Crypto has made a loud entry into American politics.

President Joe Biden’s surrogates and the US left wing, led by Senator Elizabeth Warren, want to take down the industry with crippling reporting standards.

Then, in typical style, Donald Trump has taken a diametrical stance, accepting cryptocurrency donations and declaring that Biden and the SEC are “very much against it.”

The battle lines are drawn, and the President’s party is getting nervous.

So much so that, against all odds, the SEC suddenly approved applications for an Ethereum ETF.

Expectations of this news pumped Ethereum’s price by 25%, the largest single-day increase in the asset’s history.

Alt Macro readers have been ahead of this narrative since the January 15th publication. You’re sitting on a 44% gain today if you acted on it.

That’s some sweet alpha, and here’s some more for you.

Before we continue, please bear my rude interruption… Have you told your friends about Alt Macro?

Alternative investing shouldn’t just be for hedge funds and the ultra-wealthy.

Alt Macro is written for individuals like yourself to stay ahead of the pros.

If you feel like this publication would benefit people you know, please refer your friends using the button below.

5 referrals unlock your first reward: Free access to the “Bitcoin for non-techies” course.

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Separation of money and state?

We have two visions for the future of money.

Just like the church and state became separate authorities, some envision decoupling money and government.

Others see a broader role for central banks by creating Central Bank Digital Currencies, abbreviated to “CBDC.”

The former are typically Bitcoiners who want a currency with a deflationary supply that allows independent self-custody. They believe that excessive money printing by central banks and the government's power to freeze bank accounts erode sovereignty and freedom.

Then there’s the idea of creating a fully electronic cash system that is programmable, traceable, and easy for central governments to manipulate. This is the direction that most countries are headed.

Whether or not we are handing over too much power with CBDCs is a deep subject. Research and decide for yourself.

Crypto is now political

This week was monumental for crypto.

Trump vocalized his support, and the US House passed a Republican-led bill by 216-192, preventing Biden from creating a CBDC.

The CBDC Anti-Surveillance State Act got the backing of only THREE democrats.

Then, in a sudden and unpredictable turn of events, the SEC approved a set of applications for Ethereum ETFs, effectively confirming that it’s a political arm of the ruling Democratic party.

With anywhere between 62% and 94% of Gen Z and Millenials owning crypto, the parties need to appease a growing voter bloc, and the SEC’s swift action confirmed their growing clout.

A budding narrative

Four months ago, we discussed the possibility of Ethereum being the greatest beneficiary of Bitcoin’s ETF approval.

Then, based on the SEC’s actions (or lack thereof), the odds of its approval dropped.

Their swift U-turn this week revealed their political motivations, and it’s now evident that crypto will be a central issue in the US presidential election.

More than ever, bitcoin and crypto prices will correlate with political and legislative dynamics.

So here’s the one-line takeaway: If Trump wins, crypto moons.

Do you think crypto will win regardless of this Presidential election? Leave me a comment or hit reply if you’re reading this from your inbox—I would love to hear from you!

Disclaimers:

1. The author owns the digital assets or cryptocurrencies mentioned in this article.

2. All material on the Alt Macro web/server and newsletter is not investment advice, but is for general information only. You are solely responsible for making your own investment and financial decisions. Owners of this newsletter, its representatives, its principals, its moderators, and its members, are NOT registered as securities broker-dealers or investment advisors either with the U.S. Securities and Exchange Commission or with any securities regulatory authority.

One investment theme we’re closely following at Alt Macro is that innovation comes in cycles, creating new incumbents while discarding companies that struggle to remain relevant.

Think Kodak, Nokia, Blockbuster, and other economic powerhouses that didn’t make it in the digital era.

Investors have a lot to gain by staying ahead of these cycles and predicting their winners and losers, and this thesis has a juicy update that involves the legend himself: Warren Buffet.

He has largely missed the tech industry’s exponential rise, but he’s raked in big profits by making Apple Berkshire Hathaway’s largest single holding.

Most recently, though, Berkshire has been offloading millions of Apple shares since the beginning of the year, selling 15% of their bag over the last two quarters.

Warren Buffet explains that he expects taxes to rise, erasing any profits from holding longer. Smart words from a man who could easily tank a company’s share value with the slightest sign of bearishness.

I wager that the legendary investor realizes he’s holding a company struggling to keep pace.

If he and his boardroom pals took their noses out of Apple’s financial statements and shared their macro views of the company over cigars and whiskey, here’s what they would likely be saying to each other.

Before we continue, please bear my rude interruption…

Alternative investing shouldn’t just be for hedge funds and the ultra-wealthy.

Alt Macro is written for individuals like yourself to stay ahead of the pros.

If you feel like this publication would benefit people you know, please refer your friends using the button below.

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Apple’s got issues

Apple’s iPhone was the most important innovation that started the current tech era. For the last 16 years its flagship device has remained its biggest moneymaker, representing 58% of its overall revenue. But the company has hit some turbulence.

The iPhone’s global market share and number of units sold have flatlined since 2022:

• Apple shipped 226 million phones in 2023, one million fewer than the previous year.

• The iPhone represented 16% of global smartphone sales in 2022 and 2023, unlike the preceding four years, which saw incremental growth in the overall market captured.

It sounds like a little hiccup for the tech behemoth, but it’s worth noting when trends change from rapid to flatlining growth.

Especially since Apple is running out of ideas to maintain its status as a tech pioneer and deliver the kind of growth that shareholders have gotten used to.

Apple and Web 3.0

AI, blockchain, and the Metaverse are three innovation themes that will set the stage for the next wave of tech - what they call “Web 3.0”. The future of big tech companies rests on how they will perform on these themes.

Here’s how Apple is faring:

Artificial Intelligence:

• Apple has lagged on this front and is struggling to keep up with competitors who have more advanced AI models. They’re building the usual use cases such as image generation, prompt-based image editing, and cell phone navigation. Nothing groundbreaking that will set it apart from the pack.

• As a stop-gap, so they don’t fall too behind, they’re building partnerships with other market leaders like Google to integrate their Gemini AI engine to their next iPhone version. Other agreements with OpenAI and Baidu (for China) are also in the works.

Blockchain:

• This is a strange one. Tim Cook (Apple’s CEO) and Steve Wozniak (Cofounder) both talk highly of Bitcoin and admit to holding some in their personal portfolios. In a world where forward-looking companies are switching their currency reserves to Bitcoin, Apple has shown no inclination in this direction despite holding billions of dollars in cash.

• The company has blocked and placed stringent restrictions on crypto-related platforms and briefly removed popular wallets like Metamask and others. This is not the sign of a company about to lead in the field of blockchain tech.

Metaverse:

• This is all about Apple’s latest product - the ‘Vision Pro’. It’s an AR/VR headset that Apple is differentiating by dubbing a new category, calling it ‘spatial computing’.

• Retailing at $3,500 per unit, the Vision Pro isn’t made for mass adoption. The company expected to sell 800,000 units this year but is now slashing this forecast by 50%.

• Despite offering an awesome experience, the Vision Pro doesn’t offer a significant divergence from regular laptop computing, or watching video on a large-screen TV.

Inside Berkshire’s boardroom

Buffet and his team of gurus will understand there’s work to be done at Apple and are likely taking some risk off the table with their latest sale. The company is beginning to look like Microsoft ten years ago when it was behind on all fronts - cloud computing, smartphones, operating systems and the like.

With cash on hand and a new CEO, Satya Nadella steered Microsoft to a 1000% increase in share value since 2014.

With well over a billion dollars in reserves, Apple isn’t going anywhere, but they will need to hit a bull’s eye or two before they can see a turnaround like Microsoft’s.

It took Microsoft a whole decade for its turnaround. Will you be shorting Apple or expect their billions to dominate in their next round of tech innovation? Leave me a comment, or hit reply if you’re reading this from your inbox - I would love to hear from you!

I recently chatted with my uncle in India. He recounted the days he had to stand in line for hours to pay his monthly bills—utilities like electricity, telephone, and water connections.

“And now, my bank just tells me in my email (sic) when they’ve taken the money!” he said, eyebrows raised, eagerly thumbing through the apps on his phone as if proud to show me how many he had downloaded.

A lot has changed throughout my lovely boomer uncle’s life.

In tech’s next inning, or “Web 3.0”, the utilities he is so happy to pay for with such ease may become unrecognizable.

Your friendly local oligopolies - the power company, internet service providers, and giant telcos - are all in the crosshairs of an emerging Web 3.0 trend.

It’s called “DePIN” - short for Decentralized Physical Infrastructure Networks.

It’s sexy technology with a drab name.

To make up for the lousy branding, a lot is going for it.

For example, one DePIN project rolled out a wireless network to 161 countries and 34,000 cities in just one year.

It’s the fastest growth of network infrastructure in history.

Before we continue, please bear my rude interruption…

Alternative investing shouldn’t just be for hedge funds and the ultra-wealthy.

Alt Macro is written for individuals like yourself to stay ahead of the pros.

If you feel like this publication would benefit people you know, please refer your friends using the button below.

5 referrals unlock your first reward: Free access to the “Bitcoin for non-techies” course, scheduled for release on March 31st, 2024.

Your support will allow me to continue sending you new opportunities, which I hope will transform your financial life.

Refer a friend

…And now, back to regular programming

Oligopolies are so yesterday

Chances are that you hate dealing with the companies that provide your electricity, cell phone service, or internet connections.

Energy and telecom providers are the largest companies in the world, and they regularly rank the lowest of all industries in net promoter scores, or ‘NPS’ - a measure of customer satisfaction.

Oligopolies like these have high barriers to entry - it takes billions of dollars to set up the equipment (“capex”) and logistics to deliver AT&T’s cellular service, for example. The sheer amount of capital needed prevents new players from entering the game, and the lack of competition takes away any incentive to keep customers happy.

These oligopolies also get the luck of the draw with regulatory frameworks.

This power dynamic stifles innovation, inflates prices, and makes you wait countless hours after hitting “0” for the privilege of speaking to someone from customer service.

Just like my uncle was giddy about the conveniences that technology brought to his life, we may soon breathe a sigh of relief when we finally land some competition for our utility providers.

We have an army of nerds coming to our rescue, and I’m hopeful for them.

Here comes DePIN

DePINs counter the capital advantage of oligopolies by crowdsourcing costs and using a trustless and immutable ledger, or a blockchain, to incentivize members to maintain and expand the network.

Helium - a decentralized internet service provider and the most established DePIN - is a great case study for visualizing this process.

Helium uses a technology called LongFI that gives its network a cheap and long-range data frequency band.

Anyone purchasing a ‘Helium Miner’ - a high-performance wireless hotspot - can transmit the network for miles.

Rewards for propagating this data network are delivered via its blockchain-based incentive system. Participants receive the native Helium token, “HNT,” redeemable for USD or other fiat currencies.

These payouts are adjusted according to coverage and demand.

A similar blockchain-based incentive structure can be used to create or supply power grids.

Homeowners with solar panels can feed their local grid with the surplus energy they produce while receiving compensation. In this setup, equipment costs (solar power kits) are crowdsourced, and the blockchain ensures a transparent and secure structure for the network’s growth and operations.

The magic of DePIN is in its ability to incentivize a network of people to work towards a shared goal.

Beyond big infrastructure

It’s not just the multi-billion dollar service networks that DePIN is going after.

Digital resources—such as file storage, bandwidth, and the data you capture of your surroundings—can also be shared on a network:

Filecoin is a network of cloud storage providers that rivals centralized players - such as Microsoft’s Onedrive and Google Drive - but with all the security and advantages of the blockchain. Miners provide the network with storage capacity and are rewarded with the ‘FIL’ token.

Hivemapper crowdsources traffic and terrain data. Drivers can place Hivemapper’s dashboard cam on their vehicle to capture live footage of their city. of

Render is a network of high-performance processors (‘GPUs’) that gives 3D artists access to substantial on-demand computing power.

Anyone with a couple thousand dollars can buy some hardware, get it on the network, sit back, and meditate on the sweet sound of cash rolling in.

How to play this

I would rather have the extra time in my day for a spontaneous siesta than learn how to become a miner with new hardware and futuristic tech.

If you’re like me, there’s some good news.

You can invest in a DePIN network without being an active participant by simply acquiring its native token.

This is what’s used to pay for the service, and as demand for the network grows, so will the token value in US Dollars.

You’ll also have the bragging rights of investing alongside VC A-listers such as a16z, Sequoia Capital, Outlier Ventures, etc.

Yes, they’re all investing in DePIN, and you can too.

The few largest projects have attracted the vast majority of funding in this space, and they’re all accessible on easy-to-use exchanges.

Coinbase, Kucoin, Bybit, and Binance will give you access to the most established DePINs such as Helium (HNT), Fetch.ai (FET), Filecoin (FIL), Livepeer (LPT), Hivemapper (HONEY) and others.

Before investing, don’t slack on the due diligence and always remember that you’re taking on a high-risk bet when investing in nascent technologies.

Will we organize large capital-intensive businesses using DePIN, or is this just another nerdy wet dream? Leave me a comment, or hit reply if you’re reading this from your inbox - I would love to hear from you!

Disclaimers:

1. The author owns some of the digital assets mentioned in this article

2. All material on the Alt Macro web/server and newsletter is not investment advice, but is for general information only. You are solely responsible for making your own investment and financial decisions. Owners of this newsletter, its representatives, its principals, its moderators, and its members, are NOT registered as securities broker-dealers or investment advisors either with the U.S. Securities and Exchange Commission or with any securities regulatory authority.

Today marks two months since the SEC approved the first spot Bitcoin ETFs on January 11th.

The Alt Macro edition covering this watershed moment discussed what it meant for Bitcoin as an asset while speculating on the hidden investment opportunities that could arise from it.

In particular, this approval may boost the chances of a spot Ethereum ETF (the second largest cryptocurrency after Bitcoin), therefore opening up an even greater opportunity for investors.

Eight weeks ago is a lifetime. For those following this investment narrative, here’s where things sit.

Right after the ETFs launched, the price of Bitcoin crashed by 20% the following two weeks, in typical fashion for a “buy the rumor, sell the news” type event, as speculators look for quick profits from the market hype.

Once the shakeout was complete, Bitcoin’s price found support at around $38,000 and steadily increased to its current record high—set today at $72,000.

That’s a whopping 87% rise over the last six weeks, and it’s all driven by Bitcoin’s supply dynamics.

The ETFs are gobbling up 10 times Bitcoin’s daily supply, while long-term “hodlers” aren’t opening their purses. Despite the price rally, 80% of all Bitcoin has not moved over the last six months.

Demand from the ETFs is relentless, holders aren’t selling, and Bitcoin’s supply is set to halve next month.

I got a C in Economics (hey, it’s still a passing grade), and even I know that demand exceeding supply leads to higher prices.

The supply crunch is here, and it’s real.

Before we continue, please bear my rude interruption…

Alternative investing shouldn’t just be for hedge funds and the ultra-wealthy.

Alt Macro is written for individuals like yourself to stay ahead of the pros.

If you feel like this publication would benefit people you know, please refer your friends using the button below.

5 referrals unlock your first reward: Free access to the “Bitcoin for non-techies” course, scheduled for release on March 31st, 2024.

Your support will allow me to continue sending you new opportunities, which I hope will transform your financial life.

Refer a friend

…And now, back to regular programming

Bitcoin’s historical moment

The ETF approvals were Bitcoin’s quinceañera, a coming of age, and revelation to mainstream boomer investors. The wealthiest generation in history can now make a phone call to their trusted broker and buy Bitcoin just as they would a stock or a mutual fund.

Speaking of trusted brokers, one Blackrock analyst is talking about a 28% portfolio allocation to Bitcoin for an optimal risk-to-reward ratio(!).

Boomers haven’t even gotten started, and Bitcoin’s price is already at an all-time high.

To fully grasp the success of Bitcoin’s ETFs, let’s look at it in the context of gold.

Bitcoin and gold have a fixed supply, so they’re seen as inflation hedges or for times of ‘monetary debasement’— when money printing goes haywire.

They’re designed to protect investors from uncertainty.

In times like now.

We’re coming to grips with potential changes in monetary policy (interest rates), geopolitical crises, and concerns about a possible stock market crash. Inflation is a constant, and the most recent numbers reveal a world economy in trouble - even though the stock market is breaking records.

Within this context, here’s how Bitcoin has been performing relative to gold:

• Over the past two months, total flows into the nine new spot Bitcoin ETFs exceed total flows into all physical gold ETFs over the past five years.

• In seven weeks, Blackrock’s Bitcoin ETF crossed $10 billion in value. The Gold SPDR ETF, launched in 2004, took two years to reach this number.

• Gold has increased 4% since the beginning of the year, compared to Bitcoin’s 69% skyrocket.

Physically backed gold ETFs currently have $91 billion worth of assets. Bitcoin has already achieved 57% of this within just two months ($52 billion in total assets at the time of writing this).

It’s the most successful ETF launch ever. Bitcoin is making financial history.

Bitcoin’s bridesmaid

When investors get excited watching their profits go up, they start looking over their shoulders for the next wave to catch.

There’s a chance that Bitcoin profits may be swayed towards Ethereum if its ETF applications are approved.

Ethereum is the second-largest cryptocurrency, right behind Bitcoin. Seven applications for a spot ETF are pending approval by the SEC. A green light is expected to open the floodgates, and Ethereum’s value would be carried upward by its larger peer’s momentum.

When this narrative was forming two months ago, the odds of approval were slightly over 80%. This has now come down to 38% when writing this.

The static silence from the SEC on this matter is throwing shade on the process.

I’m following Eric Balchunas - senior expert on ETFs for Bloomberg - to keep up.

According to him, the SEC “begrudgingly” allowed the Bitcoin ETF, and it took a lawsuit to force their hand. This time, no legal proceedings hover over their decision, and the SEC may likely deny the Ethereum applications to ease the political blowback they received for allowing Bitcoin’s.

SEC Chairman Gary Gensler’s disdain for Bitcoin (and crypto in general) is real.

Here’s a snippet from his announcement on the Bitcoin ETF approvals: “(Bitcoin is) primarily a speculative, volatile asset that’s also used for illicit activity including ransomware, money laundering, sanction evasion, and terrorist financing.”

Thanks for the reminder Gary, we know how much you want to protect our interests.

Beyond ETFs

Ethereum may have priced in the possibility of an ETF approval, so a disappointing outcome could drop its price. Crypto natives would likely swoop in, knowing what the upcoming ‘Dencun upgrade’ could do to exponentially increase innovation in the Ethereum ecosystem.

ETF or not, the success of Bitcoin opens the doors for the proliferation of blockchain-based solutions.

Ethereum’s potential goes beyond the whims of the SEC.

What do you think Bitcoin’s bullish price action says about the markets? How are you playing these markets? Leave me a comment or hit reply if you’re reading this from your inbox - I would love to hear from you!

Disclaimers:

1. The author owns the digital assets mentioned in this article, Bitcoin and Ethereum.

2. All material on the Alt Macro web/server and newsletter is not investment advice, but is for general information only. You are solely responsible for making your own investment and financial decisions. Owners of this newsletter, its representatives, its principals, its moderators, and its members, are NOT registered as securities broker-dealers or investment advisors either with the U.S. Securities and Exchange Commission or with any securities regulatory authority.

If you’re holding a bag of stocks or crypto and your numbers haven’t been inching upward, you’re doing something seriously wrong.

Markets are hot, and valuations are coming close to, or even surpassing, all-time highs.

The number crunchers of Wall Street are pulling longer hours, dissecting indicators, and devising their perfect entry and exit points.

That’s why today’s Alt Macro edition will be slightly different.

When “number go up” all around us, the best alpha isn’t from uncovering gems; instead, it comes from standing apart from the sentiment of the herd. It’s about staying cool when everyone else is losing their marbles.

Instead of going with the flow, you paddle against it.

Mastering emotions, not numbers, separates profitable investors from those left holding the bag when the markets crash (and they will).

Here’s how you channel your inner Marcus Aurelius and work the markets like a Stoic.

Before we continue, please bear my rude interruption…

Alternative investing shouldn’t just be for hedge funds and the ultra-wealthy.

Alt Macro is written for individuals like yourself to stay ahead of the pros.

If you feel like this publication would benefit people you know, please refer your friends using the button below.

5 referrals unlock your first reward: Free access to the “Bitcoin for non-techies” course, scheduled for release on March 31st, 2024.

Your support will allow me to continue sending you new opportunities, which I hope will transform your financial life.

Refer a friend

…And now, back to regular programming

The only cheat sheet you’ll need

(Image by Jean-Paul Rodrigue)

This chart maps how herd mentality evolves during the market cycle stages.

Like a good Stoic, the only question you need to ask yourself to be a successful investor is: What phase of the market cycle are we in?

The answers are all around you, quite literally.

What are the talking heads on CNBC saying? What’s the word on Twitter (or ‘X’)? How are your friends and neighbors feeling?

Deciphering the market cycle

The Stealth Phase is a cautious one. Everyone is licking their wounds from the recent market crash, and the few glimmers of hope that arise quickly fade away. Everyone regrets not selling when prices were high - but quietly, and below the surface, markets are slowly ticking upwards.

This is when Stoics of “elite ninja” status buy into the market.

The Awareness Phase turns up when people look at their bags (if they’re still holding them) and realize they don’t look as shabby as they once did. There’s a bit of optimism about where things are going. Some buy into the market, but traumas from the past scare them into selling at any slight downturn (the “bear trap”).

This is when the rest of the (not-so-elite) Stoics buy into the market.

Mania Phase kicks off when everyone realizes that things are finally looking up. Excitement is the predominant emotion, and before you know it, the highs of the previous cycle are within reach. Life is good, and you start ordering a side of guacamole at Chipotle again.

By now, the Stoics are fully bought in and watching “number go up” with an eye on taking profits.

And finally comes the Blow Off Phase. The excitement hits a crescendo, and everyone is FOMO’ing in, afraid to miss the generational opportunity. Things get delusional. Celebrities are shilling dog and cat cryptocurrencies, and everyone thinks the stock market will never crash.

The Stoics have cashed out, and their profits are ready to be redeployed after the next crash.

The Way of the Stoic

If Marcus Aurelius had to conquer Wall Street, this would be his approach:

1. Don’t let past scars blind you. New trends emerge, and you’ve got to be open-minded. Otherwise, you’ll miss the train.

2. Hope is good, but don’t get carried away. Stay grounded. Accumulate knowledge (and maybe some stocks) when you’re feeling it.

3. Optimism is contagious, but don’t lose your head. Keep your wits about you. Remember, trends don’t last forever.

4. Euphoria blinds. Stay rational. Set exit strategies. Don’t hang on to your bags while the markets crash.

And finally, here’s the question you’ve been waiting for… What market cycle phase do you think we’re in right now? My tea leaves tell me that we’re about to see some manic moves upward ;)

Stay safe, stay Stoic, take profits.

Did I miss anything? How do you plan on navigating this phase of the bull market? Leave me a comment or hit reply if you’re reading this from your inbox - I would love to hear from you!

Disclaimer: Material on AltMacro.com and the Alt Macro newsletter is not investment advice but is for general information only. You are solely responsible for making your own investment and financial decisions. Owners of Alt Macro, its representatives, its principals, its moderators, and its members, are NOT registered as securities broker-dealers or investment advisors either with the U.S. Securities and Exchange Commission or with any securities regulatory authority.

We’re obsessing over solutions for a declining human population, but the more immediate threat is the additional 2 billion people we will have to feed 25 years from now.

Global food production must increase by almost 50% to meet this demand.

Then, we have to consider geopolitical crises, climate disasters, and black swan events like COVID, which break trading systems and make growing food even harder.

We’re crammed on a tiny planet fighting for depleting resources, and the world’s billionaires know it.

They understand that when shit hits the fan, what keeps us alive becomes most valuable: clean water, fertile soil, food, and fresh air.

That’s why Bill Gates, Jeff Bezos and Thomas Peterffy own almost 1.3 million acres of US farmland combined.

And that’s why the who’s who of Silicon Valley have come together to buy $800m of land to build themselves an agrarian utopia with an orchard containing a million trees and…. a military base.

Unlike in the Lord of the Rings, this shire wouldn’t be as hospitable to outsiders.

Bulletproof yourself

Warren Buffet once said that the first rule of investing is not to lose money. And the second rule is to remember the first rule.

Farmland as an asset has proven its mettle when preserving wealth in tough economic conditions.

Rising interest rates have crashed the real estate market. However, farmland has seen just a 1% reduction in value throughout 2022-2023. And during inflationary times, like now, rising food prices make farms more profitable.

Beyond saving you from the downside, farmland delivers rental income (when leased out to farmers) and gains from increasing land value. With more land flipping from agricultural to commercial use, its growing scarcity improves its potential:

• Investors have seen an average return of 11% annually from 1992-2021

• The price per acre of US farmland has gone from $1,270 in 1997 to $5,460 in 2023

There’s a catch

The same climate-related disasters that farmland can protect you from pose its greatest risks.

Lack of usable groundwater, droughts, insect infestations, strong winds, wildfires, and flooding are some examples. Investigating an area’s water access and history of disasters is crucial.

Secondly, crops have volatile prices, making income unpredictable for farmers or land tenants.

This requires keeping a close eye on the numbers and always having enough cash to ride out the low seasons.

Farmland for the everyday investor

The most obvious way to invest would be to buy agricultural land, but this requires a lot of upfront capital and ongoing costs for maintenance. For non-farmers, it would mean finding and managing tenants that would work the land.

Other investment methods require investor accreditation, which locks out anyone with a net worth below $1 million.

The easiest and most straightforward way to access farmland as an investment asset would be to buy into a Real Estate Investment Trust (‘REIT’) - easily done with a brokerage account. One such fund is Gladstone (‘LAND’), which owns and leases out 112.5 million acres of farmland. Another is Farmland Partners (‘FPI’). They own almost 186,000 acres and other farm assets, such as granaries and groundwater rights.

Beyond its potential to sweeten your balance sheet, owning agricultural land comes with the benefits of breathing clean air, eating fresh foods, and getting outside. You’ll appreciate it the next time the world’s locked down from a rogue virus.

Did I miss anything? Do you think owning Farmland can make you more resilient during a crisis? Leave me a comment or hit reply if you’re reading this from your inbox - I would love to hear from you!

Alternative investing shouldn’t just be for hedge funds and the ultra-wealthy.

Alt Macro is written for individuals like yourself to stay ahead of the pros.

If you feel like this publication would benefit people you know, please refer your friends using the button below.

5 referrals unlock your first reward: Free access to the “Bitcoin for non-techies” course, scheduled for release on March 31st, 2024.

Your support will allow me to continue sending you new opportunities, which I hope will transform your financial life.

Refer a friend

Disclaimer: Material on AltMacro.com and the Alt Macro newsletter is not investment advice but is for general information only. You are solely responsible for making your own investment and financial decisions. Owners of Alt Macro, its representatives, its principals, its moderators, and its members, are NOT registered as securities broker-dealers or investment advisors either with the U.S. Securities and Exchange Commission or with any securities regulatory authority.

In the 90s, we were mailing handwritten, postage-stamped letters to each other.

We can thank digitization for making this sound like a practice from the Victorian age.

The contrast between today's world and two decades ago is just as great when looking at trade, media, communication, and how we consume information.

However, one sector has remained relatively shielded from digital disruption - our financial system. And this, too, is about to change.

What we know about money and currency is being tested by Bitcoin. The digital asset is designed to mimic the fundamentals that make gold valuable, taking aim at the US Dollar by becoming an upgraded reserve asset.

And then we have the tech railings it was built on, the blockchain, which makes legacy financial systems comparable to the steam engine.

This is no secret to the big banks. They know they’re toast if they don’t adapt.

That’s why names such as Citi, JP Morgan, Goldman Sachs, Blackrock, and Franklin Templeton are testing blockchain use cases that are about to upend the world of finance and investing.

By moving to the blockchain, everything of value in the physical world can take on a digital representation - tokens - that can be transacted in a democratic, transparent, and frictionless manner.

Money managers of assets worth trillions of dollars are moving on-chain, tokenizing their funds, and settling transactions more efficiently.

It’s a transformation of unprecedented scale, and we’re right at the beginning of this wave.

Here’s what you need to know.

The walled gardens of traditional finance

Today’s financial system lacks inclusion, keeping most of the world outside its high walls.

To access the financial markets you would need to set up a brokerage account, which requires sending sensitive private information to the unknown (for ‘KYC’), then hoping you’re approved to join.

If you’re allowed in, you will find that the best-performing assets are in private markets, only accessible to people with a net worth upwards of $1 million - what they call ‘accredited investors.’

For people outside the US and Europe, accessing certain equities and bonds is way more complex, if not impossible.

Adding to the frustration is how slow and expensive the financial system is. Trades must meet a litany of compliance measures, requiring bankers, tax specialists and lawyers - all adding to the time and costs.

This is all about to change.

What email did to the postal service is what Decentralized Finance (or ‘DeFi’) is about to do to the financial system.

DeFi and tokenization: Some theory

DeFi not only introduces efficiencies, but it unlocks capabilities we never imagined possible.

It democratizes investments, makes traditionally illiquid assets tradable, automates compliance, and delivers levels of audibility and transparency we’ve never believed possible.

DeFi is run on a ledger distributed across a network - a ‘blockchain’ - making all transactions publicly verifiable and tamperproof.

Blockchain technology also allows you to “tokenize” assets.

This means we can digitize anything of value - stocks, bonds, real estate, art, music rights, and fine whiskey. They sit on the blockchain as tokens backed by the assets they represent in the real world. Their value can then be fractioned and exchanged.

And then there’s the possibility of layering on smart contracts.

This allows embedding the tokens with rules and guidelines that govern each asset, making trades and ownership transfers significantly more cost-effective and settled almost instantaneously, 24/7.

Now that the theory is out of the way, here’s how it’s applied.

DeFi: Opening a new era in finance

Tokenization has been happening in the world of cryptocurrencies for a number of years, with Gold and the US Dollar dominating the real-world assets currently on-chain.

‘Stablecoins' like USDC and Tether are backed 1-1 by US Dollars.

Then there are coins like PAX Gold (’PAXG’) that hold physical gold in vaults to back the tokens they mint.

These are the earliest examples of creating tokens collateralized by real-world or off-chain assets, making them simple to transact.

This is a new world of finance.

Imagine purchasing a token backed by real estate assets in a country where you have no official presence. Ownership of the token is contingent upon meeting guidelines embedded in its smart contract, which meets all the requirements of the jurisdiction in which the real estate sits. The dividends you receive will arrive in your wallet after all taxes and fees are deducted - ensuring complete compliance.

Such capabilities allow everyday retail investors access to projects that would otherwise be impossible due to red tape and restrictions.

For institutional investors, like hedge funds, it makes it easier to move across asset classes and easily find liquidity - way faster and cheaper than in the current system.

The World Bank is piloting the tokenization of an infrastructure project.

Such fundraisers normally require a minimum investment of $1 million from each private investor, effectively locking out most of the public.

With the blockchain, they can now access capital from more people, and due to lowered costs, they will no longer require such elevated minimum investment sizes.

Adding to the possibilities is the transparency of building on blockchain networks. How the funds will be allocated for procurement and other costs will now be open for everyone.

The days of excessive intermediation by financial institutions are numbered as more assets and funds are tokenized on-chain.

The promise of tokenization is transactions that are faster, cheaper, transparent, and open to a broader pool of investors than ever before.

Real-world asset tokenization is happening right now

There has never been more collaboration between the world of Defi and traditional financial institutions.

It’s a necessary step to overcome hurdles with regulation and adoption.

Most recent developments in this space include strategic mergers, inter-bank settlements over the blockchain, the launch of exchanges for trading asset-backed tokens, and the development of bank-owned private blockchains for settling transactions:

• Citi piloted tokenizing one of their funds. The distribution rules were encoded into the token’s smart contract and transferred to hypothetical clients; it was then used as collateral in an automated lending contract.

• JP Morgan facilitated a collateral transaction between Goldman Sachs and Barclays via their internal decentralized application. They tokenized one of Goldman’s money market funds, then transfered it to Barclays for collateral in a derivatives trade between the two.

• Franklin Templeton and WisdomTree have debuted funds whose transaction and ownership records are on the blockchain.

• Goldman Sachs’ private and permissioned blockchain launched its first offering, a $100 million greenbond issued by Hong Kong’s government.

• Siemen’s (not a bank, but a large German manufacturer) issued a $60 million bond on the Polygon blockchain because of its speed and cost efficiency

There have also been strategic mergers amongst blockchain-native (DeFi) providers to consolidate functionality and deliver a more streamlined tokenization service.

Investing in real-world asset tokenization

There’s a long way to go before we see this space mature.

There are regulatory hurdles to overcome and, of course, the market cycle tops and crashes which will be felt especially hard as investors over-estimate the timelines and potential of new innovations like this one.

As always, diligence and research is key before making any investment decision.

These opportunities are easy-to-access for any investor wanting some exposure to this theme -

Polygon (’MATIC’) has been the blockchain of choice for Siemen’s and Franklin Templeton. Avalanche (’AVAX’) is a prominent blockchain solution that was used by Citi for their pilot. Maker DAO (’MKR’) is an asset-backed stablecoin that is likely to see inflows as more assets come on-chain. All three are tradable on major centralized exchanges such as Coinbase, Binance, and others.

Smaller, less established projects are:

ONDO Finance - a crypto-native company that recently premiered a tokenized ETF and bond offerings on the Ethereum blockchain.

RealT (real-estate backed tokens), which may see more use of their networks as people adopt crypto tokens backed by commercial and residential spaces.

Did I miss anything? Do you think real-world assets going on-chain will revolutionize how the world invests? Leave me a comment or hit reply if you’re reading this from your inbox - I would love to hear from you!

Disclaimer:

1. The author owns the cryptocurrencies and financial assets mentioned in this article

2. Material on AltMacro.com and the Alt Macro newsletter is not investment advice but is for general information only. You are solely responsible for making your own investment and financial decisions. Owners of Alt Macro, its representatives, its principals, its moderators, and its members, are NOT registered as securities broker-dealers or investment advisors either with the U.S. Securities and Exchange Commission or with any securities regulatory authority.

Take a deep breath, it’s about to get heavy.

We are in the middle of an epidemic that hardly anyone knows about. There’s a silent nemesis picking away our young, one at a time, every 11 minutes.

Suicide is the second leading cause of death for people between 10-14 and 20-34 years in the US.

If that hasn’t blown your mind, get this - mood disorders like depression and bipolar lead to most hospitalizations for people of this age group.

These numbers are for the US, but the stats on mental health are just as shocking in Asia and the rest of the world.

When we can’t find a way to soothe ourselves from the realities of modern living, we turn to opioids, of course. It’s no surprise then that opioid overdose deaths are up 4x since 2010.

So what better way to solve our psychological problems than by turning to…. ahem… other illicit drugs?

Enter the psychedelic renaissance

LSD, MDMA, and magic mushrooms may bring hazy memories of nights you made more bad decisions than you would like to admit.

And, to no surprise to the ancients and shamans who have been using them therapeutically for millennia, they might also hold the key to treating our mental health crisis.

After being under prohibition for half a century, these substances are now backed by billions of dollars in research funding, policy reforms, and clinical trials that are proving they can treat depression, dementia, bipolar disorder, PTSD, addictions, and other silent killers of our generation.

It’s likely the most exciting development in psychopharmacology we’ve seen.

Why all the fuss?

Meds like Prozac, Valium, Xanax, Zoloft, and many others have been used for years to treat conditions that psychedelics are being trialed for, but they are ineffective for just as many people as they help.

Then there are the side effects that come with the package: Weight gain, sexual dysfunction, and sleep disorders, to name a few.

What’s drumming up the most enthusiasm for psychedelic-assisted therapy is that compounds like psilocybin (found in ‘magic mushrooms’) can produce structural changes in the brain.

Rather than simply masking symptomatic moods and behaviors like common medications do, this gets right to the engineering that causes them in the first place.

Psilocybin can rapidly regenerate neural connections that deteriorate and lead to disorders such as depression, dementia, and even Parkinson's.

One scientist compared it to a cast that allows a broken bone to heal into place.

We’re looking at an alternative treatment that works faster and has more durable results without the side effects.

So yeah, this is groundbreaking and can be HUGE for the future of mental illness.

Capital, research & policy

Johnson & Johnson came up with a ketamine spray (it’s non-psychedelic but psychoactive and illicit) for non-treatable depression.

This was back in 2019.

Two years of a boom in the sector followed, attracting over $2.6Bn in capital throughout 2020 and 2021.

The fervor has chilled since. Funding is down a staggering 85% in 2023 from its high two years prior.

This is why I think it’s a great time to pay attention to this space.

Real progress is made during down-cycles after all the hype subsides.

As markets cooled, clinical trials have increased exponentially. Government restrictions have also eased since. In 2023, Australia made it legal to prescribe psilocybin and MDMA to treat depression.

Such watershed moments will make this sector.

The players

For psychedelic-assisted therapy to enter the mainstream, we will need more investment, research, favorable policy, and a shift in public perception.

These four drivers will signal if this market booms or busts.

There’s enough traction on all these fronts to make me optimistic, and maybe, just maybe, I’m feeling the FOMO.

This isn’t a greenfield space. Large players like Pfizer are already in the game. Also, established ETFs can instantaneously expose you to various companies pioneering the research, like the Horizons Psychedelic Stock Index (‘PSYK’).

Other companies leading the charge are Compass Pathways (‘CMPS’), ATAI Life Sciences (ATAI), Psybio Therapeutics (PSYB), Mind Medicine (‘MMED’), and many more.

Many companies are functioning in legal grey zones that require thorough professional research to flush out their risks.

Clinical trials, patent approvals, and government regulations all take time. Also, public perception can swing against experimental and emerging medicines.

If you decide to take the plunge, expect to be invested for the long haul and ready your stomach for the ups and downs.

Did I miss anything? Is psychedelic-assisted therapy the future of mental health treatments or just another fad? Leave me a comment or hit reply if you’re reading this from your inbox - I would love to hear from you!

Disclaimer: Material on AltMacro.com and the Alt Macro newsletter is not investment advice but is for general information only. You are solely responsible for making your own investment and financial decisions. Owners of Alt Macro, its representatives, its principals, its moderators, and its members, are NOT registered as securities broker-dealers or investment advisors either with the U.S. Securities and Exchange Commission or with any securities regulatory authority.

I know, you’re going: “Ugh, not another article about AI - enough already!”

I feel you. My grandma is ranting about it as much as yours is.

AI is riding on the mother of all hype cycles. It’s so hot that the narrative has added an eye-watering $2.4 trillion to the market cap of the biggest tech companies.

I don’t know about you, but I want some of that action.

The typical advice would be to buy some Microsoft or Nvidia stock, and rightly so.

But this is Alt Macro, this is not where you come for anything typical. You have Jim Cramer and CNBC for that ;)

We want to outperform the markets and spank it out of the park. What better way to do that than by combining two of today’s hottest investment narratives?

Two hot narratives are better than one

AI is the investment theme of our time; ignore it at your peril.

And then we have (almost) every alternative investor’s darling asset: Bitcoin.

Bitcoin has woken up with a roar from its bear market slumber. It has gone from $16,600 at the start of 2023 to $43,000 at the time of writing this just a year later. This rise has come just in time for a critical milestone that all Bitcoin investors wait for - the halving event.

This is when the amount of new Bitcoin released into the network drops by 50% every four years, putting a strain on supply and making it deflationary.

The halving event has always kicked off massive Bitcoin bull runs, and we are scheduled to have our next one in April this year.

When Bitcoin flies, so does the rest of the crypto market. Bitcoin investors take their profits and plow them into other blockchain projects, sparking price rises of cryptocurrencies across the board.

With the price of Blockchain projects set to rise due to Bitcoin’s halving and the investment narrative of all things AI, can there be a better opportunity in 2024 than one that combines BOTH themes at once?

AI and the Blockchain

A good investment theme is always grounded on solid fundamentals. It showcases a scalable and efficient solution to a real problem and is backed by a dream team of experts.

Blockchain’s promise is decentralization. It can save us from AI’s most significant risk: limitless power in the hands of a few.

We live in a world where just seven companies own almost all of the internet - Meta, Alphabet, Amazon, Alibaba, Apple, Microsoft, and Tencent. They have the capital and data to spearhead the creation of AI. This puts way too much control in the hands of people who have betrayed our trust over and over again.

If we create an AI that works for everyone and is not controlled by a few, we will have to build it based on three core principles:

1. Use a distributed protocol so there’s no central ownership - like what the blockchain offers

2. Developers should be able to submit their algorithms to this network and get compensated for their work

3. These intelligent systems must be able to interact and transact with each other

No, I’m not channeling this from a highly advanced techno-utopia millions of years ahead of us. I’m describing what the team at SingularityNET is building.

More effective AI for everyone

SingularityNET (‘AGIX’) is building an ecosystem that meets the three core principles for equitable AI.

Today’s AI tools are highly fragmented, developed in silos that don’t talk to one another.

SingularityNET is developing the capability of plugging together these algorithms so the intelligent systems can collectively produce a value greater than the sum of their parts.

For example, an algorithm that can convert text to speech can have much more value when connected to another that can translate between two languages. One could type out a note and have it read out in real time in any language.

We will need such an interconnected platform for AI to one day perform intellectual tasks at the same or better level than any human, also called “Artificial General Intelligence” (AGI) - the holy grail of this field.

The cherry on top is the potential to turn AI from a corporate asset controlled by a handful of powerful companies to a force for the common good.

Assessing the merits of SingularityNET

SingularityNET aims to become both a marketplace and a transactional network for AI.

Putting AI on the blockchain is a nascent concept. SingularityNET is, therefore, “incubating” several independently-run projects that will one day make up its early ecosystem. How they perform with this is crucial; it will be their ‘make or break’.

There’s significant risk with this approach.

Early-stage ventures have a high mortality rate, and their incubator will have to have a “portfolio approach,” expecting just a small number to make it for the long haul.

The success of this community-building will determine the early adoption and use of their network and native ‘AGIX’ token - the asset any investor in this project will hold.

At the time of writing this, their marketplace has 84 services on offer, with an average of 1-2 reviews each.

This is a sign of some progress in attracting developers; however, there’s very little commercial activity to show.

It is unclear what the marketing team is doing to attract more users or whether they’re in a position to scale further.

Despite their apparent challenges, SingularityNET has been building its platform since 2017 and has attracted a vibrant community, thanks partly to its dynamic founder, Dr. Ben Goertzel.

Goertzel is an OG in this space.

He was amongst the first to use the term “Artificial General Intelligence” (AGI), and he’s been discussing ethics and the emergence of AI for years. He has pioneered the field with 25+ scientific books and ~150 technical papers.

Alongside him is a cofounder and team highly proficient in AI and crypto, making up a solid technical team.

This strength has also skewed their talent mix towards being more technical. The group appears short on marketing and outreach support from people who have successfully driven product adoption.

Traction is a critical factor in evaluating the potential of an opportunity, and their team is yet to deliver on getting momentum on their platform.

Keeping an eye out for risk

If anyone believes that Artificial Intelligence will drive us into the future, paving the infrastructure for its growth deserves attention.

SingularityNET is doing just that. The team is building toward an equitable and ethical future of the technology, and it is being led by a visionary and veteran who understands AI’s future better than most in the industry.

There are still unanswered questions though.

The team has a long way to go to prove the viability of their product despite kicking off operations in 2017. AI has now hit an inflection point, and whether its adoption translates to the growth of the SingluarityNET network will be tested.

Finally - for anyone interested in investing in SingularityNET (or any other asset for that matter), you must do your own research. Cryptocurrencies are highly volatile assets and should be treated with a cautious approach.

You can purchase SingularityNET’s “AGIX” token on an easy-to-use centralized exchange such as Binance, Kucoin, or OKX.

As the field matures, anyone building the railings for AI’s growth should be on investors’ radars, whether it’s SingularityNET or its alternatives.

Did I miss anything? What do you think about blockchain's role in AI development? Leave me a comment or hit reply if you’re reading this from your inbox - I would love to hear from you!

Disclaimer:

1. The author is not invested in SingularityNET or its native token ‘AGIX’

2. Material on AltMacro.com and the Alt Macro newsletter is not investment advice, but is for general information only. You are solely responsible for making your own investment and financial decisions. Owners of Alt Macro, its representatives, its principals, its moderators, and its members, are NOT registered as securities broker-dealers or investment advisors either with the U.S. Securities and Exchange Commission or with any securities regulatory authority.

Hey there, Modern Human.

You likely don’t realize this, but a big portion of your life is being presented to you courtesy of a small cabal of corporations.

You’re likely reading this from a device operated by Google (Android), Apple (iPhone and Mac laptops), or Microsoft (operating systems).

Facebook (or ‘Meta’) will be your go-to for connecting to your loved ones and colleagues through Whatsapp, Messenger, or Instagram.

Any website you frequent (including this article on Substack) will likely be on a cloud service hosted by Amazon - just like your favorite entertainment on Netflix, Hulu, and Spotify.

Try to boycott these five companies at once, and you will be holding a Nokia feature phone, sending SMSs in complete silence, isolated from all the stream of information and your usual online activities.

I’ll stop momentarily to apologize for how this sounds depressingly Black Mirror-esque, but there’s a silver lining to all of this.

A lesson from history

This isn’t new.

We previously lived in a system dominated by a small clutch of corporations that ran everything (the only difference being that they weren’t as tapped into our data and activities, but that’s for another story at another time).

Like today’s big five tech giants, we lived in a world dominated by Blockbuster, Borders, Kodak, Nokia, and others that are no longer.

In their heyday, a world without them would have been unimaginable. Regardless, these giants of the past were disrupted and made irrelevant, and from this, we can learn that innovation is cyclical.

You have a period of growth and innovation that peaks, hits maturity, and then a new status quo emerges based on improved systems and technologies.

It’s exciting being a part of these periods of transformation. They’re highly productive in creating a whole new dimension of reality but also just as destructive. Like in nature, what is old and irrelevant - the deadwood - is cleared out to make way for a new establishment.

Investors have a TON to gain by staying ahead of these curves.

For anyone who analyzed the business models of these incumbents with a technological lens, it would have been a no-brainer to short their stocks and reap outlandish profits.

History teaches us to train ourselves to predict the next incumbents to fall.

Similarly, it’s difficult to imagine Apple, Google, Meta, Netflix, Microsoft, or Amazon becoming dinosaurs and getting blown out of the market by scrappy young technologies.

Their proprietary and vast datasets maintain their hegemony, and their deep cash reserves allow them to buy out anything that threatens their existence.

There’s no questioning their dominance, but by simply looking at the past, we can’t ignore that what feels like impossible always happens.

The innovation wrecking ball

Our current digital age was borne out of drastic shakeouts:

• Apple kicked off the smartphone era with the iPhone, knocking out players like Nokia and Blackberry

• Amazon put retailers like Radioshack, Sears, and others out of business

• Meta disrupted traditional media and communication services

• Google dominated access to media, news, and information

• Netflix made streaming the primary method of accessing video content

Will these giants drive the next wave of innovation, or will they become roadkill like incumbents of the past?

It’s still too early to tell, but we can watch for signs.

These trends could shape the new era (dubbed “Web 3.0”):

• Blockchain technology allows individuals to own and benefit from the networks or communities they grow through their participation. The trend of decentralization and network-owned protocols allows users to own and profit from their data sold to third parties. Imagine a decentralized YouTube where content creators own their audiences and market their presence to advertisers directly - no intermediaries like Google (owners of YouTube) are required. The meager revenue share of the current system would become a thing of the past. The same applies to all other social media networks run by Facebook and others.

• AI removes the necessity to search for and surf from one website to the next. ChatGPT and other generative AI have disrupted how we interact with the internet. Companies like Google rely on search and navigation across websites for advertising revenues, putting their primary cash cow at risk. This also jeopardizes Apple’s earnings from its app store. In a world where AI does the work of multiple apps, users will no longer need to purchase from their marketplace.

• The Metaverse and immersive experiential technologies (AR and VR) can reshape how we shop, consume content, socialize, and transact. How the incumbents adapt to this technology will determine if they can sustain their dominance.

If history is anything to go by, one of the best ways of profiting is by foreseeing tomorrow’s economic systems and picking out today’s giants that will fall with the loudest thud.

Follow their revenue and analyze how they’re adapting to the changes ahead.

Did I miss anything? Which companies would you bet against making it in this next wave of the digital era? Leave me a comment or hit reply if you’re reading this from your inbox - I would love to hear from you!

Disclaimer: Material on AltMacro.com and the Alt Macro newsletter is not investment advice, but is for general information only. You are solely responsible for making your own investment and financial decisions. Owners of Alt Macro, its representatives, its principals, its moderators, and its members, are NOT registered as securities broker-dealers or investment advisors either with the U.S. Securities and Exchange Commission or with any securities regulatory authority.

Folks, nothing is sweeter than making a buck while contributing to the greater good.

The narrative right now is about getting the planet into a state of carbon neutrality. At the same time, we need to improve energy access for more humans and continue economic growth.

This is the perfect storm brewing.

As the planet races towards decarbonization, emerging markets - mainly Asian economies of China and India - are on-ramping more people and industries to a power grid fueled by coal and fossil fuels.

It’s placing a bright spotlight on these two carbon-heavy energy sources.

Our conundrum is that we need development and improvement in people’s lives, but this time with efficient and clean energy.

We’ve made strides in harnessing the sun, wind, geothermal activity, and other natural sources for our energy needs.

Yet, there’s one standout resource whose potential remains untapped: Uranium and its use in producing nuclear energy.

Nuclear energy has a bad rep.

It brings back memories of the disasters at Chernobyl and Fukushima, but take a closer look, and you will find a source of energy that is cleaner, safer, and more efficient than any of the alternatives currently in use.

As mainstream dialog around it slowly turns positive, now could be the time to explore the investment potential of uranium, the commodity and chemical element that fuels nuclear power plants.

Nuclear’s notoriety

Let’s address the elephant in the room: Chernobyl and Fukushima.

There’s no denying the magnitude of these tragic events.

What’s also true is that when you look at the numbers, fossil fuels kill millions annually, dwarfing the death toll of all nuclear disasters combined.

Here’s some insight from OurWorldinData:

”Nuclear energy results in 99.9% fewer deaths than brown coal; 99.8% fewer than coal; 99.7% fewer than oil; and 97.6% fewer than gas. Wind and solar are just as safe.”

We can’t imagine nuclear energy without envisioning toxic sludge, radioactive frankenfish, and Homer Simpson’s disaster waiting to happen.

Today's improved “dry casks” for storing spent radioactive waste can withstand substantial impacts, earthquakes, tornadoes, etc. There have been no accidents (or deaths) with these storage mechanisms.

It’s important to note that all forms of electricity produce waste - carbon released into the atmosphere. Nuclear energy’s residuals are effectively “bottled up” and stored away without coming into contact with the environment.

Expensive to build, cheap to run

Building a nuclear power plant is expensive and very complex.

Most upfront capital costs arise from the thousands of laborers required, materials (primarily steel and concrete), and the components and systems needed for the plant's cooling, ventilation, and other controls.

The economics of operating the plant, in relation to the amount of energy produced, make nuclear energy a very attractive solution - especially in comparison to the ongoing costs of coal and gas-firing plants. The fuel, operations, and maintenance (including managing spent uranium) are relatively low, making this an economically attractive energy source.

Momentum in the markets

Uranium, the critical resource for producing nuclear energy, is showing signs of emerging from a 10-year bear market. The price has risen nearly 50% since the beginning of 2023. Demand for it, driven by its increased use in nuclear reactors, is expected to rise 28% by 2030.

This is where the uranium is going:

• China has earmarked $440 billion to build 150 reactors by 2035. For context, there are 440 reactors currently operational worldwide.

• Europe included nuclear energy as part of its sustainable investment taxonomy, prioritizing its role in the continent’s future

• Japan will be reopening its nuclear reactors after seeing rising energy prices since the Fukushima incident

• India plans to more than triple its nuclear energy production, fulfilling 9% of their power consumption by 2047

Lastly, geopolitical factors have become influential on the price of uranium. The US, Russia, and China tug-of-war alongside localized risks in uranium-producing countries like Niger will contribute to supply stressors.

Potential headwinds

There is still a lot to overcome in terms of public perception and regulatory hurdles for nuclear to play a substantial role in the planet’s energy mix.

Other pressures include the advancements in using alternative energies that could prove more cost-effective, like the global race to mine Helium-3 from the moon’s surface to produce nuclear energy.

Regardless, it’s hard to see a world that doesn’t significantly increase its nuclear energy capacity, driving up demand for uranium as a critical energy source to fuel the planet’s new phase of carbon-friendly growth.

How to invest

Investors can participate in this energy trend by buying into mining companies, physical uranium or nuclear energy producers. The most straightforward approach for U.S. investors would be to participate in any of these ETFs exposed to uranium:

• Global X uranium ETF (URA)

• Sprott Uranium Miners ETF (URNM)

• VanEck Uranium+Nucleur Energy ETF (NLR)

Did I miss something? What’s your take on nuclear energy? Do you plan on making uranium a part of your investment portfolio? Leave me a comment or hit reply if you’re reading this from your inbox - I would love to hear from you!

Disclaimer: All material on the Alt Macro web/server and newsletter is not investment advice, but is for general information only. You are solely responsible for making your own investment and financial decisions. Owners of this newsletter, its representatives, its principals, its moderators, and its members, are NOT registered as securities broker-dealers or investment advisors either with the U.S. Securities and Exchange Commission or with any securities regulatory authority.

Spot Bitcoin ETFs got approved for the first time in the US, not just one but close to a dozen. Bitcoiners worldwide are giddy because it means tens of billions of dollars have begun chasing the asset, starting now. Everyone who held firm and HODL’d through the bear market deserves a pat and high five.

But this is Alt Macro. We’re here to learn about what’s next, not what’s happening.

Today, we’ll be answering two questions:

What does the approval of Bitcoin ETFs mean for the future of Bitcoin? Then, more importantly - what is the next big opportunity that follows?

Let’s start with the first.

Investing in Bitcoin meant learning a new platform (like Coinbase or Binance) and understanding the difference between hot and cold wallets. Taking custody of the coins required learning the technicalities of securing your private keys. Millions of dollars of Bitcoin have been forever lost because of these hurdles.

ETFs remove almost all this friction of buying and holding the asset.

Now, buying Bitcoin is as easy as purchasing a stock or mutual fund, opening it up to waves of buyers.

Unlike futures ETFs which are based on contracts, spot ETFs will require funds to buy and hold the underlying asset.

This additional demand for a highly scarce asset like Bitcoin could cause a supply shock and drastic upward price movements.

For some context, Blackrock - who launched one of the eleven ETFs, and is the world’s largest asset manager - gobbled up 11,500 BTC just two days after launch. At the current rate, 900 Bitcoin are issued daily, so that’s 13 days of supply taken off the market by just one player.

Add in demand from other ETFs globally, retail investors, sovereign funds, and other institutions, and there’s not enough Bitcoin to go around.

This shortage will be more pronounced by April this year when the famous halving event happens: the programmed reduction in Bitcoin’s supply by 50% that occurs every four years.

These are a few reasons why it’s an exciting time for anyone holding Bitcoin.

Beyond the supply crunch, the more significant impact of the SEC’s approval will be the regulatory framework that legitimizes the asset class.

It will give institutions and sovereign wealth funds the security they need to allocate a portion of their funds to Bitcoin.

A large, forward-thinking sovereign fund - like one belonging to the Saudis, Emiratis, or Qataris - allocating just half to one percent of their reserves to Bitcoin would be a game-changer for the space.

The ETF approvals will shape the future of Bitcoin by causing a supply shock and triggering the next big narrative for the asset:

“Which is the first major sovereign wealth fund to allocate a portion of their portfolio to Bitcoin?”

If this isn’t a big enough development to pay attention to, I don’t know what is.

Now, looking at the next question - what is the next big opportunity that follows?

To answer this, we had some telltale signs leading up to the SEC’s decision.

By now, most of you know that nothing happens in Bitcoinlandia without some spicy controversy. The lead-up to the January 10th approval served up its fair bit of drama.

In an apparent breach, the SEC’s X account (formerly Twitter) tweeted that the approval was confirmed a day before the deadline for a decision. The announcement on X before the SEC’s website felt off, and many people questioned its legitimacy.

It didn’t take long for the tweet to be taken down, and SEC chairman Gary Gensler put out his message saying that no such approvals were made.

Naturally, the price of Bitcoin whipsawed along with the rest of the crypto market. But what stood out was the price of Ethereum - the second largest cryptocurrency in market cap, following Bitcoin.

With the fake approval, the price of Bitcoin held steady, as Ethereum’s skyrocketed.

Nobody saw this coming.

Some said that Mr. Market showed his hand, and they were right.

This was identical to the price movement when the official approval by the SEC came out the following day.

The price of Bitcoin pumped by a little over 2%, but nothing like Ethereum’s 5.6% surge.

So, what’s the takeaway from this?

The big winner from the Bitcoin ETF will likely be the rest of the crypto market.

The knock-on narrative will be: “What’s the next crypto ETF to be approved?”

There are arguments that Solana and XRP could be the following cryptocurrencies to get their ETFs, but in a highly volatile and nascent space, the SEC will likely err towards the more “bluechip” coins.

Also, to get approval, any asset must be classified as a commodity and not a security. Besides Bitcoin, only Ethereum seems to pass this test, according to the SEC.

It’s not just me that thinks so. Blackrock has filed for an Ethereum ETF, amongst a host of other funds. SEC decisions are due for their applications from May through August this year.

Blackrock never loses. Would you bet against them?

Before investing in Bitcoin, Ethereum or any cryptocurrency, you must educate yourself on the network and its potential. If you don’t know what you’re getting into, the volatility will freak you into selling when the price is low. The time you take to build your knowledge could be the X factor your portfolio needs.

What do you think about the narrative of sovereign funds driving the next leg of demand for Bitcoin? Do you expect the approval of a spot Ethereum ETF? Leave me a comment or hit reply if you’re reading this from your inbox - I would love to hear from you!

Disclaimers:

1. The author owns the digital assets or cryptocurrencies mentioned in this article.

2. All material on the Alt Macro web/server and newsletter is not investment advice, but is for general information only. You are solely responsible for making your own investment and financial decisions. Owners of this newsletter, its representatives, its principals, its moderators, and its members, are NOT registered as securities broker-dealers or investment advisors either with the U.S. Securities and Exchange Commission or with any securities regulatory authority.

Get ready, changes ahead!

Our social, political, economic, and technological landscapes are shifting.

Changes have never come as fast or as dramatically as what we are witnessing right now.

Staying ahead of the transformations and adapting with equal speed will be critical to come out on top. This article will give you a framework to do just that. I summarize the influences that will sway the economic landscape in the years ahead.

But before we get into it, there’s something you should know.

A lesson on predicting the future

I have learned an important lesson in my fifteen years of building businesses and making investments.

What’s more important (and challenging) than predicting the future is timing it.

Projecting the horizon for a trend to reach its full potential requires deep analysis and constant monitoring of the markets.

Many factors hinder or accelerate the adoption of a new idea; your projection of when the time will come for a trend to achieve mainstream adoption will determine your success levels.

Every innovation has its unique adoption and growth curve. Every market has its nuances. Taking the time to understand these intricacies is the diligence required to be a successful investor.

DYOR - “do your own research” - will always be the mantra.

With that said, let’s get into it.

Here are some trends I’ve forecasted in the past.

10+ years of reading the markets

I’ve put either my time or money into the following high-level market theses:

1. Consumers will demand eco-friendly and socially responsible fashion that delivers equally high standards of design and quality (2010)

2. Brick-and-mortar retail will rapidly collapse and make way for online commerce (2012)

3. Electric vehicles that equal or surpass the performance of mainstream gas-powered ones will dominate the automobile sector (2013)

4. 3-D printing will revolutionize industry (2013)

5. Policy and cultural acceptance of cannabis will spawn a multi-billion dollar sector (2015)

6. Digital technologies that solve fundamental human challenges will thrive in developing regions with the fastest-growing populations, such as in Africa (2016)

7. Bitcoin and Ethereum will be the fundamental building blocks of a new world economy (2016)

Some of these have turned out accurate, while others are still maturing and are yet to achieve critical levels of adoption. Here’s an update on them -

• My business in the eco-fashion space faltered, primarily due to operational and strategic reasons rather than a misdiagnosis of the future market. The dialog around transparency in apparel supply chains has reached mainstream levels.

• Going all in with my time on a software startup that helped bring retailers online saw exponential growth in revenue and demand.

• My early investment in Tesla (~$180/share) and the overall sector of automobile electrification has outperformed my projections

• The 3-D printing sector has grown but hasn’t reached the heights I expected 10 years ago. My bets on this sector's most significant public companies (such as SSYS and DDD) took a while to turn profitable, and I could have allocated that capital elsewhere.

• Cannabis as a viable growth sector took 5 years longer than I expected it to hit mainstream adoption and continues to lag behind other innovations. Again, my capital would have performed better in other sectors.

• Startups in East Africa, primarily using tech solutions to solve logistics challenges of essential goods, have had a mixed performance. I was fortunate with the portfolio of companies I invested in and remain bullish on their prospects while expecting a longer time horizon to see returns.

• The adoption of Bitcoin and decentralized finance requires a high amount of regulatory scrutiny and has taken longer than expected to hit mainstream adoption; however, this sector has delivered more profits than any other asset class and I consider this to be amongst the best calls I’ve made.

Going forward, the world will be way more complex than we have today or can envision.

Instead of a simplistic list of theses or predictions, we need a framework through which we see the world.

A new economic order

In the future, when we look back at the world we live in today, the homogeneity and uniformity of the current system will stand out. We will gradually transition into a bipolar (or ‘multipolar’) world with a more distributed balance of (economic) power, adoption and integration of diverse lifestyles, and hyper-digitization at unforeseeable levels.

1. The splintering of the global system will lead to the adoption of emerging currencies, migration, and spawn industries catering to alternative lifestyles.

   • A world economy and geopolitical landscape led by a Western-led coalition and backed by the US Dollar will be balanced by a bloc of emerging economies (BRICS) that trade using alternative currencies.

   • Social and demographical shifts will spawn multiple special-interest communities based on diverse lifestyle choices, impacting how people are educated, where they work and live, and their consumption choices.

2. Artificial Intelligence (AI) will spearhead the future.

   • AI and robotics will alleviate some pains from labor shortages arising from aging populations in developed countries.

   • Today and in the past, acquiring technical skills was the route to ensuring gainful employment and a secure future. AI will soon render degrees in STEM subjects (science, technology, engineering, and mathematics) useless while unleashing a renaissance in arts and creativity.

   • The rise of the “solopreneur” is here. With AI taking on the function of expensive technical talent, people can now direct and curate their visions, democratizing entrepreneurship and shaking up the traditional startup model.

   • Services facilitating interactions with other humans will gain traction as more people seek a more authentic, “non-artificial” experience.

3. Key technological trends will accelerate social and political forces at work while leading the next wave of hyper-digitization.

   • The current economy, based on transacting goods and services in the “physical” space, will make way for a parallel virtual economy, creating the next wave of hyper-growth and wealth creation.

   • The current breed of tech corporations with highly centralized power structures and data ownership will be tested by consumers who demand a more democratic distribution of benefits from the networks they help build.

   • A second and parallel web will be built on the fundamentals of censorship resistance and distributed network ownership.

   • Ballooning national debt, tightening monetary policy, and governments willing to exercise draconian laws aided by new technologies will make privacy and self-custody of monetary value essential.

These are not predictions on specific industries or technologies. Instead, consider this a narrative of where the world is today and where it can go in the future.

Some trends will take longer to mature, while others may take an unpredictable turn.

Choose the wave you want to ride and share your journey with me. Did I miss anything? See you in the comments!

Disclaimer: All material on our web/server and newsletter is not investment advice, but is for general information only. You are solely responsible for making your own investment and financial decisions. Owners of this newsletter, its representatives, its principals, its moderators, and its members, are NOT registered as securities broker-dealers or investment advisors either with the U.S. Securities and Exchange Commission or with any securities regulatory authority.