Satoshi Cycle

The Satoshi Cycle basically states that this rising interest or curiosity in Bitcoin leads to parties running searches for Bitcoin on Google and other search engines. The increasing search hits, in turn, increases the value of Bitcoin. The more Bitcoin rises in value, the more interest in it – the more interest, the higher the price of BTC. And so, the cycle continues. In effect, the rising interest in Bitcoin would lead to increased participation in the use of the currency. The increased participation translates into a higher demand for the coin. Like the stock market which is fueled by demand, an increase in demand for Bitcoin would lead to further increase in its value.

However, critics fear that Bitcoin is simply a bubble, given that its rising value is tied to the heightened curiosity among traders, investors, and hedge funds. Christopher Burninske, after making mention of the “the virtuous Satoshi Cycle” stated that after every bubble there’s a crash. But after eight years of its disruptive entry into the digital world, no one can really state for a fact whether Bitcoin has a limited or unlimited upside trajectory.

Insight from the @NYUStern Token Summit

Cryptocurrencies provide a mechanism to flip that around. Maybe what happens is the people who power the applications end up with all the money, and the person who created the application ends up with very little of it. Check the link for more from the @Nyustern Token Summit.

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Bitcoin, Ethereum, and Litecoin

This year may be remembered as the year of Cryptocurrencies. While Cryptocurrencies have been around for some time, I would argue it was in 2017 when they reached a ‘tipping point’, becoming something more than a niche, alternative investment.

Where’s the proof? Year to date, Bitcoin has increased 370%, Ethereum has increased 2940%, and Litecoin increased 1650%. Comparatively, the S&P 500 has increased 10%. Produce returns +30X the benchmark and Investors take notice.

So how might you invest in Cryptocurrencies? I recommend using Coinbase and its sister exchange GDAX.

On both sites, you may purchase Bitcoin, Ethereum, and Litecoin. Coinbase charges a brokers fee, though locks in the price at the moment of transaction. Using limit orders on GDAX, you can avoid the brokers fee, though you will be subject to the changing market price as the order is filled throughout the day. For individual investors, both Coinbase and GDAX limit the amount you may purchase within a given a week, which could be seen as a drawback.

Curious to learn more, check the videos below.