Four Reasons Why Upcoming Bakkt Launch May Take Bitcoin Past $10,000

Bakkt, the cryptocurrency startup launched by the Intercontinental Exchange (ICE), is scheduled to launch in November, and with the objective to “transform Bitcoin into a trusted global currency with broad usage,” there is speculation that this is precisely the type of groundbreaking event that the Bitcoin market needs to gain momentum after a sluggish year. I personally believe that the launch may take Bitcoin past $10,000 before the end of 2018— here are four reasons why.

Tidal Wave of Institutional Investors Could Flood the Space

Described as a “scalable on-ramp for institutional, merchant, and consumer participation in digital assets by promoting greater efficiency, security, and utility,” I believe that Bakkt, which is aptly named as a play-on “asset-backed securities,” is precisely the type of offering that will drive a massive influx of institutional interest to the crypto space, even more so than a Bitcoin ETF.

While it’s true that people frequently claim that certain events and announcements in the crypto space are indicative of mainstream adoption, I believe these claims, in connection to the launch of Bakkt, are particularly substantive. “Traditionally volatility scares most investors no matter the asset class,” says Christopher Bates, a former member of the NYSE. “Bakkt will draw resources from reputable companies with knowledge in fields of risk management and technology to create a federally regulated platform. Once investors feel at ease trading in a regulated environment volatility should ease.”

Indeed, I believe Bakkt’s first product launched on September 25, physical Bitcoin Futures contracts, which cannot be traded on the market without physically taking ownership of the underlying cryptocurrency, is Bakkt’s first concerted effort to ease fears of institutional investors who have previously stayed away.

Addresses the Shortcomings of Failed Bitcoin ETF Applications

Bakkt is focused on resolving two of the issues that contributed to the rejection of Bitcoin ETF applications earlier this year — specifically, the lack of trusted price formation and reliance on futures markets and derivatives.

As Bakkt CEO Kelly Loefffler states: “A critical element to price discovery is physical delivery. Specifically, with our solution, the buying and selling of Bitcoin are fully collateralized and pre-funded. As such, our new daily Bitcoin contract will not be traded on margin, use leverage, or serve to create a paper claim on a real asset. This supports market integrity and differentiates our effort from existing futures and crypto exchanges which allow for margin, leverage, and cash settlement.”

Ultimately, I believe these key distinctions will help distinguish Bakkt and make the company’s launch the biggest event in the crypto market this year.

Hands-Free Custodianship

One of the major roadblocks to achieving widespread institutional adoption of cryptocurrency has, not surprisingly, been concerns about security. Indeed, vulnerabilities in the crypto market were particularly highlighted in the wake of rampant ICO scams and crypto scams last year.

Thankfully, 2018 has brought an increased focus on regulatory alignment, with companies such as blockchain startup Chainalysis raising a sizable amount of money in order to provide cryptocurrency organizations with reliable Bitcoin transaction analysis data so as to be better equipped at identifying fraudulent transactions.

Bakkt, too, will provide a range of security solutions within its platform, including the monitoring of fraudulent transactions and market manipulation, as well as partnering with regulated exchanges and custodians to create an “open and regulated, global ecosystem for digital assets.” Also, Coinbase announced its launch of Coinbase Custody that could, according to CEO of Coinbase Brian Armstrong, potentially permit an additional $10 billion of institutional money to enter the space.

Operates at Warp Speed

Much like concerns about security, concerns surrounding Bitcoin’s scalability have also prevented mainstream institutional adoption. Bitcoin’s current capacity is about seven transactions a second, which is far too slow for a market to operate at an institutional level. However, developers are implementing innovative solutions like the Lightning Network in order to expedite cryptocurrency payments off the blockchain.

Bakkt will also be offering a high-speed solution. Bakkt plans to hold all Bitcoin in its warehouse, which would enable Asset Manager A to buy millions in Bitcoin from Asset Manager B, and then simply move the tokens from B’s account to A’s account via a trade on the ICE exchange. As long as exchanges are within the Bakkt ecosystem and kept within the Bakkt ledger, the exchange will not need to be reported to the greater blockchain. Transactions would only need to be reported if there were payments coming into or exiting Bakkt’s warehouse. With only a tiny portion of transactions being reported to the blockchain, Bakkt is “enabling its system to operate at warp speed,” and therefore able to keep up with institutional demands.

For all of these reasons, I, along with many other industry experts, am optimistic about Bakkt’s significance in the crypto sector and believe that it will contribute to a significant Bitcoin value increase by early November.

This article was written By Chris Kline, Co-founder, and COO at Bitcoin IRA

Bitcoin ETFs: Three Reasons Why a Positive SEC Decision Would be a Game Changer for the Crypto Space

In late June, a major news item buzzed throughout the crypto world: the CBOE had filed an application with the SEC to open the world’s first Bitcoin Exchange Traded Fund (ETF). Largely enthusiastic comments began pouring into the SEC website, with many focusing both on the potential benefits of a Bitcoin ETF as well as the importance of adapting to a constantly evolving marketplace.

While the SEC announced they will be postponing their decision until the end of September, I am very optimistic that the application will be accepted, especially given the agency’s earlier announcement that Bitcoin and ETFs are not securities, as well as its decision to ease rules surrounding low-risk ETFs. Like many in the cryptocurrency sector, I am very excited by the potential of Bitcoin ETFs on the horizon, as I truly believe it will be a game changer for the cryptocurrency space. Here are three reasons why.

Bitcoin Price Could Dramatically Increase

To understand how Bitcoin’s price could rise following the launch of a Bitcoin ETF, it’s helpful to look at the launch of a gold ETF as an example. In 2003, the price of gold dramatically increased following the launch of an ETF. “Since its launch, retail access to gold has skyrocketed as new investors more easily turn to the gold market as a portfolio diversifier and as a foundational asset…Today, the SDPR GoldShares ETF is one of the biggest ETFs in the market with over $35 billion under management,” JPMorgan said.

Given the massive growth trajectory following the launch gold ETFs, many crypto enthusiasts, including myself, believe that the same positive correlation could exist between Bitcoin prices and the launch of Bitcoin ETFs. In fact, JPMorgan has referred to a Bitcoin-based ETF as the “holy grail” for investors.

Furthermore, I believe that a Bitcoin ETF launch could drive a massive increase of institutional money to the crypto market. Between Goldman Sachs announcing the launch of its bitcoin trading platform, to JPMorgan launching a patent for blockchain-powered payments, we have already seen increased institutional adoption in the crypto space this year. However, I believe that a launch of a Bitcoin ETF would be precisely the initiative to catapult Bitcoin’s price — and the cryptocurrency space as a whole — to the next level.

Bitcoin and Other Cryptocurrencies Could Become Much More Accessible

Let’s face it: the ever-changing world of cryptocurrency is complicated even for those of us who work in the crypto space. For newcomers to the sector, it can be downright daunting. To buy and sell cryptocurrency now, investors need to deal with cryptocurrency exchanges, as well crypto wallets, both of which can be complex and confusing, and if chosen unwisely, can lead to security risks. In addition to all of this, investors face concerns regarding lack of insurance protection and crypto custodianship in the space.

“By some estimates, there is $10 billion of institutional money waiting on the sidelines to invest in digital currency today,” Co-Founder and CEO at Coinbase Brian Armstrong said in a blog post last year. The primary item that he claimed was preventing institutional investors from getting involved was “the existence of a digital asset custodian that they can trust to store client funds securely,” before introducing the launch of Coinbase Custody.

Indeed, I believe that all of these issues are currently serving as limitations that are preventing Bitcoin from reaching its fullest potential. The CBOE’s VanEck SolidX Bitcoin ETF application, however, addresses all of these pain points. SolidX would handle custody by using a cold-storage solution, meaning that all funds would be kept securely offline. Furthermore, the Bitcoin ETF would provide a robust insurance policy that would “carry initial limits of $25 million in primary coverage and $100 million in excess coverage, with the ability to increase coverage depending on the value of the bitcoins held by the Trust.”

For all of these reasons, I believe CBOE’S Bitcoin ETF application is strong and, if accepted, would bring peace of mind to a wide variety of institutional investors who have been interested in —but until now stayed away from — the crypto space.


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BItcoin ETFs Could Create a New Asset Class

In today’s financial landscape, a diversified portfolio is more desirable than ever, as it provides a hedge against risk and boosts the potential for a larger ROI. One crucial component of portfolio diversification includes investing in a variety of assets that are not correlated with one another. Bitcoin has already demonstrated that maintains low correlation with every other asset, making it a strong candidate for a diversified portfolio. And, a Bitcoin ETF could create a new investable asset class that could drive a wide range of institutional participants.

For now, all we can do is wait until the SEC makes their decision in late September.

If you’re interested in learning more about why cryptocurrency is the peoples’ currency, please upvote my panel in the SXSW PanelPicker and leave a comment about why this topic interests you. Check out Bitcoin IRA’s other SXSW panel about building the right compliance department here. Voting ends on Thursday, August 30 (9:59 PM PT) so make sure to get your votes in before then.

Three Ways to Build a Winning Portfolio with Alternative Assets

Consider Gold/Digital Gold

Gold, which has been around for hundreds of years, has cultivated a reputation as a reliable alternative asset. A physical commodity in limited supply, gold cannot be printed endlessly like paper, making it a valuable hedge against inflation.

In addition, gold is a decentralized asset that is not tied to any governmental entity, making it a hedge against stock market fluctuations and global turmoil. If you look at the data, you will see that the price of gold has increased in the following many turbulent historical events, including the Brexit vote in 2016 and in the midst of tensions United States and North Korea in 2017.

It perhaps goes without saying that there is a lot of global turmoil happening now in 2018 as well, especially in light of the United States’ active trade war with China. Given all of the volatility in today’s economic and global landscape, adding reliable alternative assets such as gold to your portfolio, in my opinion, is a proactive move.

Furthermore, since gold in its traditional form can be difficult to hold, and the purchasing fees for a retirement account can be very high, Bitcoin IRA has created a solution called Digital Gold, which combines the stability of traditional gold with the speed and security of blockchain technology.

Diversify your portfolio

Everyone has heard the saying “don’t put all your eggs in one basket,” I believe this adage definitely applies to build a winning portfolio as well. Building a diversified portfolio is a noted hedge against risk and boosts the potential for a higher return on investment.

Two crucial components for portfolio diversification include investing in different securities within the same asset type and investing in assets that are not significantly correlated with one another. According to research compiled by ArkInvest and Coinbase, Bitcoin is the only asset class that maintains consistently low correlations with every other asset, which I think makes it a strong candidate for a diversified portfolio.

In his article “How to Avoid a Retirement Disaster,” author Barry Ritholtz suggests many people do not understand the value of having a broadly diversified portfolio because they are concerned it will show a lack of corporate loyalty to their employer. “But every worker who gets company stock also gets a salary from that same employer. That is a very intense concentration of financial risk. For these workers, diversifying their company stock into broad indexes is the prudent approach,” Ritholtz adds, and I am inclined to agree. In my opinion, a balanced, diversified portfolio with a variety of asset types that are not correlated to one another is the smartest long-term strategy for boosting returns and managing risk.


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Don’t put all your savings in crypto 

This may seem intuitive, but it’s worth repeating. I believe Bitcoin and the blockchain technology powering it will continue to revolutionize retirement and the way businesses run today. That said, crypto is still very volatile, and I believe it is prudent to do extensive research beforehand and to never invest more than you could comfortably afford to lose.

2018 has marked a year of amazing regulatory progress and widespread mainstream acceptance of cryptocurrency. For those interested in building a portfolio with digital currencies as well as other alternative assets, I hope that my opinions provide additional clarity as to how to build a successful portfolio that mitigates risk and maximizes the potential for a strong ROI.

This article was written By Chris Kline, Co-founder, and COO at Bitcoin IRA

Bitcoin for Beginners: Three Things to Know Before You Buy

Bitcoin, blockchain technology, and digital currencies as a whole have made such a big splash in the news cycles over the past couple of years, and for newcomers in the space, it can be overwhelming to gain a proper sense of footing. That’s why I wanted to provide three important takeaways for prospective consumers to know before deciding to invest in this rapidly evolving space.

Digital Currencies are Built on Decentralized Technology

Following the financial crisis of 2008, people lost trust in the centralized banking system and began to demand a new currency that was not controlled by a central authority. Shortly thereafter, Bitcoin was born. Capped at a maximum of 21 million coins, Bitcoin’s limited supply means that it is not subject to the same inflation or manipulation that face government-issued currencies.

Furthermore, unlike traditional financial transactions which are verified by a third party, such as a bank, bitcoin transactions are built on blockchain technology, a decentralized database run by a global network of computers that contains a public ledger of all cryptocurrency transactions. Each connected network receives a copy of the blockchain, and transactions are verified by the community as a whole and not a centralized authority.

In an age where data security and privacy is more important than ever, many businesses and tech companies have developed an interest in implementing decentralized technology, including Facebook. “Many people now believe technology only centralizes power rather than decentralizes it. There are important counter-trends to this — like encryption and cryptocurrency — that take power from centralized systems and put it back into people’s hands. But they come with the risk of being harder to control. I’m interested to go deeper and study the positive and negative aspects of these technologies, and how best to use them in our services,” CEO Mark Zuckerberg said earlier this year.

Not all crypto investments are stored the same way

If you decide to buy bitcoin or other digital currencies, there are several different ways in which your investment can be stored.

  1. Online. Often referred to as a “hot wallet”, bitcoin wallets that are kept online and connected to the internet. If you store money with Coinbase, that is an example of a hot wallet. Since they are connected to the internet, hot wallets are more vulnerable to hackings, but on the upside, they are very accessible if you want to buy or sell a small amount of a particular digital currency.
  2. Hardware wallets. Often referred to as offline cold-storage wallets, many cryptocurrency companies store investments in hardware wallets, which can include physical thumb drives such as Trezor and Ledger. While these are less vulnerable to hackings than hot wallets, physical crypto wallets are fragile and at risk of being damaged, lost, or stolen.
  3. BitGo Offline, Digital Cold-Storage Wallets. BitcoinIRA.com has an exclusive relationship with BitGo, the leader in multi-signature encryption and digital security for offline, digital, cold-storage wallets. Security keys are kept with BitGo, BitcoinIRA.com’s custodian Kingdom Trust, as well as with a backup key provider for premium security.

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It can be volatile

Bitcoin is frequently compared with gold: both are decentralized, alternative assets that are removed from government and stock market fluctuations. But unlike gold, which has maintained a relatively consistent price trajectory in recent years, Bitcoin has been rather volatile. However, in my opinion, this is normal for an emerging technology: gold has been around for thousands of years, while Bitcoin and cryptocurrencies as a whole have only been around since 2009.

Furthermore, 2018 has been a year of major regulation for space, which has also been a strong factor in current volatility. “I think institutional investors have gained a lot of interest, and they haven’t really come into crypto yet because there is still some regulatory uncertainty,” said Fundstrat Global Advisors co-founder and bitcoin bull Tom Lee.

However, with much more acceptance from mainstream financial institutions in recent months, as well as increasing clarity from regulators, Lee still believes it is “completely reasonable” that Bitcoin will climb up to  $25,000 by the end of 2018.

Cryptocurrency may be a complex space, but it doesn’t have to be daunting. I hope that these three main points help clarify questions that crypto beginners may have as well as affirm all of the exciting developments and advancements that are happening in the field.

This article was written By Chris Kline, Co-founder, and COO at Bitcoin IRA

Top Three Trends in Crypto to Watch Right Now

By now, just about everyone has heard of cryptocurrency. The global crypto industry is evolving at a rapid pace and trends are changing constantly. As the co-founder and COO of BitcoinIRA.com, the world’s largest and most secure cryptocurrency IRA platform, I am acutely aware of how quickly space is changing. From changes in regulation to widespread adoption of blockchain technology, here we will explore the top three crypto trends to watch right now.

  1. The regulatory and decentralized technology sectors are working together

2018 has been a year of regulatory measures for the cryptocurrency space. In March, the SEC released a statement requiring all crypto trading platforms to register with the SEC as securities in order to continue operating. Also this year, Facebook, Twitter, and Google all placed bans crypto advertising.

Many crypto enthusiasts, who flocked to this formerly unregulated sector because of its decentralization and anonymity, initially feared that the increase in regulatory measures would infringe upon all they valued about crypto in the first place. But with time, it is becoming clearer that this is not the case: in fact, the regulators and innovators in the decentralized technology space are in fact working together.

In February of this year, Chairman of the CFTC J. Christopher Giancarlo set the precedent for a cooperative relationship between the two sectors when he advocated for a “do no harm” approach to regulating cryptocurrency. “I believe that ‘do no harm’ is the right overarching approach for distributed ledger technology… With the proper balance of sound policy, regulatory oversight and private sector innovation, new technologies will allow American markets to evolve in responsible ways and continue to grow our economy and increase prosperity,” Giancarlo said.

While this may have seemed idealistic at the time, the government’s regard for decentralized, distributed technology has actually stayed relatively consistent over the last several months. Just last week, William Hinman, the director of the division of finance for the Securities and Exchange Commission (SEC) publicly declared that Ethereum is not a security. This came on the heels of a similar statement that SEC chair Jay Clayton made in April. “Based on my understanding of the present state of ether, the Ethereum network, and its decentralized structure, current offers and sales of ether are not securities transactions,” Hinman said. “And, as with Bitcoin, applying the disclosure regime of the federal securities laws to current transactions in ether would seem to add little value.”

In turn, Joe Lubin, co-founder of Ethereum and founder of major Ethereum application company ConsenSys, expressed gratitude for the SEC’s decision. “Ether and other next-generation consumer utility tokens will continue evolving the web towards networks that are more fair, secure, and evenly distributed. ConsenSys looks forward to continuing to engage with regulators around the globe to promote responsible adoption of this transformative technology” Lubin said, demonstrating the decentralized sector’s commitment to cooperation and transparency.

In my opinion, these announcements clear up some of the “regulatory uncertainty” that Tom Lee thought to be contributing to price stagnation in the crypto space and are a big win for the crypto industry as a whole.

  1. ICOs have taken a hit.

According to ICOData.io, ICO funding decreased from roughly $1.48 billion in January to around $288 million so far in June. June isn’t over yet, but that is a huge decline and cannot be ignored.

The SEC still considers most tokens purchased through ICOs to be securities, and that looming threat of regulation has likely discouraged some investors from participating in funding rounds.

Additionally, the SEC has cracked down on fraudulent ICOs in recent months, even going as far as launching its own illegitimate ICO as a warning to potential investors. Moreover, The Wall Street Journal conducted an investigation into ICOs and discovered that investors sank more than $1 billion into 271 ICOs that had clear red flags. All of these factors have likely played a role in the decrease in ICO funding across the industry. It is possible things will pick back up once the dust settles, but for now, launching and promoting a successful ICO is going to be an uphill battle.


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  1. Blockchain technology is on the rise.

There’s a misconception among those that are new to crypto that blockchain technology is only used for decentralized digital payment transactions, and that’s just not true. Blockchain technology can be leveraged for a variety of purposes, tracking transactions of all kinds, and it is soaring in popularity. The size of the global blockchain market is projected to reach $2.3 billion by 2021 and some of the world’s most prominent companies are already leveraging the emerging tech. One particularly exciting example is IBM Blockchain, a platform that enables companies from a wide range of industries – from retail to insurance – to reap the efficiency and transparency benefits that blockchain offers. And just yesterday, retail giant Walmart was awarded three blockchain-related patents. The first is for a medical records system that would enable patient data to be stored in a distributed ledger. The second is for a blockchain-based energy network, and the third is to allow consumers to securely control or limit access to a real or virtual space by leveraging cryptographic keys stored on a blockchain. So why does this matter for crypto? Because blockchain and crypto go hand-in-hand, so increased adoption of blockchain is inherently good for crypto.

These three trends will likely continue impacting the crypto industry in the coming weeks and months, but as with anything in crypto, there’s no telling what will happen next. The only thing we know for certain is that you can’t be certain of anything – and to me, that makes coming to work each day extremely exciting.

This article was written By Chris Kline, Co-founder, and COO at Bitcoin IRA

Three Reasons Not to Panic When the Crypto Market is Down

For novice consumers in the space, the hype can be overwhelming when prices are up and scary when prices are down. But it’s important to stay clear-headed in the midst of all of the buzz, and, when prices drop, to remember these three reasons why there is no need to panic.

We have seen this pattern many times before.

2018 is the third year in a row that Bitcoin and the overall market for digital coins plunged early in the year, according to a blog post called “The Perennial Dip” by Joe DiPasquale, the chief executive officer of Bitbull Capital. “It’s worth pointing out that this is nothing new for experienced crypto investors,” DiPasquale said, after sifting through crypto price data over the past three years. “Whenever the current ebb makes you nervous, just remember there’s another flow coming.”

Institutional Money is Entering the Crypto Sector

Many experts in the crypto community believe that the mainstream institutional adoption of crypto will inevitably drive up prices. “Institutional interest is now starting to grow regardless of the Google trends,” said CEO of Amex-backed crypto startup Abra Bill Barhydt back in March. “Once a large sizable chunk of Western institutional money starts to come in — watch out.”

Just a couple of months later, Wall Street has begun significantly warming up to crypto. In late April, Nasdaq announced a collaboration with cryptocurrency exchange Gemini in order to launch SMARTS market surveillance technology. “This is a major milestone in the application of SMARTS – and an important indicator of our commitment to expand the use of our market technology into non-traditional marketplaces, as well as new frontiers beyond the capital market,” said Senior Vice President and Head of Risk and Surveillance Solutions at Nasdaq Valerie Bannert-Thurner.

The momentum continued in May when Goldman Sachs also showed a commitment to expanding beyond traditional marketplaces by announcing that it would open a Bitcoin trading operation. “It resonates with us when a client says, ‘I want to hold Bitcoin or Bitcoin futures because I think it’s an alternate store of value,” said Rana Yared, one of the Goldman executives overseeing the trading operation.

May was also the month that thousands of crypto enthusiasts gathered at the Hilton Midtown in New York City for the Consensus conference. One of the largest crypto conferences in the world, Consensus drew over 4,000 attendees from leading industry startups, financial institutions, enterprise tech leaders, and academic and policy groups to discuss the future of digital currency economy and blockchain technology.

“Crypto still faces significant internal resistance and hurdles within traditional financial institutions,” said  Fundstrat Global Advisors Head of Research Thomas Lee. “But it is encouraging, nonetheless, that a large share of incremental attendance as financial institutions.” In fact, Fundstrat expects the price Bitcoin to go up tp $25,000 by the end of this year.

Increased Regulation is Improving the Crypto Economy in the Long Term

2018 has been a year of regulation for crypto, and the question that’s top of mind for both those that are new to space, as well as industry veterans, is: How will these newfound regulatory initiatives impact crypto prices?

Many leaders in the space are optimistic. “These technologies cannot flourish and grow without thoughtful regulation that connects them to finance,” said Tyler Winklevoss, chief executive and co-founder of the Gemini Exchange in a recent Bloomberg interview. “As long as jurisdictions strike the right balance, we think that it’s going to be a huge boon and win for cryptocurrencies.”

Aviya Arika, head of blockchain innovation at Porat & Co. Law Firm is an equally strong believer in regulation’s positive impact on crypto prices. “Contrary to what instinct may tell you, regulation actually makes cryptocurrency prices flourish…Generally speaking, I think that as more jurisdictions regulate and clarify legal statuses of cryptocurrencies, crypto markets will become substantially more stable and widely adopted.”


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I, too, am optimistic about this emphasis on regulation, as I believe that it will help weed out the bad actors and enable legitimate currencies and exchanges in the space to thrive. While there may be some more dips in the short-term and financial institutions and jurisdictions iron out their crypto regulatory guidelines in the coming months, I believe these regulatory measures will only help crypto prices in the long-term.

Furthermore, in the past few months, I believe a generally positive shift has taken place in the public ’s perception of crypto. The digital currency economy is no longer removed from the federal government and mainstream financial institutions. Rather, they are all working together to establish a financial landscape filled with more opportunity than ever before.

This article was written By Chris Kline, Co-founder, and COO at Bitcoin IRA

The Complete Cryptocurrency Guide

Bitcoin is arguably the most well-known cryptocurrency, yet there are many others that provide exciting investment opportunities. We teamed up with BitcoinIRA.com, the world’s first and largest cryptocurrency retirement platform, to break down some of the most popular cryptocurrencies on the market today – Bitcoin, Ethereum, Ripple, Litecoin, Bitcoin Cash and Ethereum Classic. Check out the below graphic to learn more about the functionality and benefits of each.

The Complete Cryptocurrency Guide

3 Reasons Why Bitcoin IRAs Are a Smart Retirement Strategy

Everywhere you turn, and even across political parties, the sentiment about retirement in America seems to share a rather uniform view: it’s bleak. According to a study published in 2017 by the National Institute of Retirement Security, 88% of Americans say that the nation faces a retirement crisis. When you get more specific, the statistics get even scarier: 21% of all Americans have $0 saved for retirement, and, if you’re looking at the millennial sector of Americans aged 21-32, that number climbs up to 66%. Above all else, there seems to be a general sense of confusion: 81% of Americans have no idea how much money they’ll need for retirement.

So, is the notion of retiring beachside with a margarita a thing of the past? Not necessarily. But now is certainly time to rethink strategy. And one of the crucial and often overlooked factors in a successful retirement portfolio? Diversification. “For a variety of reasons, people do not understand the value of having a highly diversified portfolio,” writes Barry Ritholtz in Bloomberg’s recent article “How to Avoid a Retirement Disaster.”

Some workers fear that investing in other stocks and assets will reveal a lack of corporate loyalty, while others, driven by wishful thinking, invest solely in their company’s stocks in the hopes that it will become the next Amazon, Apple, or Google. But, as Ritholtz explains, “That is a very intense concentration of financial risk. For those workers, diversifying their company stock into broad indexes is a prudent approach.”

Furthermore, it is also important to diversify across asset classes. Different assets, such as stocks and bonds, will not react in the same way to negative events, and a combination of assets is the best safeguard against a portfolio’s sensitivity to market swings.

As the COO of BitcoinIRA.com, the world’s first and largest cryptocurrency retirement platform, I talk to customers every day about how Bitcoin and cryptocurrencies, removed from third-party interference and stock market fluctuations, can function as a valuable asset class in a successfully diversified retirement portfolio. Here are a few reasons why.

A Rising Star in Wall Street Circles

According to CoinDesk’s comprehensive State of the Blockchain report for Q1 2018, 69% of people surveyed think that Bitcoin’s prices at the end of Q1 2017 are undervalued, indicating that the Bitcoin’s star is rising. This sentiment is largely reflected by the surge of mainstream acceptance that cryptocurrencies are seeing, particularly in the Wall Street domain.

The CME and Cboe were the first two institutions to launch regulated Bitcoin futures in 2017, serving as trailblazers for larger adoption in the mainstream finance world.

Since then, Goldman Sachs announced the first Bitcoin trading operation at a Wall Street bank, while Nasdaq has announced a collaboration with cryptocurrency exchange Gemini, and confirmed their interest in eventually becoming a crypto exchange as well.

In addition, Goldman Sachs alumnus, and billionaire cryptocurrency advocate Mike Novogratz just announced a partnership with Bloomberg to launch the Bloomberg Galaxy Crypto Index, which will track the performance of the ten most liquid cryptocurrencies. “This is just one more building block in the foundation that will get, at one point, pension funds and family offices and sovereign wealth funds all participating in the crypto economy.”

I believe that this shift towards mainstream acceptance indicates Bitcoin’s staying power as a viable long-term asset class for a diversified retirement portfolio.

A Complement to Gold  

Gold has been around for thousands of years, and its finite supply, as well its removal from the stock market, has helped earn its reputation as a notoriously reliable investment as well as a valuable hedge against inflation.

While Bitcoin has only been on the scene since 2009, it has already demonstrated similar merits. According to research published by ArkInvest and Coinbase, Bitcoin has already been recognized as “the only asset that maintains consistently low correlation with every other asset,” demonstrating its strength as a diversified asset in a retirement portfolio.


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A Groundbreaking Technology

Industries across a variety of sectors are recognizing that the decentralized blockchain technology that powers Bitcoin has major applications in a variety of enterprises. The decentralized blockchain technology that powers Bitcoin is already the way that many industries run the business. Facebook recently announced the launch of a blockchain research team, with interest in the technology’s application to such fields as data storage.

Amazon, too, just announced a partnership with a new start-up called Kaleido that makes it easier for customers to put their services on a blockchain. “Introducing Klaido to Amazon Web Services (AWS) customers is going to help customers move faster and not worry about managing blockchain themselves,” Amazon Web Services said in a statement, adding that it is the first Blockchain SaaS solution available on the AWS marketplace.

In my opinion, Bitcoin’s influence in the mainstream finance and technology sector is more powerful than ever. A distinguished asset alongside gold, I believe that Bitcoin will continue to prove itself as a valuable digital asset in a diversified retirement portfolio.

This article was written By Chris Kline, Co-founder, and COO at Bitcoin IRA

Goldman Sachs, JPMorgan, NASDAQ And Others Have Big Plans for Cryptocurrencies

Director of Financial and Risk Innovation at Thomson Reuters Sam Chadwick said that conversations with various clients have revealed that many hedge funds and other asset managers are showing increased interest in adding crypto to their portfolios. The increased enthusiasm is in line with a recent Thomson Reuters survey that shows one in five financial institutions have plans to start buying and selling crypto in the next 12 months.

In my opinion, this goes to show that the crypto world and the mainstream finance worlds are not, contrary to popular opinion, pitted against one another, but are rather working together to achieve a new financial landscape that is more compliant and diversified than ever before. Here are five financial institutions that either already has – or will shortly- incorporate crypto into their mainstream trading platforms.

CME and CBOE

The CME and Cboe were the two first institutions to launch regulated Bitcoin futures in December 2017, ultimately serving as the initial trailblazers in the trend towards mainstream crypto adoption.

“Futures are the first phase in bringing the Wild West of digital currencies to the mainstream. Next steps are ETFs (exchange-traded funds) and other national stock exchanges adding their own flavors of derivative products,” Charles Hayter, CEO of digital currency site Crypto Compare, said, which very much reflects the current changes taking place in the current landscape.

Goldman Sachs

Goldman Sachs, one of the most prestigious financial institutions, is opening the first Bitcoin trading operation at a Wall Street bank.

Many Goldman clients view bitcoin as a valuable commodity similar to gold. “It resonates with us when a client says, ‘I want to hold Bitcoin or Bitcoin futures because I think it’s an alternate store of value,” said Managing Director of Securities Division at Goldman Sachs Rana Yared, one of the Goldman executives overseeing the creation of the Bitcoin trading operation.

This trend is aligned with my belief that both crypto and gold draw striking parallels: both commodities are finite and act as a hedge against inflation, as well as economic and global volatility, as they are removed from the stock market and all governmental entities.

“In terms of having a trusted institutional player, it has been something I have been looking for in my own trading — but it didn’t exist,” said Justin Schmidt, Goldman Sachs’ first “digital asset” trader, in describing his decision to join the Goldman Sachs’ prestigious team.

Indeed, I believe that Goldman’s decision to move ahead and establish a Bitcoin trading operation makes them a trailblazer in setting a new standard for cryptocurrencies’ mainstream adoption.

Nasdaq  

Nasdaq CEO Adena Friedman confirmed that the Nasdaq is evaluating how to offer cryptocurrency futures in a different construct than competitors CME and Cboe, which both launched Bitcoin futures contracts in December 2017.

“Certainly Nasdaq would consider becoming a crypto exchange over time,” Friedman recently said. “I believe that digital currencies will continue to persist it’s just a matter of how long it will take for that space to mature. Once you look at it and say, ‘do we want to provide a regulated market?’ Certainly, Nasdaq would consider it.”

The Nasdaq recently announced a collaboration with cryptocurrency exchange Gemini. “Our deployment of NASDAQ’s SMARTS Market Surveillance will help ensure that Gemini is a rules-based marketplace for all participants,” said Co-founder and CEO of Gemini Tyler Winklevoss, further demonstrating that the crypto sector and mainstream financial institutions are working together to ensure that the crypto sector remains compliant, regulated, and fair.


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Morgan Stanley

According to an unnamed insider at Morgan Stanley, the financial institution is moving quickly to add cryptocurrencies to its trading products, with the goal of creating a specific desk for institutional traders, ICOs, and arbitrage. One unnamed source said: “Truth be told this is the next arms race. Everyone is rushing into cryptos. Everyone…It is the digital gold rush. And our firm wants to get there and pull as many levers as we can.”

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JPMorgan

In an ironic twist of fate, the financial institution that once denounced Bitcoin as a fraud is now facing a class-action lawsuit alleging that the bank overcharged its credit card customers when they used funds to buy cryptocurrencies. The bank, one of several institutions that banned customers from purchasing cryptocurrencies with their credit cards in February, had treated such expenses as “cash advances” back in January without notifying customers. “The complete lack of fair notice to Chase’s cardholders caused them to unknowingly incur millions of dollars in cash advance fees and sky-high interest charges on each and every crypto purchase,” the complaint said.

I believe that this lawsuit further confirms that Bitcoin is a force to be reckoned with. In my opinion, the increased regulation that the crypto sector is facing is a good thing, as it fosters transparency. But it should not be one-sided: this same transparency should also be expected from mainstream financial institutions.

For the record, JPMorgan CEO Jamie Dimon was later quoted as saying that he regretted calling Bitcoin a fraud.

Due to the increased regulation and the massive amounts of institutional money now being allocated to the crypto sector, I believe that it is only a matter of time before we see a dramatic price hike for Bitcoin and many other digital currencies.

This article was written By Chris Kline, Co-founder, and COO at Bitcoin IRA

4 Triggers for the Next Bitcoin Boom

As the founder and COO of BitcoinIRA.com, the first and largest Bitcoin IRA platform, I have witnessed this year’s significant Bitcoin price drop firsthand which has caused potential investors to approach the market with trepidation. Both current and prospective customers frequently ask me when the market will be rebound again. And while prices across digital currencies have dropped heavily in the first quarter of this year and nobody has a crystal ball to predict the future, I believe the start of our next big bull run is just around the bend.

Experts agree as well. For example, Thomas Lee, managing partner at the popular financial firm Fundstrat Global Advisors, anticipates a record peak for Bitcoin by July. Lee’s prediction is based on analysis from the currency’s 22 corrections since 2010, but here are some additional factors that could contribute to Bitcoin’s eventual spike.

SEC Approval & Regulation

Why is regulation needed?

When an industry scales and grows at lightning speed, increased regulation is inevitable. I believe that this is a good thing, as it is indicative of cryptocurrencies’ long-term staying power, and continued prevalence at the mainstream level. Regulating a once notoriously unregulated industry is undeniably nuanced territory, and for many in the space, it may require an attitude adjustment. We should stop looking at regulation as a hamper to the crypto space, and instead put that energy into working alongside the regulations to make this industry more compliant, transparent, and reliable than ever before.

I believe that SEC approval of crypto as a regulated security could drive walls of new institutional money, and is indicative of greater mainstream adoption of cryptocurrencies as a whole.

What’s the latest progress?

In early March, the U.S. Securities and Exchange Commission (SEC) issued a statement declaring that all cryptocurrency platforms that meet the definition of a “security” must register with the SEC as a national securities exchange. While this likely contributed to Bitcoin’s price decline in the short term, I believe this increased regulation ultimately serves the consumer’s best interests in the long term, as it provides a necessary level of oversight in safeguarding against scammy ICOs and hacks.

At least one regulatory body confirmed publicly that it does not want to prevent the growth of cryptocurrencies and the chairman of the U.S. Commodity Futures Trading Commission (CFTC) recently confirmed that by stating recently the need for balance and a “do no harm” approach when regulating cryptocurrencies.

Image: Chairman of CFTC, Christopher Giancarlo, stated a “do not harm” approach is needed when regulating cryptocurrencies
Image: Chairman of CFTC, Christopher Giancarlo, stated a “do not harm” approach is needed when regulating cryptocurrencies

I believe this new oversight will increase the trust in cryptocurrency transactions and will directly contribute to the next Bitcoin boom.

ETF approvals

What is an ETF?

ETF’s, or exchange-traded funds, are marketable securities that track an index, a commodity, bond, or a basket of assets like an index fund. An ETF is a type of fund that owns the underlying assets (shares of stock, bonds, oil futures, gold bars, foreign currency, etc.) and divides ownership of those assets into shares. The actual investment vehicle structure (such as a corporation or investment trust) will vary by country, and within one country there can be multiple structures that co-exist.


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Why could it drive up the price?

Traditionally, ETFs were created for products that are difficult for investors to hold (such as oil and gas). Similarly, setting up crypto wallets and executing trades can be considered difficult for average investors, so the potential of crypto-related ETFs may allow for simpler trading through brokerage accounts.

What’s the latest progress?

According to the SEC, “the agency has started the process to approve or disapprove a change in its rules that allows two Bitcoin ETFs to be listed on the NYSE Arca Exchange.” SEC approval for a Bitcoin ETF exchange will only further cement Bitcoin’s mainstream presence and likely also contribute to a massive price increase.

Lightning Network

What is the Lightning Network?

The Lightning Network is a decentralized network that uses smart contract functionality in order to enable instant payments across a network of participants. An “off-chain” solution that is built on top of the blockchain, the Lightning Network ahs transactions and scripts that are parsable and can be enforced on the blockchain if needed. The blockchain’s off-chain solution, however, allows transactions to be processed in a faster and with much lower fees than ever before.

Why could the Lightning Network drive up the price?

Elizabeth Stark, co-founder of Lightning Labs, says that the goal of the Lightning Network is to process “many thousands of transactions per second and maybe someday even millions of transactions per second,” surpassing the capabilities of traditional credit card companies like Visa.

With this kind of technical innovation in the works, Bitcoin prices have potential to soar. But it may take a little bit of time. As Stark said herself: “Bitcoin is a marathon, not a sprint. People wanted it to be a sprint.”

What’s the latest progress?

On March 15, Lightning Labs launched a beta version of its Lightning Network (LND) software specifically available for the developer community. Designed to tackle some of the legacy blockchain’s obstacles surrounding high fees and slow transaction times, LND uses smart contract functionality to enable payments and process transactions of the blockchain.

Retailer Acceptance (e.g. Amazon)

How many retailers currently accept Bitcoin today?

Bitcoin is currently accepted at several major retailers, including Overstock.com, Expedia, Microsoft, and about another 100 stores with more growing very quickly.

I believe that more retail acceptance will increase the number of transactions, wallets created and overall Bitcoin holdings as consumers purchase Bitcoin in order to pay for goods and services.

What’s the latest progress?

Coinbase is aggressively moving into the retail space with the launch of their new product: Coinbase Commerce. This enables retailers to accept bitcoin alongside traditional choices such as credit card or PayPal.

Image: Coinbase commerce
Image: Coinbase commerce

Also, Amazon has secured some cryptocurrency domains, and Starbucks CEO Howard Schultz has expressed his interest in using cryptocurrency for large-scale retail adoption. “I personally believe that there is going to be one or a few legitimate trusted digital currencies off of the blockchain technology. And that legitimacy and trust in terms of its consumer application will have to be legitimized by a brand and a brick and mortar environment, where the consumer has trust and confidence in the company that is providing the transaction.” Schultz said. With Starbucks’ mobile app already redefining the customer experience in its brick and mortar stores, adding cryptocurrency seems like a natural progression and one that has potential to contribute to the next Bitcoin boom.

 The writing is on the wall: with so much momentum surrounding Bitcoin and other digital currencies, in my opinion, it’s only a matter of time before prices rebound again.

This article was written By Chris Kline, Co-founder, and COO at BitcoinIRA.com

Bitcoin is Evolving Just Like Amazon

Volatility, however, is an indicator that a potentially powerful force is coming into its own. In this regard, one might think of Bitcoin as a new Amazon: navigating some growing pains but developing innovative solutions to help solve them.

At this point, it’s safe to say that Amazon has achieved retail dominance, and while Bitcoin’s story is in a much more formative phase, its monumental upward trajectory points to its increasingly dominant role in the global financial landscape.

bitcoin amazon 1

Amazon’s Early Struggles Mirror Bitcoins

Amazon, established in 1994, was originally born out of Jeff Bezos’ vision to establish “the world’s most consumer-centric company, where customers can come to buy everything they want online.” Given Amazon’s larger-than-life presence in the retail landscape today, it can be hard to remember the company in its infancy, when it was merely an online bookseller. Like most companies intent on scaling their vision, Amazon faced its fair share of growing pains and challenges in the early days, as many customers were initially wary of online shopping and additional shipping costs. While Amazon Prime, a subscription-based service offering free two-day shipping alleviated some of these concerns, it still took time for the company to gain steam and build credibility at the global level.

Meanwhile, Bitcoin, which was born in 2009 out of the financial crisis and established in order to “create a purely peer-to-peer version of electronic cash that [would] allow online payments to be sent directly from one party to another without going through a financial institution,” has also encountered its share of obstacles scaling its vision. Particularly, the legacy Bitcoin blockchain that powers Bitcoin transactions faces slow transaction processing times and high transaction fees.

But much like the developers at Amazon working tirelessly to develop new, innovative solutions, a passionate group of developers in the crypto community have been actively involved in refining old platforms and building new ones in order to present a growing number of solutions to meet a wide range of technical issues.

Amazon Pivoted to Succeed and Bitcoin Is Too

Amazon may have begun as an e-tailer marketplace, but the company quickly expanded its range of offerings by creating many of its own niche products and services, ranging from the Amazon Kindle to personal assistant Alexa. The company has also demonstrated its desire to tap into other sectors, whether by acquiring Whole Foods and reimagining the experience of shopping at a grocery chain or working with Berkshire Hathaway and JPMorgan to control costs and reduce spending on health insurance.

Similarly, the cryptocurrency community has also been hard at work implementing platform changes to meet a growing array of user needs. The Lightning Network, a decentralized network that uses an “off-blockchain” solution in order to enable instant payments across a network of participants, is expected to launch sometime in the new future, solving the legacy Bitcoin blockchain’s scalability problem.

Furthermore, just as Amazon staked its claim as a company with versatile offerings that far surpassed its e-commerce platform, the cryptocurrency community has been actively developing technical platforms with offerings that stretch far beyond alternative payment systems. Two particularly noteworthy examples? Ethereum and Ripple.

Ethereum And Ripple Are Evolving Like Amazon’s Alexa

While Amazon may be leading the charge in cutting-edge fields like artificial intelligence, Ethereum is paving the way for a new relationship with Amazon as well as smart contract technology and decentralized applications.

Ripple, too, which has two primary products for banks (xCurrent and xRapid), has demonstrated its wide range of capabilities that far exceed its function as native cryptocurrency XRP.

Indeed, the constant innovation and implementation in the cryptocurrency community ensures that, much like Amazon, the digital currency space is continuing to grow, improve, and reshape business and commerce as we know it.

The New Amazon: Bitcoin Moving Past Its Infancy

The fact that Bitcoin has moved from a mere concept in a white paper drafted during the 2008 financial crisis to one of many influential digital currencies over 10 years later is a testament to the fact that cryptocurrency is more than just a fad. Like Amazon, it will demonstrate that disruption of an industry is never without its speed bumps along the way.

This article was written By Chris Kline, Co-founder, and COO at BitcoinIRA.com