India Takes Middle Road in Crypto Regulation
Inflation Crisis — 88% of Americans are Worried
How to Protect Against Inflation?
Twitter Memes of the Week
Trivia: *HODL — comes from a misspelling of the word HOLD when a drunken person wrote “I AM HODLING”; it now means to Hold On for Dear Life and is often used to refer to crypto maximalist who hold crypto for the long-term.
India Takes Middle Road on Crypto Reg.
With fear rampant in the crypto markets — as evident from the recent price volatility, HODLers finally got respite after positive news came out of India on crypto regulation. The proposed legislation, which is scheduled to be discussed early this week in parliament, will take a middle road approach on regulating cryptocurrencies, according to leaked government sources reported in the Economic Times.
The bill is called The Cryptocurrency and Regulation of Official Digital Currency Bill 2021; its main objective is threefold: to create an Official Digital Rupee, to regulate crypto in general, and to ban all “Private Cryptocurrencies” for remittences and settlements.
This bill comes on the heels of months of media FUD — Fear, Uncertainty, Doubt — circulating about the possibility of India taking a China-like ban approach on cryptocurrencies.
Ever since COVID threw a curve ball to the world, India’s goal of a $5T economy by 2025 has now seen its GDP undercut by >7%. Now, many in India are looking to the cryptocurrency economy for a new wellspring of growth.
However, the Reserve Bank of India (RBI) is staunchly opposed to all cryptocurrencies and has expressed fears that crypto poses an imminent threat to India’s control over its macroeconomic and future stability.
Still, there seems to be much confusion on what exactly constitutes a “private cryptocurrency”? One take is that it could just refer to “privacy” coins such as Monero (XMR) or Zcash (ZEC). At the moment, the government of India seems bullish on protecting its currency while still permitting the trading of crypto assets like Bitcoin and Ethereum.
Inflation Crisis — 88% of American are Worried
According to a new study, 9 in 10 Americans are now worried about runaway inflation. The survey, conducted by Country Financial, found that tens of millions of Americans are concerned about soaring food, energy, home prices, and that inflation is here to stay.
Some studies have suggested that this is the worse inflation we have seen since the 1970s, while others say it is only as bad as the 1990s. Either way, this “transitory” inflation is now worldwide with many countries witnessing double-digit inflation and affecting more than 1.1 billion people.
Here are three troubling charts suggesting hyperinflation is rampant:
How To Protect Against Inflation?
At the beginning of the Printdemic, Wall Street billionaire and investment advisor, Paul Tudor Jones, wrote a bombshell 10-page document in which he accurately prognosticated the current inflation crisis due to the Fed’s unfettered money printing.
A key point to his novel thesis — The Great Monetary Inflation — were nine strategies to safeguard wealth. Among all the TradFi advice, PTJ shocked the world when he suggested that Bitcoin was among the top 4 investment vehicles to use as a hedge against inflation.
PTJ has since doubled down on Bitcoin, saying that he now considers it to be a better store of value than Gold and also a better hedge against inflation. If you haven’t read it (see link👆), you should; in retrospect, this document sparked the fantastic bull run of 2020.
Here is an excerpt from PTJ on how to protect against inflation:
One thing that piqued my interest from this list of assets, and that one day might be brought to prominence by the GMI, is Bitcoin. Truth in advertising, I am not a hard-money nor a crypto nut. I am not a millennial investing in cryptocurrency, which is very popular in that generation, but a baby boomer who wants to capture the opportunity set while protecting my capital in ever-changing environments. One way to do that is to make sure I am invested in the instruments that respond first to the massive increases in global money. And given that Bitcoin has positive returns over the most recent time frames, a deeper dive into it was warranted. I did have some experience with it back in 2017, having a tiny amount in my personal account for fun. Amazingly, I doubled my money and got out near the top when it was apparent to any market technician we were blowing off.
Doubled his money! Not too shabby. But what if he just held it instead? I decided to crunch the numbers and see. He bought Bitcoin at ~$7,500, sold at around ~$15,000, and made a $7-$8,000 dollar profit. However, had he HODL’d, he would’ve seen a 773% increase! A $50,000 dollar profit (Bitcoin is currently at $58,000). So while the dollar is flatlining into asystole, Bitcoin is booming with an average return of 200% every year!
DISCLAIMER
THE VIEWS AND OPINIONS EXPRESSED BY THE AUTHOR ARE FOR INFORMATIONAL PURPOSES ONLY AND DO NOT CONSTITUTE FINANCIAL, INVESTMENT, OR OTHER ADVICE.