Bitcoin Adoption: Gradually, then suddenly
Global Wealth is a $900 Trillion pie. Bitcoin currently ONLY represents 0.14% at $1.3T
Today I had lunch with a few business owners today that picked my brain on my thoughts about the market, but were more curious about which bank was the best place to “invest” cash. LOL
These are smart business men who have a lot of cash. About 10 minutes in, I transitioned into Bitcoin which left them pensive/ curious to know more. They all appeared to know something about it, but not enough to be convincing.
What really struck a cord with them:
I asked them what they thought about the fact that Bitcoin was already a $1T+ asset and that it only represented 0.1% of all global wealth. They were shocked and unaware it was valued at $1T+ To put it in perspective, I showed them this matrix which illustrated the distribution of global wealth across various asset classes. One of the guys said, "my son told me to buy when it was at $30k, is it too late now?"
I proceeded to demonstrate, on a napkin, how much their cash savings has been debased just in the last 5-10 yrs and showed them an image of how the purchasing power of the US dollar declined by -99% in the last 100 years and how it'll only accelerate at the rate the supply of money (USD) was growing at.
The below visuals should shake you.
They also weren't aware of how much debt the US government had and among themselves said "this is unsustainable" which is true.
If you didn’t know, the US debt now stands at $35.6 Trillion and only going up. Look at the image below to see how fast and up to the right debt has gone in the last 4 and 10+ years
Regardless of the administration, both parties will run up the deficits as much as they can - this is why the debt ceiling limit is BS and always gets increased -- the debt is never going to get paid off.
As governments continue to increase their debts and central banks continue to increase the currency in circulation, prices inevitably rise. This increase in the money supply is the fundamental cause of the escalating cost of living and represents the mathematical inevitability of a debt-based monetary system. We (the US) via the federal reserve print more money in order to be able to finance our growing debt.
This results in fiat debasement, aka dollar losing its value. And since debt + money supply are growing EVERY year, in other words, ALL people, including YOU, saving in dollars, euros, yen, yuan, etc., are ALL getting poorer every year.
For your friends and family still struggling to understand the root cause of inflation, it’s a result of uncontrolled government spending as a ballooning levels of US public debt which is created by issuing more dollars.
NOTHING stops this train of kicking the can down the road through more and more debt and money creation at a faster and faster rate.
After getting their attention, their next concern was that Bitcoin wasn't safe to buy, so I distinguished the difference between Bitcoin and what I imagined they were referring to, broader crypto.
Then I told them about the Bitcoin ETFs and pulled up a chart from today that showed that the Bitcoin ETFs surpassed $20B+ in total YTD net flows for the year (it took Gold 5 years to achieve the same result). ETFs are a familiar and traditional security invested by many. Vanguard ETFs, Fidelity ETFs, ishares Blackrock ETF are some that come to mind.
Here’s a link of all the publicly listed Bitcoin ETFs to choose from - Bitcoin ETFs
After hearing this, one of the men called his broker to see if he could purchase 50k shares of IBIT 0.00%↑ (Blackrocks Bitcoin ETF) today. That’s a $1.9M+ order!
Lastly, I showed them Bitcoin's compounded annual growth rate (CAGR) of +80% over the last 8 years.
I asked them bluntly what other asset can they name or do they own that's achieved 1/2 of that % in the same timeframe. Obviously there isn't one. So I said if you could invest in an asset with a +40% CAGR over the next 10-20 years, wouldn't you be open to it.
They nodded, but you could tell there was alot they were processing.
For context, the type of people at the table were, a doctor, owner of a yard in one of the largest ports in the East coast, a councilman, police captain, RE developer, CEO of a concrete company, CEO of a seafood distributor, and an investor.
Many normal folks like them will have an "Aha" moment in the years to come and will want to have exposure to bitcoin in the future, which is exactly the type of adoption you want.