This week we are going to talk about one of the most polarizing and emotional topics of the last few years…cryptocurrency. Specifically, we will focus on Bitcoin but it is important to understand that there are now about 3,000 different cryptocurrencies that are being traded. This topic is so complex and sensitive that my plan was to put it off till later but this week had some of the richest people in the world arguing about cryptocurrency and whether it should be part of our portfolio. All this was happening while the market lost $3.6 Trillion dollars of value. It was a hell of a week!

There are so many potential starting points to dive into the crypto world but let’s start with a really fundamental imperative of investing: you have to do your homework. That applies to buying a stock, bitcoin or pretty much any material investment you are making. If you are going to buy the stock of an individual company, you should do some research on what they do, how their business is going and the future prospects of the company which will hopefully lead the stock price to go up. This process applies to cryptocurrencies as well.

Ok, so let’s start by defining what cryptocurrency is…it is an internet-based medium of exchange which uses cryptographical functions to conduct financial transactions. Cryptocurrencies leverage blockchain technology to gain decentralization, transparency, and immutability. The most important feature of a cryptocurrency is that it is not controlled by any central authority: the decentralized nature of the blockchain makes cryptocurrencies theoretically immune to the old ways of government control and interference. Cryptocurrencies can be sent directly between two parties via the use of private and public keys.  These transfers can be done with minimal processing fees, allowing users to avoid the steep fees charged by traditional financial institutions.

Bitcoin was the first cryptocurrency created in 2008 by an unknown person named Satoshi Nakamoto. In fact, you can read the white paper that outlines the creation of a peer-to-peer network for electronic cash, defining the steps to run the network, establishes the incentives (the actual coins for mining and maintaining the network to send transactions) and all the math behind the cryptography and the creation of the limited supply of 21 million coins that will ever be issued into circulation. It is brilliant on a number of levels. As a pure technology, blockchain is and will continue to change how business is done. As an economic framework for decentralized, non-state dependent money, it is an innovation in economics.

Let's hear from Warren Buffet, Tim Draper and Chamath Palihapitiya on their Bitcoin thoughts...

So where does that leave us? Really smart, well-connected people disagree on the value and future of this asset. You have to decide for yourself what you think after reading and assessing. On our website…www.calm.cash, I will post some articles and videos in a bitcoin blog that can help you make your own assessment if cryptocurrency makes sense for you and your portfolio.

My personal opinion after researching blockchain technology and assessing if bitcoin can be a store of value is that there could be some real upside here. Just like I own stocks, mutual funds and other assets like real estate in the form of my house, I think bitcoin and certain cryptocurrencies are nice long-term investments and a type of asset that I want to have some exposure to in my holdings.

This won’t be the last time we visit cryptocurrency. Until then, I encourage you to do your homework and think critically about if bitcoin or crypto is a good investment for you and your family. Just be careful about all the emotion potholes exist on this journey.

Whatever your feelings, I hope you find a happier life and healthier wallet.