All posts by Adam Sharp

Adam Sharp is the Founder of Early Investing, a new website and e-letter focused on equity crowdfunding. He is an active investor in more than 70 private startups. A former financial advisor, he also has extensive experience with Internet marketing and financial writing. Adam has worked as a marketing consultant for sites including and He has built three profitable web businesses.

Hedge Funds Love Cryptocurrency

During the first few years of bitcoin’s existence, its users were largely libertarians and cryptography enthusiasts. People who believed in the idea of an independent currency secured by a unique cryptographic solution.

Of course, there has always been a portion of its base consisting of speculators and investors. And I bet most of its early true believers would admit they also like the price appreciation that comes as adoption grows.

Over the last year, however, things have changed. Bitcoin is suddenly a $68 billion entity. That number represents the market cap (the total value of all coins in circulation today). You get that $68 billion by multiplying the current number of coins (16.5 million) by today’s price ($4,144 as I write).

The New York and Silicon Valley money crowds have officially taken notice. Many of them started out simply drooling over the returns. But a portion of them have fallen in love with the underlying idea and tech.

The result is an ongoing explosion in the number of funds dedicated to investing in cryptocurrencies and tokens.

CNBC’s Brian Kelly recently said that about 70 cryptocurrency hedge funds have recently launched at a “frantic pace.”

One of those funds is Kelly’s own Digital Asset Fund. I happened to meet one of his investors at a conference, and he seemed very pleased with the fund’s performance thus far.

AngelList founder Naval Ravikant co-founded one of the first crypto hedge funds in 2014, called MetaStable.

Naval is one of the best angel investors on the planet. He invested in Uber in its first round when its valuation was about $5 million. That’s just one of his many great early-stage investments.

MetaStable raised $60 million in a year when the price of bitcoin ranged from $770 to $300. So I’d imagine it’s doing quite well…

And now billionaire Mike Novogratz has announced a $500 million fund dedicated to investing in cryptocurrency.

As reported by Bloomberg

With a $500 million hedge fund, Novogratz will be able to capture trading opportunities that require more scale, as well as wield influence with developers, entrepreneurs and regulators. Of course, he’ll also make money on other people’s money: The person familiar with his fund, who has seen early versions of marketing documents, said it will charge investors a 2% management fee and 20% of profits, with a two-year lockup.

Novogratz made a killing in cryptocurrency when he first bought $500,000 worth of Ethereum at less than $1. As I write this, it trades around $298. The trader told Bloomberg that he’s taken $250 million in profits so far.

Three of the premier venture capital firms in the world – Sequoia, Union Square Ventures and Andreessen Horowitz – are also investing heavily in the space. To say this is the smart money would be a bit of an understatement.

All of this interest from sophisticated investors has caused the price of bitcoin to rise from around $1,000 at the start of this year to a recent peak of $5,000.

And while all the new hedge funds have brought more institutional interest in cryptocurrencies, we’re still talking small time here.

Let’s compare the size of bitcoin ($68 billion) to some other common investments:

  • Ethereum: $28 billion
  • Alphabet (Google) market cap: $660 billion
  • S&P 500 companies combined market cap: $20 trillion
  • Total estimated U.S. household wealth: $118 trillion.

With the total cryptocurrency market valued at around $144 billion today, we’re talking about a small drop in a very large bucket.

The vast majority of financial institutions can’t even buy cryptocurrency, because it’s not a recognized security. It would go against their charters, which put restrictions on the types of assets they can purchase.

Bitcoin ETFs would give the entire financial world a simple way to buy in. These have been in the works for more than three years, but the SEC has thus far rejected them.

Most recently, it denied the Winklevoss Bitcoin ETF in March of this year. It should be noted that Dalia Blass has been tapped to head the SEC’s Division of Investment Management, which regulates – and approves or disapproves – ETFs. She also happens to work for the law firm that represents the Winklevoss twins… so there’s hope.

I’m not sure how much longer regulators can stall on the issue. With bitcoin volume surging to more than $2 billion per day this year, the demand is clearly there.

Tyler Winklevoss said his team is committed to bringing the fund to market…

We remain optimistic and committed to bringing the Winklevoss Bitcoin ETF to market, and look forward to continuing to work with the SEC staff. We began this journey almost four years ago, and are determined to see it through.

If they succeed, the implications for bitcoin would be substantial. This would provide a way for every investor and money manager to buy bitcoin from their retirement or brokerage account. Demand would skyrocket overnight.

There is already one publicly traded option: the Bitcoin Investment Trust. But I don’t recommend it. It trades at a huge premium to the price of bitcoin (which once again shows that the demand is there), so it’s much better to purchase crypto directly from an exchange.

If you do, you’ll be getting in before the big institutional and retail flood that many of us fully expect.

It’s one of the biggest reasons I’m so bullish on cryptocurrencies. If you go long now, you’re taking more risk in exchange for much larger potential returns.

It’s simply the best risk-reward scenario I’ve ever come across.

For guidance on navigating this thrilling young market, take our research service for a spin. You can learn more about it here.

Good investing,

Adam Sharp
Co-Founder, Early Investing

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Source: Early Investing 

The Dollar vs. Bitcoin

The U.S. government will pay $474 billion in interest on its debt this year. And that’s with rates around 1%.

Total debt is now $19.845 trillion, and it just exceeded annual GDP.

Our unfunded liabilities top $100 trillion.

I believe that eventually we’re headed for a financial reset. I don’t know exactly when or how. That will depend on the whims of bankers and politicians.

But I can’t picture any long-term (20-year) scenario where the dollar does well. There appears to be zero chance of cutting federal spending anytime soon. It should have happened long ago, yet the spending seems destined to keep rising until the whole thing implodes.

Eventually the interest on the debt will become unsustainable, and we’ll have to start monetizing our debt on a massive scale. I’m not saying we’ll default on our bonds. I’m simply questioning whether the dollars they’re paid back with will have much value.

When this happens, we’ll have an opportunity to choose a new system. I would vote for a cattle-based monetary system over the current one, personally.

But luckily we have bitcoin. The rise of cryptocurrencies like bitcoin may prove to be a catalyst that speeds the transition.


Cryptocurrencies offer a path forward to a new and better monetary system.

A system where the money supply can be hard-coded. One that doesn’t require middlemen… and that vastly increases efficiency.

It’s no coincidence that bitcoin is rising now.

Bitcoin was launched amid bank bailouts in 2009 by a guy who thought the financial system was broken. Fortunately, Satoshi Nakamoto was a genius, and he created a brilliant piece of software.

It’s growing exponentially now because people are looking at the current system, shaking their heads and then looking for something else.

And bitcoin is transforming the financial world with blockchain because the technology is superior.

People want this. They want a way to store value and trusted transactions that doesn’t suck.

If this crazy monetary revolution does happen, don’t you want to own at least a piece of it?

Cryptocurrency ownership rates are still well under 1%. If you do buy, you’ll still be doing so extremely early.

Good investing,

Adam Sharp
Co-Founder, Early Investing

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Source:  Early Investing

It’s Bitcoin’s Time to Shine

One of the first purchases ever made with bitcoin was pizza.

In 2009, an early user sent 10,000 coins to a friend who in exchange ordered him two Papa John’s pizzas.

Those same coins used to order pizza would be worth $27 million today.

Back then, the cryptocurrency community was tiny. There were no exchanges.

Today, around $2 billion worth of bitcoin is traded daily. That’s a higher volume than that of the SPDR Gold Trust (the most popular gold ETF), as recently noted by Bank of America.

You can spend bitcoin at an increasing number of places. But as I’ve mentioned before, that’s not the real purpose.

Bitcoin is digital gold. You hold it, and it appreciates in value over time as it spreads to more users.

Having Its Moment

The cards are lined up perfectly for bitcoin. Its primary competitors are all vulnerable to disruption.

For example:

  • Trust in the government is at an all-time low.
  • Stocks are expensive.
  • The government is printing fiat money like never before.
  • Precious metals have been flat.
  • Bond and CD yields are tiny.

Then there’s bitcoin, the best-performing asset ever, up 45,000X or so. It’s the only asset that can be easily sent around the world, safely stored on a USB stick in your pocket, and turned into cash almost anywhere.

Bitcoin is “mined” by very powerful specialized computers. It takes a lot of energy to do this cryptographic work (which helps secure the network). Bitcoin mining has become an industry, with hundreds of millions of dollars being spent on equipment and energy.

Bitcoin is also decentralized. It runs on hundreds of thousands of computers all over the world. That means you can’t shut it down. The network cannot be seized or easily blocked.

Bitcoin evolves over time. Changes to the software can be proposed by anyone and are voted on by bitcoin holders. Miners have significant influence as well.


Bitcoin’s biggest problem is that it can’t handle today’s transaction volume. The network’s jammed, so transactions can be slow, often taking hours to confirm.

Multiple fixes are in the works and are being fiercely debated by miners and owners.

But I’m not too worried about this. It’s in everyone’s best interest to fix the issues, and some of the smartest people in the world are working on these problems.

That’s another thing about bitcoin – it attracts math geeks, techies, libertarians and alternative investors. This is a good (and large) demographic for an asset to have.

Broadening the Base

Bitcoin’s base is expanding. It used to be hard to buy bitcoin, which restricted growth. Not today. It takes just a few minutes, and you can pay with a credit card or a debit from your bank.

In the coming days, we’ll have a detailed 10-page cryptocurrency report coming out. It has four specific coins I’m bullish on (one of which was up 25% yesterday).

All members of First Stage Investor will get access to it. My latest presentation, which includes the aforementioned cryptocurrency report AND four coin plays, will hit your inbox in the next week or so.

Click here to learn more…

What Happens if Bitcoin Goes Mainstream?

Over the last few years, two new investment opportunities of note have come online.

Both have the potential to rise in value more than anything else available to the general public… in history.

The first is private startup equity (equity crowdfunding). This gives everyone the chance to invest very early in companies that are small enough to grow 100 times – or more.

The second is digital currencies (bitcoin and others). And that’s what we’re going to talk about today.

Specifically, we’re going to explore what would happen if bitcoin went mainstream.

As is the case with most new disruptive technologies, the world’s never seen anything quite like crypto. There’s still quite a bit of skepticism to overcome.

Bitcoin is still in the very early adopter phase, which means it still has quite a ways to go, assuming we’re headed for mainstream adoption.

To get an idea of what “going mainstream” looks like, here’s a chart showing the rate at which consumers adopted various new technologies.

You’ll notice that each curve is roughly S-shaped, and that over time, adoption grows faster. For example, it took around 35 years for the refrigerator to reach complete adoption, while it only took around 15 years for the cellphone.

With bitcoin and cryptocurrencies, we’re in the first inning. Perhaps 1% of Americans own any at all. Crypto adoption today is where cellphone adoption was in 1992.

Cryptocurrencies are high-risk, high-reward assets. As such, they should make up only a small percentage of your overall portfolio.

It’s not a sure thing it’ll hit mainstream adoption. But it’s looking more likely every day.

Because as more people make money off bitcoin, more of their friends hear about it. More people get interested and eventually become comfortable enough to invest.

This is bitcoin’s secret to viral organic adoption. And unless a black swan event happens, it will continue doing its thing.

What’s the Price?

Let’s say 1% of Americans own bitcoin today – roughly 3 million people. How will the price look as the other 318 million buy?

And let’s not forget that bitcoin is huge in Asia, Europe and South America. And it’s getting more popular in Africa too.

There are only 21 million bitcoins that can exist. Fifteen million already exist today, and the rest will be mined over the coming decades.

It’s not a lot of coins to go around, is it?

Each coin costs around $2,600 today. If bitcoin goes mainstream, the price will go orders of magnitude higher.

The volatility will be extreme at times. But progress marches on. Every day it gets easier and safer to buy bitcoin, and consumers have more options to choose from.

So if you think you’ve missed out on bitcoin, look a little further into the future.