When we spoke on Dec. 19, I warned you to be careful about getting into Bitcoin as we head into 2018.
No, I'm not pessimistic about cryptocurrencies in general or Bitcoin in particular. In fact, just the opposite is true - I firmly believe these e-currencies are the wave of the future and still face huge upside.
My concern is for individual investors like you. At the time, Bitcoin had literally just hit the futures markets for the first time ever. And Wall Street traders, hedge funds, and other high rollers were sharpening their knives - setting Bitcoin up for massive volatility.
My call couldn't have been timelier.
Practically as I hit "send" on that report, Bitcoin fell $1,070 in a day. Not only that, but it weakened over the next few days, falling from a high of roughly $20,000 to $12,500. That's a 37.5% peak-to-trough loss.
Today, Bitcoin has swung back up to around $15,300.
For you Bitcoin veterans out there, that kind of swing is pretty normal. You folks can handle it. But for new investors, that type of volatility is hard to swallow.
So what I want to tell you today may sound a bit counterintuitive, but here we go...
Please don't cash out of Bitcoin completely.
If you do that, you'll miss out on the hard forks.
If you set yourself up correctly, these Bitcoin spin-offs could mean gains of several hundred percent.
Here's how to do that...
Why Bitcoin Was the Investment of 2017
In the past year, the price of Bitcoin has hit peak gains of some 1,900%.
Some of that can be chalked up to the crypto craze we've been seeing, no doubt. I don't know about you, but nearly every conversation I had at Christmas parties this year revolved around Bitcoin.
But what all those folks are buying - what they're hanging their hopes on - is good, old high technology. As we all know, the road to wealth is paved by tech.
See, the technology underlying Bitcoin and other cryptocurrencies - known as blockchain - adds new dimensions to data that layers in both time logging and other ledger characteristics that create layers of security by design.
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That's what has Silicon Valley, Wall Street, and just about everyone else so excited about getting into a field that almost no one had heard of when I first started telling folks about it way back in early 2013.
Blockchain is a highly secure, cryptographic system that functions as a global distributed ledger. This system not only undergirds Bitcoin and other currencies, it also bypasses banks and governments, operates transparently, and is virtually hack-proof.
That means, almost immediately, many of us will be settling contracts with blockchain. By doing so, we'll avoid bank fees, possible litigation, and all lot of other issues that economists like to refer as "friction." Plus, you can go online and watch these transactions occurring in near real time.
Plus - and here's where it gets good - blockchain technology is the source of those hard forks... if you own some Bitcoin.
Here's what I mean...
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These Hard Forks Could Be Your Biggest Source of Profits in 2018
Hard forks happen when developers feel the Bitcoin blockchain needs new features. You see, Bitcoin is kind of like gold - it's good to buy and store in a vault. It's not very useful. But many of these "fork coins" have special utilities that many people would find very useful.
These developers can also set up a Bitcoin fork when they feel the cost of mining has gotten so expensive that only a few elite code warriors can participate.
With each fork, Bitcoin is subdivided into two currencies - the original and the new coin. To facilitate these forks, the Bitcoin community then spins off the fork coin to current Bitcoin owners... for free. If you own one Bitcoin, you get one fork coin - if you own 0.33 Bitcoin, you get 0.33 of the fork coin, etc.
There were two major hard forks in 2017. The first occurred back on Aug. 1, when Bitcoin Cash emerged. That event marked the new currency at roughly $291; Cash quickly jumped to more than $400 before selling off again.
But as the price of Bitcoin has risen recently, so has the price of Bitcoin Cash. When Coinbase added the currency to its lineup earlier this month, the price leaped as high as $3,575.
Another hard fork came on Oct. 24 with the spin-off of Bitcoin Gold.
At the time, the financial media was rife with stories about how this hard fork would damage the value of Bitcoin itself.
Yes, Bitcoin hit a short-term decline, falling to $5,374. But as you've seen, the price since then has more than tripled. To me, that means these forks have been good for both Bitcoin and the fork coins.
As for Bitcoin Gold, it promptly lost more than 50% of its value. Then it traded sideways for several days before ramping back up again. Recently trading in the $270 range, Bitcoin Gold is still off its entry price of roughly $485.
But remember, Bitcoin has gone through similar periods of declines - only to ramp up and hand investors massive gains.
And that's why you shouldn't be selling all your Bitcoin holdings. You want these hard forks and the profits they'll bring you in 2018 - and beyond.
Take Some Gains - but Not All of Them
That said, I still believe in treating your Bitcoin and other cryptocurrencies the same way you would stocks or other investments.
Take some profits along the way, ideally winning all your original capital back. Then you pocket those big gains and keep playing the field using the "house's" money.
If you stay in Bitcoin now, you're setting yourself up for what currently looks like eight more hard forks in the near future...
- Super Bitcoin
- Bitcoin Platinum
- Bitcoin Uranium
- Bitcoin Cash Plus
- Bitcoin Silver
- Lightning Bitcoin
- Bitcoin God
- United Bitcoin
It's impossible to predict the price or performance of any of these upcoming spin-offs, but that's beside the point.
As a Bitcoin owner, you'll keep getting these new coins for free.
If in 2018 these spin-offs climb just 10% of Bitcoin's stratospheric rise this year, you'll see returns of 190% - multiple times over.
Even if selling all your Bitcoin right now seems very tempting, with so much money on the table, these spin-off coins are a deal that's just too good to pass up.
Now, as far as when to buy and sell Bitcoin - or any of these fork coins or other cryptocurrencies - I plan to help you out there.
This is far too volatile a market for you to strike out on your own. Just look at what's happened over the past week or two.
I want to make you a lot of money - with cryptos, with Silicon Valley venture investments, and with legal marijuana stocks. The kind of money you can use to fund a retirement, pay off a college education... or buy a boat.
So stick around.
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The post How to Play Bitcoin Forks for Big Profits in 2018 appeared first on Strategic Tech Investor.
About the Author
Michael A. Robinson is a 36-year Silicon Valley veteran and one of the top tech and biotech financial analysts working today. That's because, as a consultant, senior adviser, and board member for Silicon Valley venture capital firms, Michael enjoys privileged access to pioneering CEOs, scientists, and high-profile players. And he brings this entire world of Silicon Valley "insiders" right to you...
- He was one of five people involved in early meetings for the $160 billion "cloud" computing phenomenon.
- He was there as Lee Iacocca and Roger Smith, the CEOs of Chrysler and GM, led the robotics revolution that saved the U.S. automotive industry.
- As cyber-security was becoming a focus of national security, Michael was with Dave DeWalt, the CEO of McAfee, right before Intel acquired his company for $7.8 billion.
This all means the entire world is constantly seeking Michael's insight.
In addition to being a regular guest and panelist on CNBC and Fox Business, he is also a Pulitzer Prize-nominated writer and reporter. His first book Overdrawn: The Bailout of American Savings warned people about the coming financial collapse - years before the word "bailout" became a household word.
Silicon Valley defense publications vie for his analysis. He's worked for Defense Media Network and Signal Magazine, as well as The New York Times, American Enterprise, and The Wall Street Journal.
And even with decades of experience, Michael believes there has never been a moment in time quite like this.
Right now, medical breakthroughs that once took years to develop are moving at a record speed. And that means we are going to see highly lucrative biotech investment opportunities come in fast and furious.
To help you navigate the historic opportunity in biotech, Michael launched the Bio-Tech Profit Alliance.
His other publications include: Strategic Tech Investor, The Nova-X Report, Bio-Technology Profit Alliance and Nexus-9 Network.