Market Monday: Cryptocurrency Boost From Wall Street?

Who: Young “wall streeters” raking in the dough.

What: Prediction that they will use their large bonuses to speculate in cryptocurrency.

When: Bonuses for many hit January 15th.

Why: Young people making a lot of money and ready to speculate.

My Thoughts

This is a fun thought for the day! With the stock market steadily on a historic rise making everyone rich, naturally we are all bored. We are just humans after all seeking instant gratification and entertainment. This is where cryptocurrency comes in, hello volatility.

The cryptocurrency space is a fun space to track regardless of what your take on it is. My thought is that some young “wall streeters” will speculate. What will this mean for Bitcoin prices…absolutely nothing.

Let’s put this into perspective with the top 5 market caps of cryptocurrency currently in circulation below.

Coinmarketcap.com

With Bitcoin sitting at a 259 billion market cap I think that the bonuses on wall street will hardly put a dent in the price movement.

There are tons of people speculating all at once and that is causing the intense volatility. If any of you are looking for a very interesting read check out American Kingpin: Nick Bilton. This has really opened my mind in understanding the original reason cryptocurrency stayed alive, drugs and black markets.

Yep, black market is my gut call on what got this madness going. Now I think main street has gotten a taste of greed and wall street is looking to profit. To each their own in the cryptocurrency mania!

My best guess is that crypto’s will be the first to fold in the sign of any market pressure in the future, so tread lightly young “wall streeters”.

What Are Your Thoughts?
  1. You buying bitcoin with your bonus, don’t be shy?
  2. How is everyone doing that is in the crypto space?
  3. If you were a 24-year-old and received a 100K bonus check would you roll the dice?

Spread The Wealth!

25 Comments on “Market Monday: Cryptocurrency Boost From Wall Street?”

  1. Your timing always seems coincide to when I’m perusing any posts I missed earlier in the day, DM 🙂 . I also read the same article earlier on BI.

    I do read BI and a number of other related sites frequently. Ultimately, what ever one decides to do with his or her bonus is a personal matter. It’s an entertaining read though.

    On your other questions:

    1. You buying bitcoin with your bonus, don’t be shy?
    – No, likely not.

    2. How is everyone doing that is in the crypto space?
    – Still on the fence, but a few colleagues / friends have put a couple hundred bucks in for “fun”.

    3. If you were a 24-year-old and received a 100K bonus check would you roll the dice?
    – Yes, but not all 100K – or rather $50-60k after taxes – I’d review other goals, etc. and decide accordingly.

  2. Blockchain technology is here to stay in one form or another which will be a game changer. Given the returns we have witnessed in some cryptocurrency, it is safe to say that they are definitely a very risky asset! I am sure there is a lot of money to be made with cryptocurrency but I will stick with what I know, slow, boring, dividend stocks and ETFs.

    1. There will be people getting rich in one form or another that is for sure! I will stick with the assets that people will flee to when this bull market reverses.

  3. Morning DM! Even as a tech guy who probably should be curious about crypto, I just can’t get excited about it. I probably will have egg on my face for not being an early adopter but so be it. I have no problem with young folks speculating lightly into it but I wouldn’t go too crazy I guess. But that is just my conservative nature.

    At least if a young person loses a bit on crypto, they have a long time to make back the money!

    1. Hey MDS,

      You have to check out that American Kingpin book. It was crazy eye opening to how Bitcoin was useful to the black market. I really think what has followed is 90% speculation. The block chain tech is cool for application but this is pure gambling.

      Pure Speculation in my opinion, doesn’t mean that people wont make money on it though.

  4. I’m chicken $hit… or maybe the topic just doesn’t excite me as much. Idk what it is but I was never really interested in reading about the bitcoin or other crypto currencies the same way everyone else is. I guess I’m just odd like that.

    I hear some ppl banked their life savings for this. IMO that’s just insane 😩

    If I had $100k to play w/ I’d likely shelter as much as I could and invest it in something boring and a little bit of play money invested in a stock I like. For some reason, I view my bonus as the same as any other money I make from regular income. I don’t really bucket that as my “bonus.”

    1. Life savings now that is insane. Many have also gambled their “life savings” in vegas and the stock market as well.

      That “some reason” is called common sense haha. Just because it is a bonus doesn’t mean it has a different value from every other dollar you earn! You are wise and will be rich…

  5. Hey DM,

    I’ve been buying Ethereum for a few months now, plus smaller investments in IOTA and other cryptos. It’s still a small part of my overall portfolio, and I plan to keep it that way. I think Ethereum smart contracts are potentially revolutionary technology.

    On paper, I’m up over 100%.

    If I got a 100k bonus, I’d invest 5-10k in crypto and the rest in index funds.

    I think cryptos may go mainstream at some point, particularly if practical uses increase and it becomes easier to safely hold them.

    Cheers,

    Miguel

    1. Etherum held strong today! Thanks for putting it out there Miguel I respect that!

      I hope it crushes it for you.

  6. You buying bitcoin with your bonus, don’t be shy?

    —-No, I don’t have a bonus 🙁 I’m on mat leave. Does spit up count? Even if I did, I would not.

    How is everyone doing that is in the crypto space?

    —–I have no idea, seems like everyone is doing really well and up $75,000 in one day.

    If you were a 24-year-old and received a 100K bonus check would you roll the dice?

    —–Maybe. That was 10 years ago me… I would probably put in 5K of the 100K bonus into cryptocurrency if I was a young brash 24 year old. Haha.

    1. It’s like they want you to love your new born in Canada…unbelievable get back to work! 🙂

      It sure does seem like “easy money”. If one has any “street knowledge” it is that easy money soon turns sour.

  7. I’ve dabbed in bitcoin a little bit. Not nearly enough to lose any sleep over. I believe it is ok to accept some risk given your age and if you have covered your basic Personal Finance bases like retirement, debt, emergency savings, etc. Of course I hope it skyrockets 😉

  8. I’ve speculated a bit on crypto(just had a post about it on my blog actually) and can see others jumping this year too driving the prices higher. I think another reason why crypto may seem attractive is that not only are the returns huge but the valuations of stocks are high too so some(myself included) are willing to take on the huge risk that comes with crypto because of the massive potential returns it offers.

    1. Have to accept the high risk to get the high reward. It is great to see people making money on crypto!

      I just hope that they don’t get in over their heads and manage their exposure. It also seems like something no one wants to hold long term which is a red flag for me. Everyone is trying to make their quick buck.

      To many hands reach in and charge you along the way…then ultimately if you realize a gain you pay taxes at the highest rate applicable to your income for the year ouch. Not for me but many have been minted over night and I certainly can’t down play that!

  9. Interesting thoughts!

    Personally I own Bitcoin, Ethereum, and Litecoin–although I keep them in my “speculative” part of my portfolio.

    I think it’s fine to own high risk high reward investments like this as long as it is appropriately a small percentage of your net worth. Even at a 2% allocation, it can have a dramatic impact on your net worth if it goes up a lot.

    And I think a lot of younger guys can/should definitely afford to speculate on it. It’s fine losing 5% or 10% of your net worth when you’re 22 and broke, but not okay when you’re 35+ with a spouse, kids, and mortgage!

    Just my 2 cents though 🙂

    1. Nothing wrong with some speculation, I think I would rather just head to Vegas though!

      I would agree that the younger folks can roll the dice.

      There is a lot of value in time though when you are young and I would rather have my little brother investing in a diversified mix of companies generating profits. With a smaller portion of portfolios though I would agree with you that it will not cause much harm long term.

  10. Hey DM! I’ve been reading your blog as of recently. I really enjoy it. I’ve been buying bitcoin and alt coins for the past 2 months. I’ve been doing pretty well actually! I’m sure a lot people have since they have been gaining traction. I’m fascinated with blockchain technology and how it will and is impacting our society/economy. My biggest holding currently is XLM (Stellar) because it has some real world value and is not a ‘bogus coin’ like other coins currently out there. If I received a 100k bonus, I would probably roll the dice and buy some speculative coins and some more conservative investments like real estate and index funds. Just my opinion. 🙂

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