Bitcoin put a smile on investors' faces last week...
Our favorite decentralized cryptocurrency rose to $31,400 on Friday.
That is a 14% jump from where it was trading last Monday. And it brings the gains for bitcoin investors this year to 83%.
Bitcoin is the benchmark in the cryptocurrency market. If it is going up, the rest of the cryptocurrency market tends to do well. If it is falling, it is bad news for other cryptocurrencies.
And world-renowned crypto investment expert Teeka Tiwari believes that bitcoin's 2023 rally is just the beginning of a more sustained bull market.
That means now is a great time to put some opportunistic capital to work.
It's all due to what he calls the "institutionalization" of cryptocurrencies.
Before we dive in, a warm welcome to new readers...
the daily cut is the premium ezine we created for Legacy Research's paid subscribers.
It's a newsletter of the best money making ideas from Teeka, Nomi Prins, Colin Tedards and Phil Anderson. We also have information from traders Jeff Clark, Larry Benedict and Imre Gams.
At Legacy, we publish 22 investment and trading notices. We also publish five daily email newsletters.
Going through it all takes hours every day. Most people don't have time. So, I check it for you. And I put together a daily newsletter with your best ideas.
One of the most profitable ideas that I have shared with you has been the rise of bitcoin and other cryptocurrencies.
It has been a roller coaster. But the people who have followed our repeated recommendations... and weathered the ups and downs... have been able to move the needle on their wealth in a meaningful way.
Teeka first recommended Bitcoin in April 2016 when it was trading at just $428. Since then, it is up 8,069%. That turns $10,000 into over $800,000.
And it's not even the highest gain in your crypto approach Palm Beach Confidential advisory. Teeka's high yield recommendation on the model portfolio has increased by 20,933%.
That turns $10,000 into nearly $2.1 million.
And if Teeka is right, it's not too late to turn a profit.
It's all due to the greed of Wall Street...
Teeka first mentioned it on these pages in September 2018 when discussed your bitcoin recommendation...
When you're looking at early-stage technology, you can't let price be your only barometer. If you panic and sell every time a speculative asset like bitcoin crashes, you'll never make any real money.
A much better metric to look at is the adoption rate. Are more people using the technology? This is the important question to ask yourself, not what price it is trading at today.
And as he's been spreading the word, the main driver behind the adoption will be Wall Street greed.
Here's what Teeka told people at our 2022 Subscriber Summit in Washington DC...
Bitcoin is a $1 trillion financial asset. The people on Wall Street are not a part of that. They do not receive any of the fees associated with trading cryptocurrency. They see capital leaving the traditional financial system and going into this alternative system. So now the traditional financial system is trying to co-opt bitcoin.
And we've been watching this game for the past few weeks...
On Tuesday, Schwab and Fidelity launched a new cryptocurrency exchange...
It's called EDX Markets. And it's not just backed by these two major financial firms.
Ken Griffin's Citadel Securities is also a sponsor. It is one of the largest market makers in the US.
Unlike cryptocurrency exchanges Coinbase and Binance, which are in hot water with regulators at the moment, EDX will not hold clients' cryptocurrencies.
Instead, it will store clients' cryptocurrencies at custodian banks.
And that is a game changer.
Sam Bankman-Fried's cryptocurrency exchange, FTX, went bankrupt last November after it mixed client funds with a hedge fund it managed. And regulators say something similar happened at Binance.
With EDX, that can't happen. Therefore, investment managers can feel secure in investing clients' money.
Last week, BlackRock also filed for a "spot" bitcoin ETF...
There are already several exchange-traded funds ("ETFs") that allow you exposure to bitcoin futures. These allow you to place bets on the future price of bitcoin without owning it.
But so far, there is no ETF that has bitcoins in its name like gold ETFs do.
And that is a big problem. A spot bitcoin ETF would give regular investors easy access to the cryptocurrency, for the first time, through their brokerage account.
If anyone can get a bitcoin ETF approved, it's BlackRock. It is the world's largest money manager with $8.5 trillion in assets under management.
But BlackRock isn't the only Wall Street heavyweight applying to launch a spot bitcoin ETF. Also WisdomTree. It is the 10th largest ETF provider in the US.
As much as $1.3 trillion could find a home in cryptoโฆ
Jim Kyung-Soo Liew is an assistant professor of finance at Johns Hopkins University. He estimates that the ideal allocation to crypto for institutional investors like mutual funds, hedge funds, endowments and family offices is 1.3% of his portfolios.
This helps them diversify beyond stocks and bonds. It also gives them the opportunity to significantly increase their returns.
Right now, their allocation to crypto is practically zero. Professional money managers are wary of buying cryptocurrency on the online exchanges used by individual investors today.
But once they have the infrastructure they need, they can put a portion of their customer accounts into crypto.
According to the Boston Consulting Group, there is about $100 trillion in global assets under management.
If we see 1.3% of that flow going into cryptocurrencies, we're talking about roughly doubling the size of the cryptocurrency market.
Right now, the combined value of all cryptocurrencies traded is $1.2 trillion. If we see $1.3 trillion in global wealth enter the market (1.3% of $100 trillion), the crypto market capitalization would rise from $1.2 trillion to $2.5 trillion.
That makes now a great time to put some capital to work in cryptoโฆ
Most Wall Street players have missed out on bitcoin gains so far.
They will not make the same mistake twice. Some of the world's largest financial firms are building new platforms to allow their clients to trade cryptocurrencies.
That is why Teeka says that Bitcoin will hit $500,000 by 2025.
The new supply of Bitcoin will decrease over time until it reaches a maximum limit of 21 million bitcoins.
This constant supply restriction is built into the bitcoin code. No person, corporation, or government can change it.
And as demand for an increasingly scarce asset increases, its price has to raise. This is how markets work.
Greetings,
chris lowes
Editor, the daily cut
