Bitcoin After Venezuela
A few years ago, I recommended selling Bitcoin (BTC).
The decision felt obvious.
Ethereum (ETH) processed four times as many transactions.
Bitcoin’s utility was unclear. Regulation was a constant headache.
While Bitcoin was the original cryptocurrency, better opportunities existed elsewhere.
But the world has changed.
As I explained in our Altucher’s Investment Network strategy session last week, a military operation in Venezuela just made that crystal clear.
And now new catalysts for a Bitcoin takeoff are lining up…
A New Financial System Emerges
As Venezuela transitions, cryptocurrency could play a significant role.
María Corina Machado, Venezuela's opposition leader, is a Bitcoin advocate.
She said Bitcoin should be part of Venezuela's national reserves. She called it a "lifeline" that some Venezuelans used to protect their wealth and to finance their escape.
Under Chavez and Maduro, a year's salary in bolivars in 2014 became worth significantly less than a single U.S. penny today.
Bitcoin could become the new standard.
Unlike traditional currency, it works without banks, can't be devalued overnight by printing more, and moves across borders in seconds.
These features matter for Venezuelans who’ve seen their savings evaporate under decades of dictatorship.
Venezuela's new government may encourage cryptocurrency usage to jumpstart the economy without relying too much on the dollar.
But there’s another layer to the crypto situation in Venezuela that’s causing me to change my view on Bitcoin…
The Hidden Bitcoin Connection
Donald Trump took office on a very pro-cryptocurrency platform.
He signed an executive order to create a strategic Bitcoin reserve and vowed to never sell the government's holdings.
Venezuela is an opportunity for him to fill that reserve without spending taxpayer dollars.
For years, Venezuela used Bitcoin to evade sanctions. When you're cut off from the global financial system, you find alternatives.
Experts believe Venezuela accumulated a massive Bitcoin stash. Some estimates put it at $60 billion.
With Venezuela under U.S. control, Bitcoin could soon belong to the US government.
Why I'm Backing Bitcoin Again
While Bitcoin doesn't have as many daily users as Ethereum, that could soon change.
In countries with broken banking systems, crypto provides an alternative. Because this is bigger than just Venezuela.
Iran and Cuba could also undergo political change soon, and citizens in both countries are turning to Bitcoin as their local currencies collapse.
Bitcoin, as the original cryptocurrency, carries a legitimacy that newer coins can't yet match.
The anticipation of mass adoption will drive up the price enormously in the coming months.
Investors who position themselves with the right investments, like Bitcoin, can create massive wealth from this transformation.
