The Crypto Market Is Testing Our Patience Today

Is the great crypto bull market over?... The crypto market is testing our patience today... The two parts of every real booming innovation... The 'fundamental boom' is upon us... Green energy, the Internet, and bitcoin... Looking at the recent volatility in cryptos... How to take the next step in the crypto revolution...

Editor's note: We know you're worried about what's happening with cryptos...

Bitcoin, the world's most popular cryptocurrency, went on an incredible run from last fall through this spring. It surged more than 500% – from about $10,000 in October 2020 to its peak of about $65,000 in April.

And it wasn't just bitcoin... Ethereum, the second-largest crypto, climbed from about $400 last October to around $4,500 in early May. That's a gain of roughly 1,000% in around half of a year. The entire crypto universe soared, too... The total combined value of the coins and tokens that CoinMarketCap.com tracks reached as high as $2.5 trillion on May 11.

If you followed the work of our colleague and Crypto Capital editor Eric Wade, you reaped the rewards. He helped subscribers book a series of remarkable, high-triple-digit gains over that span – including 638% on Quant, 963% on Binance Coin, and 978% on Frontier.

But then, starting in mid-May, the bottom dropped out of the crypto market...

In June, bitcoin's value fell to less than $30,000 for the first time since January. And as we go to press, it's trading at around $29,800 – a 54% drop from its April peak. Ethereum is down even more from its peak... It's around $1,800, roughly 60% below its all-time high.

According to CoinMarketCap.com, the crypto universe has a combined value of about $1.2 trillion right now. That's less than half of what it was valued at just two months ago.

So naturally, we've received a ton of feedback asking essentially the same question...

Is the great crypto bull market over?

While no one can accurately predict what the future holds all the time, we're here to tell you today that Eric, our resident crypto expert, remains as bullish as ever on the space. In fact, he's so confident about the crypto revolution that he's taking the next step right now...

Tomorrow night, July 21, at 8 p.m. Eastern time, Eric will host an urgent crypto summit for all Stansberry Research readers. During this event, he'll reveal exactly how you can take advantage of the most important disruption in the history of the crypto world...

Eric is talking about making money on your money... in a brand-new way. You'll discover how to generate yields of 10%... 20%... even 35% on your crypto holdings. But not only that, you'll also be able to still capture the massive upside of cryptos in your portfolio.

In short... if you own bitcoin, Ethereum, or other cryptos – or even if you don't yet – you can't afford to miss Eric's event tomorrow night. Save your spot right here.

With that in mind, we're turning today's Digest over to Eric to explain why cryptos are far from dead right now. As he'll explain, this is all just part of a pattern that anyone can see...

The crypto market is testing our patience right now...

Earlier this year, it felt like we could do no wrong in this little-known corner of the investing universe... Bitcoin, Ethereum, and countless other cryptos soared to record-high values.

Unfortunately, as any Digest reader knows, nothing goes in a straight line up forever...

If that were the case, investors wouldn't need to do any research. Everyone would just put their money into the "straight line up" investment and live happily ever after.

But if you've invested in cryptos so far this year, you know that's far from the case...

Bitcoin is down about 54% from its April peak of roughly $65,000. And after peaking a few weeks after bitcoin, Ethereum is down 60% over a similar span through today. Even worse, the entire crypto universe has been roughly cut in half over the past two months.

After the recent correction, a lot of folks are wondering if we're on our way to another big 80% or 90% crash – like the one we saw in 2017...

But I (Eric Wade) believe we're in a totally different place today. And in today's Digest, it's important for me to detail exactly why we'll soon head for much brighter days again...

As we see again and again, every real booming innovation has two parts...

The first phase is what I call a "speculative frenzy."

This is when an innovation catches the hearts and minds of a lot of people. And it drives prices sky high... regardless of the fundamentals of the underlying business or technology.

This phase is largely driven by the fear of missing out. But eventually, prices crash.

However, when you have a real innovation, they come roaring back in a big way...

This time, the boom is based on real revenue and earnings. It reignites excitement for the technology and attracts another wave of investment.

Most important, the "fundamental boom" typically leads to huge, multidecade trends as new technologies take hold, real businesses get built, and fortunes get made.

That's what we have in crypto today.

It's a pattern that anyone can see...

For example, the green-energy boom in 2006 and 2007 happened too early. Solar and wind power were nowhere near mass adoption. But a speculative frenzy caught hold... The S&P Global Clean Energy Index tripled before collapsing.

Compare that with the situation in the same part of the market today...

Renewable energy is booming again. But it isn't going up based on pure speculation this time...

Renewable energy is now cost-effective. It's becoming a huge part of our energy production. That has caused the index to triple off its bottom again. Take a look...

Or think of the Internet...

In the late 1990s, people thought the Internet was the future. So they bid up any stock with "dot com" in its name to ridiculous levels. You know how this story ends... Most investors lost money on the "speculative frenzy" in 1999 and 2000.

But all that money didn't disappear when the market crashed... Internet companies used that capital to create real businesses with earnings and disruptive business models.

That led to the "fundamental boom" that has driven technology stocks higher and higher for the past 20 years. Take a look...

The same pattern is true for cryptocurrencies...

In 2017, investors drove bitcoin from essentially $0 to $20,000 before prices collapsed. But they weren't wrong about the potential for the technology... They were just early.

Now, fast-forward four years later...

The "speculative frenzy" of 2017 brought bitcoin to $20,000... but the "fundamental boom" of 2020 and 2021 brought it to $60,000. Take a look...

The bitcoin frenzy in 2017 helped attract capital to develop the infrastructure for cryptocurrency. Now, that's allowing the industry to disrupt massive established businesses.

Of course, at this point, I know you're wondering how the recent pullback fits in...

If the booming price of bitcoin is based on true fundamentals... why has the price of cryptos pulled back?

Well, if you believe in the disruptive technology that cryptos represent and you believe in the long-term implications of this technology, volatility is something you just need to get used to.

And the volatility we're seeing today isn't out of the ordinary...

As many folks have pointed out recently, before bitcoin reached its first big peak at $20,000 in December 2017, it underwent six separate corrections of 30% to 40% along the way. You can see it in the chart below...

This time is no different in that regard...

Back in January, as bitcoin was still surging, it pulled back about 25% – from around $40,000 to roughly $30,000. A month later, it dropped more than 20% in a week. Then, after peaking in April, it plunged another 25% in two weeks before recovering slightly.

My point is... the pullback we've seen recently is par for the course.

When an asset is doubling its adoption rate or more per year – like bitcoin has since it was created – you have to expect volatility. But it doesn't mean that prices can't go a lot higher from here.

And that brings me to why I'm as bullish as ever on cryptos today...

When I look at cryptocurrencies and blockchain, I see an unstoppable technology that's going to change the world. It's why I continue to believe our patience will pay off...

Even as bitcoin falls to less than $30,000, I'm not worried. Just like nothing goes in a straight line up forever, unstoppable technologies can't be kept down forever.

We'll likely look back in a few years and see the buying opportunity we have right now...

I've gone on record many times with my thoughts that bitcoin will reach $1 million in our lifetimes. I still believe that today... so it's a great bargain at around $30,000 right now.

Not only that, but I also believe cryptos can help you 'opt out' of the traditional financial world...

Investors everywhere are facing a terrible dilemma right now. Stocks are the most expensive they've ever been... Bonds are offering negative real yields... And thanks to the recent boom in housing prices, real estate is suddenly out of reach for most investors.

So if you're looking to collect income on your money... what exactly can you do?

This is why I'm holding a special event tomorrow night, July 21... I'm planning to show everyone who attends precisely how they can generate huge income streams with cryptos.

To be clear, it's not going to be something as basic as "buy bitcoin"... "buy Ethereum"... or "buy any other crypto" available in the world today. This opportunity is much bigger.

Bitcoin was the first step in the crypto revolution. Now, it's time to take the next step...

During my event, you'll see how you can turn your hard-earned dollars into annual income yields up to 35%. And you'll still be able to catch the massive upside in cryptos from here.

I've said enough in today's Digest. I hope you'll clear your schedule to join me tomorrow night. The event will start promptly at 8 p.m. Eastern time. Reserve your spot right here.

Our Biggest Event of the Year Is Back... And In Person

You're invited to join us this October for our 19th annual Stansberry Research Conference... And even better, we're back in person in Las Vegas this year!

Regular Digest readers know our conference is a gathering of some of the best folks in financial research. You'll hear from financial heavy-hitters and inspirational speakers, mingle with like-minded folks, and get investment ideas you can act on in real time...

For example, last year's exclusive conference recommendations are soaring. They're almost all seeing double-digit returns – with gains as high as 195% and 310%.

And as always, we've put together an all-star lineup of guest speakers...

You'll hear from Paul DePodesta, the chief strategy officer for the NFL's Cleveland Browns... Mohamed A. El-Erian, one of the world's most influential economic thinkers... Tony Seba, an angel investor and Silicon Valley entrepreneur... and countless others throughout the event.

This year's conference will be held Monday, October 25, and Tuesday, October 26, at the luxurious Encore at Wynn Las Vegas. Click here for more details and information about how to grab your ticket right now.

New 52-week highs (as of 7/19/21): Costco Wholesale (COST), Dollar General (DG), DocuSign (DOCU), ResMed (RMD), and Stamps.com (STMP).

In today's mailbag, more feedback on Dan Ferris' latest Friday Digest. Do you have a comment or question? As always, send your notes to feedback@stansberryresearch.com.

"Outstanding Dan! I would have never seen the potential had I not read your article. Thanks for another gem!" – Paid-up subscriber Paul E.

Good investing,

Eric Wade
Southern California
July 20, 2021