Crypto’s Recovery & Why Now May Be The Best Time To Invest

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We’re reaching out in these times to provide some additional information and a few reasons why now may be the best time to step into the world of digital currency.


In our previous communications, we’ve pointed out that assets with high liquidity and no counterparty risk recover quickly after a deflationary crash and that Bitcoin (among other cryptocurrencies) fits that description. Since the crash, we’ve been monitoring performance and we see this very trend has come to pass. As we predicted, Bitcoin is outpacing other asset classes, up a whopping 35% between March 12 and April 3rd. By way of comparison, Gold was only up 3% during the same period.


Certainly, the traditional markets have been on a tear this month with the introduction of the new stimulus packages. Time will tell whether this does promote long term recovery, however, while there is still a lot of speculation about what is going to happen in all markets, we feel the graph above demonstrates the absolute resilience of Bitcoin and why you should agree that it deserves a place in a modern portfolio.


The Bitcoin Halvening Event is the most important cyclical phenomenon impacting the supply of Bitcoin and subsequently its price. It happens every 4 years; it’s coming up on May 10th. For those not familiar with this concept, it means that the rate of supply of new Bitcoin being introduced into the market will be cut in half. This is important for a couple of reasons. Let’s start with the fact that Bitcoin is an asset that was created with built-in scarcity; that is, there are and only ever will be 21M actual Bitcoin in the world.Now let’s note that the demand for Bitcoin is increasing, gaining more and more acceptance every day. Furthermore, effective April 1st, the brand-new COO of the Treasury is the former Chief Legal Counsel at Coinbase and a vocal cryptocurrency advocate. This seems to indicate that the US government is now more accepting of crypto and digital assets.

The Covid-19 pandemic has underscored the value of Bitcoin. While many economies around the world are reeling, people are now paying close attention to self-sovereign assets like Gold, Silver, and yes, Bitcoin.So, now we have increasing demand and in about a month we’re about to see the issuance rate cut in half.The world is poised to demand more and after May 10th, much less supply is going to be available. This all points to an appreciating asset.


Note that the scale to the left is logarithmic, not linear. At the 2012 Halvening, Bitcoin went from average prices of tens of dollars to hundreds of dollars per coin. Likewise, at the 2016 Halvening, it went from hundreds of dollars to thousands per coin. Should this trend repeat we could see Bitcoin move from thousands per coin to tens-of thousands and perhaps even higher this time around.

Today is April 15thand The Halvening is happening next month, so if you’re considering adding crypto to your portfolio as a true hedge, as an outperforming asset class, or you would like to simply have a stake in the future, we would love to speak to you

We have many other market insights. For those of you interested in Tradecraft’s perspective, I’ve attached excerpts from our most recent quarterly report. I look forward to speaking with you and, until then, stay safe and sane, and we will continue to keep you informed and Decrypt: Crypto.

About the author James Diorio

James is a Principal and Chief Executive Officer of Tradecraft Capital.

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