to things that are not important, stay minimal in what you do, focus. Being busy is not equal to getting things done. #MyMindset
