At a recent conference, a question was asked about whether it’s still possible to get rich from the stock market. It has never been easier to get rich from stock investing. We will see nearly 2 billion jobs disappear, everything from physicians and lawyers to grocery clerks. In the next 20 years, half of the companies that currently make up the S&P 500 index will be gone. Standing armies will be automated in the next two decades, too.
By 2030, 15% of all global financial transactions will use Bitcoin or a Bitcoin-like crypto-currency. In fact, cryptocurrencies are the one investment class where a relatively small purchase could literally make you a millionaire in a very short time. The cryptocurrency market itself is up more than 170% YTD. A $100 purchase of Bitcoin in 2010 is worth a cool $3 million today.
There are more than 800 cryptocurrencies in existence today — and a few of them, like Ethereum, Ripple, NEM, and Litecoin, will likely see similar growth. Banks are spending nearly $1 billion a year on researching digital currencies.
You may ask: why is Bitcoin better than any other commodity? Why would someone looking for an alternative to government-issued currency not buy gold instead?
On the other hand, you could easily carry millions of Bitcoin on a thumb drive with nobody the wiser. This makes Bitcoin safer and easier to use than gold. But cryptocurrencies are still speculative. While millions of profits will be generated on cryptocurrencies, investors must treat them as speculative investments. That makes it well worth taking on some risk in a speculative environment.
To mitigate risk, perhaps relegate your purchase to any of the five cryptocurrencies with the best odds of exponential growth (Bitcoin, Ethereum, Ripple, NEM, and Litecoin). This is a long term-investment, so expect to hold the currency for more than five years (buy and forget).