I can still hear the screeching sound of my old dial-up struggling to connect to the internet.

Remember those days? I’d fight with my brothers and sister for a turn on our one family computer.

Slow websites. Frozen pages. Dropped connections. The early days of the internet were rough.

But if you had the foresight to invest in AOL during those days, you could’ve made good money. AOL went from a few bucks a share in 1997 to nearly $100/share (split-adjusted) by 2000, before merging with Time Warner and dropping during the dot-com bubble.

Source: Seeking Alpha

Of course, that’s not the only example.

Investors who backed new types of companies like Amazon (AMZN), Google (GOOG), and Cisco Systems (CSCO) when the web was in its infancy made life-changing money.

The lesson: It paid to make smart bets on the internet when it was still messy.

I bring this up because crypto is a lot like the early days of the internet.

Not user friendly. Messy. Takes effort to navigate.

According to RiskHedge’s resident crypto expert Stephen McBride, that’s our opportunity.

“All groundbreaking new technologies suck at the beginning.”

Crypto’s come a long way in the last couple years.

There are now 580 million crypto holders worldwide—a number that grew 34% in 2023.

But there’s still a long way to go. Stephen:

Today, the crypto user experience sucks.

There’s no way a billion people will use crypto in its current form. And that’s our opportunity.

Just like the internet, crypto will become much easier to use. This is going to attract hundreds of millions of new users, fueling years of rapid growth for crypto businesses.

By investing now, you can set yourself up to profit from this growth. The vast majority of investors won’t put the effort in. That’s why they’ll only ever read about the big money crypto investors can make.

The frustrating user experience means we’re still very early to crypto.

And keep in mind... crypto is still tiny.

Relative to real estate, the S&P 500, and gold... crypto is barely a blip:

In fact, Microsoft (MSFT)—one company—is larger than the entire crypto market. So is Apple (AAPL). And Nvidia (NVDA) isn’t far behind.

So crypto is new(ish), small, and rapidly improving.

That makes it a great source of potentially asymmetric returns.

In investing, “asymmetric” means the potential upside of an investment is much greater than the potential downside.

Symmetric investing is when an investor risks $500 for a chance to make $500. Or $10,000 for a chance to make $10,000.

Asymmetric investing is risking $500 for the chance to make $10,000.

Of course, booking 1,000%+ gains is easier said than done, and it requires taking greater risk.

That’s why asymmetric investments should be no more than a small part of your overall portfolio. Stephen recommends putting only 1%–2% into crypto, max.

Is bitcoin still an asymmetric opportunity?

Depends on the timeframe.

Bitcoin trades for about $62,000 as I write. Stephen expects it to hit at least $150,000 this cycle. That’s a little more than a double. Symmetric.

Given time, could bitcoin reach $1 million? If its adoption curve continues, absolutely. But it’s highly unlikely to shoot up 10X or more quickly, as small cryptos often do.

Stephen says the #1 asymmetric opportunity today is in the smaller, lesser-known cryptos. The crypto market is still so small and so new, there’s room for exponential growth.

Chris Reilly

Executive Editor, RiskHedge

To get more ideas like this sent straight to your inbox every Monday, Wednesday and Friday, make sure to sign up for The Jolt, a free investment letter focused on profiting from disruption.

Expect smart insights and analysis on the latest breakthrough technologies, the big stories the mainstream media isn't reporting on, and much more... including actionable recommendations.
Click here to sign up.

© 2024 Copyright Chris Reilly- All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Only logged in users are allowed to post comments. Register/ Log in

The Market Oracle is a FREE Financial Markets Forecasting & Analysis web-site.
(c) 2005-2024 MarketOracle.co.uk (Market Oracle Ltd) - Market Oracle Ltd asserts copyright on all articles authored by our editorial team and all comments posted. Any and all information provided within the web-site, is for general information purposes only and Market Oracle Ltd do not warrant the accuracy, timeliness or suitability of any information provided on this site. nor is or shall be deemed to constitute, financial or any other advice or recommendation by us. and are also not meant to be investment advice or solicitation or recommendation to establish market positions. We do not give investment advice and our comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to enter into a market position either stock, option, futures contract, bonds, commodity or any other financial instrument at any time. We recommend that independent professional advice is obtained before you make any investment or trading decisions. By using this site you agree to this sites Terms of Use. From time to time we promote or endorse certain products / services that we believe are worthy of your time and attention. In return for that endorsement and only in the cases where you purchase directly though us may we be compensated by the producers of those products.