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Posts in category ITD

ITD – @MarketWatch, @saumvaish #Bitcoin

Today’s Tweet comes from @MarketWatch and @saumvaish again. This is a follow up to yesterday’s tweet of the day, which stated that Bitcoin was allowed in Fidelity IRAs. According to this they have subsequently announced that they will no longer be allowing people to invest in bitcoin through their IRAs. A bit of a retraction if I do say so myself. But the overall theme of Bitcoin at the moment is instability and needing to get control of it. This is proof of just that.

In other Bitcoin news JP Morgan decided to go back and renew a patent that was 13 years old. What is this patent for you ask? It’s for a digital payment network that supports completely anonymous payments. Source ArticlePatent

Source: Article, MarketWatch Tweet, saumvaish Tweet

ITD – @saumvaish

The Investment Tweet of the Day comes from @saumvaish This article talks about how Fidelity now allows clients to put the Bitcoins that they have invested in, into their self-directed IRAs. They have partnered with SecondMarket for form up a Bitcoin investment trust that invests strictly in the virtual currency. See sources below.

Now many people don’t really understand what Bitcoin is. In short a bitcoin is a currency, however it is not a tangible currency. This is a digital currency “mined” by computers solving cryptographic equations, ie code breaking. In effect you have paid legal tender, to consume electricity, to solve these equations, to receive bitcoins. USD=>Bitcoin

Now the trick here is that the equations are tied back to the transaction of a bitcoin from one wallet to another wallet. All bitcoin wallets are visible to the public, however no one knows who’s wallet is whos, except the owner. When one owner wants to move money to another owners wallet, for payment. This transaction is made public, and put in a block, or queue, and everyone gets to see the key that is sent and the “code” that needs to be broken. The miners then try to perform this transaction as fast as possible in order to allow the transaction to be performed. The reward for such a feet is of course bitcoin.

So the way that this “tender” starts to be of real value is that it gets harder and harder to break these codes driving the price up. What also is driving the price up is that this is not regulated or backed by anyone. Meaning unlike our legal tender that is backed by our central bank and regulated by the government, bitcoin isn’t. Which is why you have been seeing giant swings in the price Now there is a cap to the total amount of bitcoins in the network at 21 million.

If you are still confused see this infographic/presentation on Bitcoin (press left to cycle through the slides)

Source: MarketWatch, Tweet

ITD – @CassSunstein

The Investment Tweet of the Day comes from @CassSunstein He is currently a Professor of Law at Harvard University. He also served under President Obama as an Administrator of the Office of Information and Regulatory Affairs, from September 10, 2009 until August 21, 2012. This article comes from a similar vein as yesterday’s ITD.

This article dives down into how the top 1% have continually enjoyed an annual income increase of 86.1% from 1993 to 2012. Whereas the rest of the income pool has only seen a 6.6% annual increase. This equates to the top 1% receiving 68% of the total income growth over that period. See the source article for more details.

Source : Bloomberg, TweetSunstein’s Wiki