As the UK’s economic meltdown continues, investors need to ask, who is next?
The risk of this monetary contagion spreading is now a very real problem. Europe knows all too well how quickly one nation’s problem can become a region-wide issue.
As I explained in yesterday’s Money Morning, though, the one silver lining is that the Brits at least have options this time around. Bitcoin [BTC] and other cryptocurrencies provide an alternative way to hold onto wealth as the UK government and Bank of England (BoE) set about destroying it…
That’s why bitcoin purchases in pounds are soaring as of late. And if more central bankers follow in the UK’s footsteps, don’t be surprised if we see other nations follow suit.
As billionaire investor Stanley Druckenmiller commented on the BoE’s moves:
‘It’s tough for me to own anything like that [bitcoin] with central banks tightening. I still think if the Bank of England what they did is followed by other central banks in the next two or three years if things get really bad, I could see cryptocurrency having a big role in a renaissance because people just aren’t going to trust the central banks.’
For long-time crypto followers, this insight is hardly any startling revelation.
The whole point of bitcoin is that it was designed to be an answer to the central bank incompetence that led to the ‘08 crash. That’s why we need it, and that’s why bitcoin will always be relevant.
Adoption all around the world
The biggest surprise this week for bitcoin, in my view anyway, is how adoption continues to grow.
In the US, we’re seeing more ‘buy-the-dip’ mentality from some big Wall Street names. Fidelity’s Wise Origin Index Fund, for example, recently declared it had purchased a further US$62.84 worth of bitcoin.
That’s a great sign for investors that a lot of the big money is still keeping a close eye on crypto. Not to mention the fact that a lot of the bigger institutions may never fully document how much they’re buying or selling.
Even more impressive than this is the growing use of bitcoin in Sub-Saharan Africa. Because while the transactions aren’t moving huge sums, it is showcasing how valuable cryptocurrencies can be for less stable monetary regions.
As a Chainalysis report notes on the boom:
‘Our interviews suggest that this reflects the trend of many young people in Sub-Saharan Africa turning to cryptocurrency as a way to preserve and build wealth in spite of low economic opportunity, as opposed to other countries where we see many using cryptocurrency as a way to multiply their existing wealth.
‘Adedeji Owonibi, founder of Nigeria-based blockchain consultancy and product studio Convexity, told us more about this dynamic. “We see a lot of daily traders who are trading to make ends meet,” he said. “We don’t have big, institutional-level traders in Sub-Saharan Africa. The people driving the market here are retail. Nigeria has a ton of highly educated young graduates with high unemployment rates, no jobs available — crypto to them is a rescue. It’s a way to feed their family and solve their daily financial needs.”’
If you’re a bitcoin maximalist, this is the kind of development you really want to see.
It is just further evidence that for the billions of people living under questionable economics, at least bitcoin can be relied upon for what it is. It is the only transparent and fully decentralised alternative for those who need it…
The road to US$1,000,000 bitcoin
All of this is to say that if you don’t already own some bitcoin, you probably should.
I’m not saying you need to put your life savings into it, but rather just a small portion of your portfolio. Just like any investor would with a mix of assets.
Because as our in-house crypto expert, Ryan Dinse, is seeing, we’re coming to a turning point for bitcoin. As he told his subscribers yesterday, one key indicator that has historically marked the bottom of the bitcoin down cycles has already been passed. If history repeats itself once more, the next bitcoin bull market may have just begun…
In Ryan’s own words:
‘In 2014, the bottom came six days before the cross.
‘In 2018, the bottom came four days after the cross.
‘This time, it crossed on 22 September (last Thursday), with the price low being US$18,365 on that date. No doubt, there’s been a nice bounce in price since.’
So the real question is, how high could bitcoin go this time around?
Well, if you ask Ryan, we very well could see bitcoin reach a value of US$1,000,000 by the end of the decade. And while that may sound unreasonable or hyperbolic to you right now, this digital currency has always found ways to surprise people when it booms.
For this reason, Ryan is busily preparing his timeline for how and when bitcoin reaches the milestones required to top one million US dollars. It’s something that he has been working on for a while now, and he’s excited to share it with Money Morning readers in the coming days.
I can tell you right now, whether you’re a bitcoin believer or sceptic, it is worth hearing what he has to say. Keep your eyes peeled on our updates to come because we’ll have plenty to share on this front very soon.
Until then, all eyes are on bitcoin for the next big breakthrough.
Regards,
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Ryan Clarkson-Ledward,
Editor, Money Morning
Ryan is also co-editor of Exponential Stock Investor, a stock tipping newsletter that hunts down promising small-cap stocks. For information on how to subscribe and see what Ryan’s telling subscribers right now, click here.
