🔗 News Wrap-up
The first of many to come, check your inbox every Saturday morning. Best enjoyed with coffee and brunch ☕
If you haven’t already, please first read about the History & Purpose of this newsletter. It sets the tone for the rest of what you will read.
Market update 📉
Given this is the first newsletter, let me set the scene for you. Financial markets move in cycles, and right now stocks, crypto, and basically everything is going through a rough time. Global conflict, supply chain issues, and inflation don’t help. For experienced investors that have seen their portfolios lose value, they know it’s only “realised” if they sell, and will need to wait patiently for them to recover.
This presents a wonderful opportunity for people new to investing to start in a time when everything is on sale! Could this be you? 🤩
Crypto is currently in a “bear market” cycle meaning that the price of bitcoin, the largest and most influential crypto, is in the blue/green band on the chart below (note vertical axis is log scale!). Historically this has always been a great time to invest. We will keep referring back to this as the market move over time and it will help us decide when to take some profits.
Another useful metric is market sentiment. Humans make terrible investors because most will lose to their emotions. Greed will cause them to buy the top of a cycle, when the risk is actually the highest and they should be taking profits. Fear will make them sell at the bottom, when that's the best time to buy more.
In this space, we measure this market sentiment using the Crypto Fear & Greed Index. (follow the link to read the methodology). As you can see below we are in the fear zone, historically this has always been a great time to invest. You could be starting your investing journey at the perfect time! 🤑
Hopefully that sets the scene - you are in the right place at the right time. Let me be your guide through the world of blockchain, Web3, and the emerging metaverse. Whether your goal is investing in a new financial system, or seeking business opportunities in the next generation of the internet, I'll help you master the basics and join the ranks of early adopters in this exciting new space.
Interesting news from the week 🗞️
I have a tasty mix of 3 stories for you:
El Salvador will buy 1 BTC a day indefinitely. After making Bitcoin legal tender last year, its large initial purchases at the top of the market are now in a loss (even countries can buy the top of the greed cycle!). President Bukele has been a huge advocate of Bitcoin to help Salvadorians improve access to financial services and to escape being reliant on using USD. Coming in 2023 is a Bitcoin Volcanic bond 🌋, a project meant to raise $1 billion from investors to build a Bitcoin city.
Elon Musk expects Neuralink's brain chip to begin human trials in 6 months. 🧠Before you shudder and brush it off as tech going too far, I have a few points for you to consider:
It’s no less invasive then cochlear implants which have been safely helping people with profound hearing loss for decades.
The immediate use cases are theraputic and there will be thousands of volunteers keen to regain some sight or movement.
It’s easy to see future iterations of this become a useful tool to interface with devices and the online spaces we live, work and play in - aka the Metaverse.
Porsche is the latest mega brand to experiment with NFTs 🚘. This comes after it was recently revealed that Nike has made $185 million in NFT sales, and that NFTs can be great business when done well. The upcoming drop of 7500 Porsche 911 car NFTs will have owners play a role in selecting traits for the car as well as getting “money can’t buy” experiences as well as the opportunity to “co-create Porsche's future in the Web3 universe”. Mint is in January, price has yet to be announced. Another step to mainstream NFT adoption ✅
Learning time 💡
For the first learning time, I’m going to walk you through step by step how to set up a wallet and buy your first crypto (whoop whoop!). Reading about it is fun but getting hands-on experience its what solidifies learning.
In the tutorial below you will swap $50 of NZD to BNB, a popular crypto coin with a huge ecosystem of dapps (decentralised apps) for us to play around in over the coming weeks. It also has very low transaction fees, perfect for this “play” wallet.
Make yourself a hot drink, set aside 45mins and jump in: Beginners guide to buying your first crypto in New Zealand
DCA with me 💰
In this section I share what I am investing in this week. DCA refers to Dollar Cost Averaging, the practice of systematically investing equal amounts of money at regular intervals, regardless of the price of the stock/crypto. It takes the pressure out of trying to time the market (almost impossible to do well), and builds good investing habits.
As an aside you can do this easily with the stockmarket too by setting up a regular auto-invest through a platform like Sharesies.nz, I’m be talking more about this in future posts. If you want to get a head start, follow this referral link you will get $5 to start with (and I’ll get $5 too).
Back to crypto - with everything on sale and market sentiment in the toilet 🚽, history tells us that now is actually the best time to begin a DCA strategy with a 2-3 year horizon. Have a think about an amount you could comfortably dedicate each paycheck, $50 is common.
Let’s dive in, we can do it together! 💪
Given we are looking for long-term value growth, we want to invest in projects with utility and momentum, but we want to get in at a good entry price. Then we can check back in in the next bull market (bull = historically up) and take some profits.
We are going to start our DCA journey with the OG, the granddaddy, Bitcoin. I’ll explain what makes Bitcoin special in future newsletters, but if there’s only one to buy and hold long-term, it’s Bitcoin.
Apply the same steps in this guide to buy the Bitcoin if you are confident and ready. Otherwise use your 1:1 session with me to help you, or just wait for now. No rush!
Like all investment decisions, you should DYOR (do your own research) and read the disclaimer.