Welcome to this week’s edition of the Myth of Money, a weekly newsletter on all things money, economics and technology read by 10,000+ subscribers, curated by Tatiana Koffman.
Disclaimer: The following is not intended as investment advice. Do your own research.
As Bitcoin receives more and more attention, my inbox is full of requests asking for the best ways to actually buy and store Bitcoin. In this edition of the #MythOfMoney, I break down some of the options available based on your goals.
(1) Retail Purchase
At the retail level, the easiest way to enter the market is through a crypto exchange. It is not the most friendly in terms of fees, but it is fast and relatively secure. Link your bank account for easy Wire or ATH transfers.
My two favorite exchanges are:
(1) Coinbase (US purchases), and
(2) Binance (non-US purchases)
[If you are new to these platforms, use the links above to get a discount on your trading fees 🙃]
(2) Institutional Purchase
If you are buying larger amounts, I highly recommend engaging with a trading desk to perform the transaction for you. The biggest advantage here is price stability. Making a $1M+ purchase can significantly move the market. An experienced trading desk will make smaller purchases across several exchanges and OTC markets, making sure you get the best average price. The desk will also offer storage solutions, should you decide to self-custody.
There are several reputable desks out there. One firm that I’ve worked closely with in this regard is Secure Digital Markets. Their team of experienced traders can execute a Bitcoin purchase for you at spot prices to avoid those pesky fees. [Contact me directly for an introduction to get the “white-glove treatment.”]
(3) Publicly Traded Funds
For those of us based in Canada or the U.S., taxes will significantly impact your profits. For this reason, I often recommend purchasing publicly traded funds within your retirement or tax-free accounts.
A few options:
Grayscale Bitcoin Trust (GBTC) - Price $17.96 - Market Cap $9.35B
3iQ Bitcoin Fund (QBTC) - Price $21.51 - Market Cap $180M
Grayscale Ethereum Trust (ETHE) - Price $63.56 - Market Cap $1.66B
These vehicles will reflect the value of the underlying asset but will charge a fee of 2% and often trade at a premium. I recommend these funds as a tax-mitigation strategy only.
This Week By the Numbers
Piggy-backing on positive vaccine news - oil, yields and small cap stocks rallied, while tech stocks remained flat. Even though the American economy is struggling to recover and is still down 10 million since the pandemic started, the S&P 500 advanced to 3,585.15, and posted a record closing high. Bitcoin reached another 2020 all time high at $16.5k finishing the week at $15.9k. Investors continue to pile into digital assets amid growing economic uncertainty.
Billionaire Hedge Fund Investor Druckenmiller Says He Owns Bitcoin in CNBC Interview
Billionaire U.S. investor Stanley Druckenmiller, who just weeks ago was said to be shorting the dollar, is long on bitcoin. Druckenmiller becomes the latest high-profile, ultra high-net-worth investor to get in on the benchmark digital currency. Though he said his gold position is "many, many more times" larger than his bitcoin allocation, Druckenmiller predicted his bitcoin would outperform. "Frankly, if the gold bet works, the bitcoin bet will probably work better because it's thinner, more illiquid and has a lot more beta to it…It has a lot of attraction as a store of value to both millennials and the new West Coast money and, as you know, they have a lot of it." Druckenmiller also said he's anticipating a three- to four-year decline in the dollar. Read Full Story.
The economy as we knew it might be over, Fed Chairman says
The Covid-19 pandemic brought the economy to a screeching halt, and while it has started its long road to recovery, the economy we knew is probably a thing of the past, said Federal Reserve Chairman Jerome Powell. The pandemic has accelerated existing trends in the economy and society, including the increasing use of technology, telework and automation. This will have lasting effects on how people live and work. Lower-paid workers, as well as those in jobs requiring face-to-face interactions, such as retail or restaurant workers, will shoulder most of the burden of this shift. These groups, heavily skewed towards women and minorities, have already been among those most affected by pandemic layoffs.The post-pandemic economy is also at risk of being less productive: women have been forced to quit their jobs due to child care responsibilities during the crisis. Read Full Story.
US Representatives Rip OCC, Brooks for ‘Excessive Focus’ on Crypto
Several U.S. lawmakers are displeased by the Office of the Comptroller of the Currency and its focus on crypto and fintech during a pandemic-caused recession. Six members of Congress faulted the banking regulator’s stance on crypto custody and stablecoin services, as well as its plans to offer a fintech charter, in a sharply worded letter Tuesday that questioned whether Acting Comptroller Brian Brooks has his priorities straight during COVID-19’s health and economic crises. They blasted OCC’s “unilateral actions” as short-sighted calls they said could put “the entire hierarchy” of dollar-denominated financial assets at risk. Read Full Story.
NASA Says Galaxy Could Have At Least 300 Million Habitable Planets
Following a nine-year mission that ended in 2018 when it ran out of fuel, NASA's Kepler Space Telescope identified approximately 300 million planets that could be habitable within the Milky Way. An updated analysis, which was first printed in the Astronomical Journal, attempted to put into perspective how many of these places could sustain life. Putting forth what was deemed a "conservative" estimate, researchers think at least half of the sun-like stars could have planets with water. Another estimate, this one deemed more optimistic, said that as many as 75 percent of planets could meet the same standard. Read Full Story.
DoorDash, Roblox, Wish and Airbnb all expected to go public before year’s end
Some of the hottest private consumer tech companies are rushing to file their IPO prospectuses so they can go public before the end of the year. Airbnb, DoorDash, Roblox and Wish are all expected to make their filings public by early next week, said people familiar with the matter. It’s already been a big year for tech IPOs, most notably in September, which was the busiest year on record for the New York Stock Exchange. Read Full Story.
Thank you for reading this week’s edition of the Myth of Money.🚀
Until next week,
By Tatiana Koffman
Hi there and thanks for reading. If you stumble upon my newsletter, you will notice that I write about money, economics and technology. I hold a JD/MBA and spent my career in Capital Markets working across Mergers & Acquisitions, Derivatives, Venture Capital and Cryptocurrencies. I believe in empowerment through closing the financial education gap and creating equality of opportunity for the next generation. Check out my articles in Forbes here.
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