Cryptocurrency, Cannabis & Silver

Cryptocurrency - HIVE, I don't own any of their stock, I do however have a small share of hash power from their 30% holder Genesis Mining www.genesismining.com, there are other blockchain investments that I believe have more potential, like Ripple and Ethereum for example. Although my strong bullish bias nature believes Bitcoin can go to 100,000$ or even more in extreme circumstances, the truth is that I also believe it can go back to 1000$ per Bitcoin. Why? Because Bitcoin is not what it was when I started researching it and believing in it. When I started pitching Bitcoin, my greatest points were that you can make a transaction within seconds and the fees were as low as a few pennies, even for million dollar transactions. That was a great achievement if you wanted to send money to your family across the world that couldn't wait days for a transfer, or didn't have a bank account, or simply didn't want to pay high western union fees. What happened soon after was that the developers of Bitcoin 'artificially' capped the transaction block-size in order to activate a fee based mining incentive (mining is the term for developers creating bitcoin), what this did was raise fees for miners as time passed in order to keep the incentive for developers to keep mining since Bitcoin was getting harder and harder to reward. Stay with me. Now with the sudden influx of people getting into Bitcoin, today's transaction times take just as long as mainstream companies such as Western Union (sometimes taking days), and the fees are even higher! Leaves me wonder, what is Bitcoin's benefit now? In reality it's actually a risk, as Western Union at least insures your transfer if for whatever reason it gets lost along the way. With that said, I believe the current price of Bitcoin and it's historic rise (even surpassing tulip mania) can be the byproduct of false speculation. Although the 'technology' behind bitcoin, which is the blockchain, is a beautiful thing and will surely change the way the world does business and transfers information, it is internet 2.0, however people are buying bitcoin with the expectation that if they buy today, they can sell it tomorrow and be overnight millionaires. In this sense, they are creating a bubble that may correct at any time. Will it correct at 25k, 50k, 100k..? That's the million dollar question. People that were getting involved with Bitcoin early, won't feel the pain of any kind of correction, in fact, even a 90% correction, which seems to be common in Bitcoin still leaves early adopters in the green. However the people that get in at the wrong time will get hurt. Some people are re-mortgaging their houses to get into bitcoin, I don't know if that's smart, who knows, maybe it will surpass 100k and they will get rewarded for their risk, I hope it does. One thing that is certain is that people buying solely on speculation (without understanding the blockchain) to sell higher to exchange bitcoin back to fiat currency for a profit will get burned at some point. Buying bitcoin to exchange it back for more fiat currency is actually a contradiction to why bitcoin was created in the first place, read the white paper written from Bitcoin's creator (Satoshi Nakamoto) here: https://bitcoin.org/bitcoin.pdf

Ripple and Ethereum are actually better than Bitcoin at this point in my opinion, for usability and adoption by establishments at least. In the sense that they still have the fast transaction time and low fees and can process more transactions, the way Bitcoin used to be. 90% of the current ICOs projects today are Ethereum based, that says a lot about where the price of Ethereum will go in the very near future. In the end, there is a possibility that most, if not all cryptocurrencies could crash, the way internet stocks crashed a little over 15 years ago, the internet continued to grow however, in fact the internet is bigger today than ever. The blockchain will also continue to grow and evolve the same way, as well as flushing out the less useful technologies and giving way to the best ones in the process. Banks have realized this and they are starting to accept and show interest in blockchain technology (hence American Express' partnership with Ripple, as well as Moneygram now talking about blockchain integration). Bitcoin has first mover advantage and is the mother of everything that came after it. Investors barely fully understand Bitcoin (yet), let alone other, more complex technologies like Ripple or Ethereum. I have a hard time explaining to newbies how to create wallets sometimes. I start explaining 2-factor authentication and their eyes start rolling behind their heads. It is still early in the alt coin sector and mainstream is slow to catch on, heck, I still know people that barely use 'email'. Bitcoin is 10 years old, yet some people believe it was created last year. I guess mainstream media plays a significant role in that aspect.

Silver - the worlds most undervalued commodity. There are so many reasons why one should own silver that I don't know where to start. Besides the fact that it can be used as a store of value, it is one of the most used industrial metals in the world, the ratio between gold and silver is over extended currently at an average of 75-1 when it should be 15-1. That could only mean one thing, either gold will go down or silver will rise, or a little of both. I believe that they will both rise to historic highs in the near future. Gold has been a steady buy in India and China for over a decade (see chart below). India and China has gone on a buying binge and been hoarding, with an increase of 500%+ in buying average since 2012, depleting supplies at an exponential rate. The population of Asia is 4.4 billion people. Are we really going to ignore a buying frenzy from those kind of population numbers?

At the same time the supply of silver is rapidly decreasing and mining companies are mining less and less everyday. Economics 101 taught us the rules of supply/demand/price.

Buying physical silver is preferable to buying stocks, as paper promises such as stocks could easily be manipulated or simply not paid to the owner, the same way they just stopped paying people in what dollars were suppose to be backed by in the first place, gold! Physical coins and/or bars are better to protect your hard earned money from being devalued by senseless government spending. Besides a store of value silver will continue to be in demand as it is needed for things such as batteries, it's solar use, electronics, among many other industrial uses.

If you are less paranoid you can invest in SPROTT FUND, it is one of the better silver funds out there as Mr.Eric Sprott (google him) is very knowledgeable in the silver mining companies he adds to his fund. You can even add this fund to a tax free trading account where you don't have to pay taxes on capital gains (how sweet is that?).

pic credit: www.goldsilver.com

Cannabis - Another newly emerging industry in legal waters is on it's way as state by state is starting to legalize cannabis for recreational and medicinal purposes, including Canada implementing nationwide legalization in July 2018. One of the stocks I mentioned in 2015 was Aurora Cannabis, worth less than 2$ at the time, now worth over 14$. Another mention, MYM Neutraceuticals, trading at 50 cents at the time, now trading over 4$, without even completing the application process for their ACMPR permit yet. Same with CHOOM holdings. I believe when these companies get their permits inevitably approved, naturally the price should continue to rise. Furthermore, upon legalization in 2018, they will start to get recreational sales revenue on top of the medicinal sales revenue in their books, that should be a good indicator as to where share price for these companies is going. A strong buy in the cannabis sector is very HIGH (no pun intended).

pic credit: www.auroramj.com

*This is not intended to be construed as investment advice, as i'm not a financial adviser. Please always do your own research when investing.

George G.

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