Social Media x Crypto

The wonderful graphic of  https://cash.app/bitcoin

The wonderful graphic of https://cash.app/bitcoin

The next 100 million users of cryptocurrencies might very well come from the big social media platforms. We predict that in 2019 some of the big platforms will make their first moves. 

This trend really showed up on our radar in a real way when in January 5, 2018 Mark Zuckerberg, the CEO of Facebook, posted his new year’s resolution:

For example, one of the most interesting questions in technology right now is about centralization vs decentralization. A lot of us got into technology because we believe it can be a decentralizing force that puts more power in people’s hands. (The first four words of Facebook’s mission have always been “give people the power”.) Back in the 1990s and 2000s, most people believed technology would be a decentralizing force.

But today, many people have lost faith in that promise. With the rise of a small number of big tech companies — and governments using technology to watch their citizens — many people now believe technology only centralizes power rather than decentralizes it.

There are important counter-trends to this — like encryption and cryptocurrency — that take power from centralized systems and put it back into people’s hands. But they come with the risk of being harder to control. I’m interested to go deeper and study the positive and negative aspects of these technologies, and how best to use them in our services.

It became clear that the biggest social media platform in the world is seriously looking in to cryptocurrencies. It was followed by a report by Bloomberg in December of 2018 detailing how Facebook is developing a stablecoin for WhatsApp. WhatsApp is Facebook’s popular messaging platform with around 1.5 billion users worldwide — more than any other messing app. After Facebook this month (February of 2019) made their first crypto related acquisition, recently media reports have surfaced detailing their hunt for further crypto acquisitions. We are really excited about what Facebook/WhatsApp will do in 2019.

Jack Dorsey is the co-founder and CEO of Twitter and founder and CEO of Square, the mobile payment company. It is increasingly clear he is a major Bitcoin bull. In March of 2018 in an interview with The Times of London, he said:

The world ultimately will have a single currency, the internet will have a single currency. I personally believe that it will be bitcoin

He personally invested in Lightning Labs, a company developing the technology, Lightning, for scaling Bitcoin and shared the stage with its co-founder Elizabeth Stark at Consensus in New York last year.

Jack Dorsey and Elizabeth Stark

Jack Dorsey and Elizabeth Stark

Square’s CashApp is already a top 10 mobile app in the US for peer-to-peer payments — they have had the functionality to buy Bitcoin for a while (btw a functionality that was developed by their engineers here in Australia!).

I speculate that Square will soon enable Bitcoin as a payment method on their readers you see at merchants in many countries around the world:

Screen Shot 2019-02-12 at 10.31.19 am.png

Square could also be leading the adoption of Lightning and micro payments, as their CEO has confirmed is a question of ‘when’ not ‘if’ that technology is rolled out on CashApp. Lightning enables payments of as little as 1 Satoshi, that’s 1/100 millionth of a Bitcoin. Micro payments could make our money ‘streaming’ and enable us to get paid and pay for services on a per usage or per second basis.

But the reality is Jack Dorsey could very well have much bigger plans than that:

Screen Shot 2019-02-12 at 10.33.11 am.png

Maybe a little ‘Too soon’ but social media platforms like Facebook and Twitter could indeed become the new banks in the decades ahead.

Last year we spoke with Josh Goldbald from Mobilecoin. They work with Signal to launch a new privacy centred cryptocurrency. Signal has been on the frontier of messaging apps for some time. It was the legendary developer behind Signal’s technology, Moxie Marlinspike, that helped Facebook deploy its end-to-end encryption in WhatsApp.

Telegram with its 200 million users did an ICO last year. They raised USD 1.7 billion from over 100 investors. According to Media reports Telegram’s blockchain is 90% developed and is looking to launch as soon as next month with a focus on Asian countries including Japan. Telegram is already a favourite messaging platform in the crypto space and might be the first big social media platform to launch a native cryptocurrency.

Pavel Durov, CEO of Telegram, always dressed in black.

Pavel Durov, CEO of Telegram, always dressed in black.

It is clear that some of the leading social media platforms are gearing up to dive into the crypto markets. Due to the sheer size of social media and messaging platforms they could be the on-boarders for the next 100 million people into crypto. Watch this space in 2019.


Henrik Andersson is the Chief Investment Officer of Apollo Capital — Australia’s Premier Crypto Fund. The Apollo Capital Fund is a professionally managed portfolio of crypto assets, offering investors exposure to the fast growing crypto market. For more information, please see apollocap.io.

Apollo Capital's Response to the Australian Treasury Consultation

Apollo Capital is a multi-strategy crypto fund based in Melbourne, Australia. Apollo Capital invests in the crypto assets that are powering the next generation of computing infrastructure. Our investment process includes a regulatory review of compliance to relevant regulatory frameworks.

Definitions and Token Categories

1.1. What is the clearest way to define ICOs and different categories of tokens?

There is an increased industry understanding in categorising crypto assets. Note that we will use the term crypto assets as a broad term for all assets that are secured on an open blockchain network. Apollo Capital suggests the following categories:

  • Cryptocurrencies. These are crypto assets whose main purpose are ‘money-like’. This include crypto assets like Bitcoin and Zcash.

  • Tokenised securities. These are crypto assets that represent ownership and rights and would fall under the regulatory framework of a Financial Product. An example of this are tokenised shares with voting rights in a company.

  • Utility tokens. These tokens have a specific utility but doesn’t offer rights that reach the threshold of being categorised as a Financial Product under Australian regulatory framework. We believe examples of this include Augur and Maker.

We refer Treasury to the FCA recent ‘Guidance on Cryptoassets’ for a similar categorisation as above.

Drivers of the ICO Market

2.1. What is the effect and importance of secondary trading in the ICO market?

Crypto assets are often similar to early stage venture investing. One key differential factor is the early liquidity as crypto assets trade on exchanges. This increases price transparency and lowers liquidity risk compared to venture capital investing.

2.2. What will be the key drivers of the ICO market going forward?

The big boom in ICOs in H2 of 2017 was prompted by a market fuelled by speculation. ICOs have been around for around 5 years and will continue to play a role in launching new blockchain network independently of where in the market cycle we are.

Opportunities and Risks

3.1. How can ICOs contribute to innovation that is socially and economically valuable?

ICOs offer a way to bootstrap new networks by making early users stakeholders in a new network. This is a flatter and more democratic versus traditional venture capital investing. See this blog post by Chris Dixon (a16z) for further thoughts on this. Economically, as blockchain networks predominately are a new computing platforms for trust, massive savings can be made. See RMIT Prof. Jason Potts article ‘The $29 trillion cost of trust’.

3.2. How important are ICOs to Australia’s capability to being a global leader in FinTech?

Crypto networks are a new computing platform for trust. It heralds a new design space for entrepreneurs, investors and computer scientists to build global software applications that utilise this primitive of trust. This has, and will continue to, lead to an explosion of innovation, particularly in the finance vertical. ICOs are a way for crypto startups to raise working capital without such a heavy reliance of venture capital funding, itself centred in Silicon Valley. On a high level, ICOs are a new source of innovation funding - this should be taken seriously.

Specific to Fintech, Decentralised Finance, or #DEFI, is arguably the most promising emergent vertical in crypto.

There are projects that enable the borrowing and lending of assets peer to peer, i.e. without a bank or lending institution in between. Dharma and Compound are key examples here.

Other projects enable the creation of credit through a collateralised debt position. Similar to how people leverage their house as collateral to secure a mortgage, MakerDao allow users to collateralise ether, the native token to Ethereum, to draw out a debt position denominated in their USD-pegged token, Dai. Soon other assets will be able to be used as the underlying collateral.

Binance, the world’s largest exchange, is developing a decentralised exchange that will enable the peer to peer trading of assets. This exchange will allow users to retain custody of their assets throughout the trading process. And Binance have the resources to deliver - they made more in profit than Deutsche Bank in Q1 of 2017.

Crypto is both a patent threat to incumbent financial institutions and perhaps the biggest innovation opportunity of a generation. Australia should support, and incentivise, projects to be based in this country. Having clear ICO guidelines is a critical first step. As with any enterprise, certainty is highly valued.

3.5. Are there other risks associated with ICOs that policymakers and regulators should be aware of?

ICOs have been very polarising. Most are not worthy of the money they raised through their ICOs. Hype, no doubt, drove much of the ICO boom in H2 2017. Conversely, some ICOs have funded extremely innovative projects that are provided substantial value to investors.

Key risks associated with ICOs include:

  • Fraudulent promises and claims

  • Some bad actors targeting unsophisticated investors

  • The token sold in the ICO having little or no current or future value.

  • ICOs do not represent an equity stake in the enterprise. They offer few rights, particularly in the early stage of a network.


Regulatory Frameworks in Australia

4.1. Is there ICO activity that may be outside the current regulatory framework for financial products and services that should be brought inside?

It’s Apollo Capital’s view that crypto assets that are representative of a high enough level of rights in centralised projects are considered Financial Products under Australian regulation. All other crypto assets are either too decentralised or do not meet a sufficiently rights threshold to be considered a Financial Product.

4.2. Do current regulatory frameworks enable ICOs and the creation of a legitimate ICO market? If not, why and how could the regulatory framework be changed to support the ICO market?

More clarity is needed.

We believe increased regulatory clarity of what constitute a Financial Product would benefit innovation in Australia. We would like to emphasis the global nature of the crypto landscape.

Specifically we believe the relevant regulator needs to clarify what ‘rights’ a crypto assets need in order to be categorised as a Tokenised Security (our proposed categorisation above).  We believe that the rights associated with a token to fall under this category should be similar to traditional shares or debt instruments. We further note that section 9 of Corporations Act (Managed Investment Scheme) refers to a ‘common enterprise’. Apollo Capital believes crypto assets that are sufficiently decentralised cannot be categories as a common enterprise. Therefore we recommend the regulators evaluate the categorisation of crypto assets both along the lines of rights and decentralisation. As an example, in our view, a crypto asset with ‘shareholder like’ rights that are not sufficiently decentralised should be categories as a Tokenised Security regulated under existing framework of a Financial Product. If a crypto asset is either sufficiently decentralised or does not reach the threshold of rights it cannot be categories as a Tokenised Security and it should fall outside the perimeter of regulation of Financial Products. Apollo Capital believes that categorising crypto assets that are either sufficiently decentralised or do not have shareholder like rights as Financial Products would significantly impede the innovative landscape in Australia.


Henrik Andersson is the Chief Investment Officer of Apollo Capital — Australia’s Premier Crypto Fund. The Apollo Capital Fund is a professionally managed portfolio of crypto assets, offering investors exposure to the fast growing crypto market. For more information, please see apollocap.io.


Bitcoin and Ether are Oversold  -  Here's Why

In this post, I walk through some key indicators of health in a crypto network to demonstrate why Bitcoin and Ether may be oversold, relative to their network fundamentals. 

Both demand-side and supply-side factors are analysed. I look at:

  • Price (demand-side);

  • Transaction count (demand-side);

  • Price vs. Realised Capitalization (demand-side);

  • Hash-rate (supply-side);

  • Developer talent (supply-side).

Folks myopically analyse price movements (and price movements alone) as if they were the only factor determining a network’s health. This couldn’t be further from the truth. Look at Ripple’s token XRP’s market capitalisation relative to its node distribution, or at Ethereum Classic’s recent 51% attack. This is not to discount price as an indicator, but to view it as a relative indicator, not an absolute one. 

By looking at only price, 2018 looks bleak:

Source: coinmarketcap.com

Source: coinmarketcap.com

Source: coinmarketcap.com

Source: coinmarketcap.com

This is not the whole story, even from the perspective of price. Note that in the past 2 years:

  • Bitcoin has increased in value 3.88x 

  • Ether has increased in value 10.80x 

But even if you bought recently, don’t be alarmed. There is an indication of overselling relative to fundamentals. 

Comparing price to usage in the Ethereum and Bitcoin networks (i.e. price to transaction count)a clear divergence is visible:

Source: Apollo Capital. Data from coinmetrics.io

Source: Apollo Capital. Data from coinmetrics.io

Source: Apollo Capital. Data from coinmetrics.io

Source: Apollo Capital. Data from coinmetrics.io

Similarly, the next graph looks at Bitcoin’s Price vs. the Realized Cap. 

Realized market capitalization is a novel economic metric designed by Coin Metrics, a leading crypto data site. Because large fractions of cryptocurrencies tend to get lost or go unclaimed, a measure is needed that weighs coins according to their actual presence in the Bitcoin economy. This is what Realized Cap does. 

When we analyze Realized Cap against Bitcoin’s Price, we can again see that Bitcoin’s Realized Cap is substantially higher than its current price. This again indicates Bitcoin is oversold:

Source: Apollo Capital. Data from coinmetrics.io

Source: Apollo Capital. Data from coinmetrics.io

On the supply-side, the price of Bitcoin and Ether has fallen below the hash-rate for both proof of work networks. A higher hash rate is better when mining as it increases your opportunity of finding the next block and receiving the reward, and in turn secures the network. It reflects more people contributing more real world resources to each network.

Source: bitinfocharts.com

Source: bitinfocharts.com

Source: bitinfocharts.com

Source: bitinfocharts.com

Another supply-side indicator is that of developer talent. More work is needed to gather accurate data, but anecdotal evidence suggests that Ethereum is winning the battle over its major current rival EOS. Likewise, Bitcoin’s developer pool is similarly impressive, particularly in regards to the off-chain scaling solution Lightening Network. Looking at their respective GitHub contributions one way of doing this, but again, more work needs to be done in this area to draw any conclusions.

To summarise:

  • The price of Bitcoin and Ether has slipped markedly more than their respective network transaction count (i.e. real network usage is price inelastic);

  • Bitcoin’s Realized Market cap remains robust relative to its price;

  • Hash-rate in both Bitcoin and Ethereum are down substantially less than their respective prices.

  • Zooming out two years, both Bitcoin and Ether are some of the best-performing assets, with a return of 3.88x and 10.80x respectively. 

  • The developer pool of Bitcoin and Ethereum could be a moat that cannot be easily replicated, although more data gathering is needed here.

Valuation frameworks for crypto networks remain an inchoate and nascent activity. We have a long way to go. In most asset classes, there are agreed upon models, and only the models’ inputs are debated. In crypto, we are still trying to work out the models themselves.

However, relative to network fundamentals, Bitcoin and Ether look cheap. 

Happy 10th Birthday Bitcoin

Front page of The Times Jan 3, 2009

Front page of The Times Jan 3, 2009

Today marks the 10 year anniversary of the launch of the Bitcoin network on January 3, 2009.

The network started with what we know refer to as the Genesis block or block 0. Encoded in the Coinbase of this very first transaction is a message: 

The Times 03/Jan/2009 Chancellor on bring of second bailout for banks”.

Coinbase of Bitcoin’s Genesis block.

Coinbase of Bitcoin’s Genesis block.

(You can see this for yourself on eg. Blockchain.info’s block explorer if you enter the first transaction hash: 4a5e1e4baab89f3a32518a88c31bc87f618f76673e2cc77ab2127b7afdeda33b)

I think there are two reasons why Satoshi included this message:

  • It proves that the network wasn’t pre-mined. Bitcoin is a distributed timestamp server — by submitting a transaction to the Bitcoin blockchain we can prove that an event didn’t take place later. By including a headline from a newspaper, Satoshi proved it also didn’t take place beforehand. No one cheated, it was fair game with no undue advantage.

  • It wasn’t any message. Bitcoin has libertarian roots. The launch of Bitcoin took place during the last financial crises and and the headline talks about ‘bailout for banks’. Bitcoin unlike the banking system is not based on debt but offers an alternative form of money, a digital bearer instrument.

Ten years later Bitcoin has had an extremely consistent existence. Blocks are found about every 10 minutes, 24/7, 365, transactions are being confirmed and the network is growing. This is despite it being completely open, not controlled by anyone. It has endured an endless amount of technical and social attacks through the years. 

The longer an idea or a technology (really anything non-perishable) has been around without failing, the longer its future life expectancy — this is what author Nassim N. Taleb refers to as the Lindy Effect

We at Apollo Capital think that together with Network effect, the Lindy effect is key when looking at crypto assets. The network effect is why Bitcoin and other crypto assets have value despite having no IP, the code can be copied. The Lindy effect is the reason Gold has a value of USD 8–10tr while Bitcoin is at 68bn — less than 1% of Gold’s value. Gold has been around for a much longer time. The fact that Bitcoin has been around un-harmed despite all that has been thrown at it for the past 10 years bodes well for the next 10 years — it actually gives it more strength.

Today, the debt level in the banking system that caused the financial crises of 2008 is much less, however the total debt level in the world is at record levels. This is the front page The Times today, Jan 3, 2019:

Screen Shot 2019-01-03 at 11.43.16 am.png

The Times warns that a number of British universities are on the brink of a credit crunch after embarking on a record borrowing spree.

We believe the next financial crises that might be fuelled by a long period of record low interest rates and corporate debt will be a net positive for crypto assets such as Bitcoin. While crypto assets are currently off their lows, the volatility in the stock market just increased at the fastest pace ever

Crypto assets is an uncorrelated asset class, still very young, small with a potential big upside. We think it makes a lot of sense to have some in your portfolio or as Satoshi expressed it:

“It might make sense just to get some in case it catches on.”
- Satoshi Nakamoto

At the bottom’s of today’s edition of The Times there is a block hash. The coinbase transaction of that block includes another message.

“ThanksSatoshi”

Thanks indeed.


Henrik Andersson is the Chief Investment Officer of Apollo Capital — Australia’s Premier Crypto Fund. The Apollo Capital Fund is a professionally managed portfolio of crypto assets, offering investors exposure to the fast growing crypto market. For more information, please see apollocap.io.

Financial Privacy and Cryptocurrencies

As I write this blog post, the Australian government has just enacted a decryption bill that according to experts can only lead to systemic weaknesses that will put us all at risk.

Apple is protesting this bill in a letter saying:

“Encryption is simply math. Any process that weakens the mathematical models that protect user data for anyone will by extension weaken the protections for everyone.”

Apple and others are arguing that it is precisely because of the threats from criminals and terrorists that we need strong encryption.

Indeed it was likely software from an Israeli firm sold to governments and used by Saudi Arabia to spy on Jamal Khashoggi’s WhatsApp messages that later lead to his brutal murder.

MBS and Putin at G20 in Argentina.

MBS and Putin at G20 in Argentina.

Privacy has always been front of mind for the cypherpunks in the digital cash and cryptocurrency community. For many of these people privacy is a basic human right.

With Bitcoin, money for the first time became indistinguishable from speech. This was predicted by cypherpunks decades ago. Timothy C. May, a founding member of the cypherpunk movement, wrote in ’97 that ‘Digital Cash = Speech’. As Bitcoin and other cryptocurrencies are open source software (arguably a form of speech), lines of code are now money.

Is this a Bitcoin transaction or a classic text?

Is this a Bitcoin transaction or a classic text?

David Chaum and others worked on untraceable digital cash in the 90s. Hal Finney was one of the first people involved in Bitcoin and was also the first receiver of a bitcoin transaction. This was Hal’s first tweet after Bitcoin launched in January of 2009:

1_LSHrGdSm51Qu9H83Hp1eVg.png

Cypherpunks understood that if you like to support (including financially support) the opposition in say Saudi Arabia or Russia — a private means of communication might mean the difference between life and death. 

While Bitcoin is pseudo-anonymous, other cryptocurrencies offer in-built privacy. Dash was an early fork of Bitcoin offering a mixing technology for private transactions. Monero is a well known privacy focused coin using ring signatures which combines signatures to obfuscate the inputs to a transaction.

When Zooko Wilcox, a cypherpunk who worked for David Chaum at DigiCash founded Zcash, it marked a new area in private cryptocurrencies. Zcash uses zero-knowledge proofs to provide absolute privacy. We can think of zero-knowledge proof as a way to proof something without revealing our secret. As an example, when I log-in to password manager Lastpass, that service has stored a hash of my password. Since a hash function as one-way function, it is enough to transmit the hash of the password to Lastpass, not the actual password — in other words, I don’t have to reveal my secret.

Former CIA, nowadays President of the Freedom of the Press Foundation.

Former CIA, nowadays President of the Freedom of the Press Foundation.

We are now close to the launch of a new technology which combines privacy with scalability. This technology is called MimbleWimble and one implementation of this, Grin, is set to launch next month. A recent episode of the ‘What Bitcoin Did’ podcast gives a good overview of MimbleWimble and Grin. MimbleWimble transactions are based on proofs that input minus outputs are zero, thus very little data needs to be revealed and the blockchain will stay very small.

Grin is set to launch around January 15, 2019.

Grin is set to launch around January 15, 2019.

We are actively investing in some of the technologies helping to bring financial freedom to everyone in the world. Apollo Capital holds Bitcoin, Zcash, we invested in Orchid protocol which is building a more secure Internet and we look forward to the launch of Grin. For Bitcoin, the Lightning Network being built on top of Bitcoin could potentially provide more privacy there too.

The good news here is that cryptography is a rare technology where it is much easier (and not just a little bit easier) to defend yourself than to attack — due to a fundamental asymmetry behind public-key cryptography.

Open source + cryptography can and will continue to protect speech — both in the form of conversations and digital money. With the advent of encryption laws like we are seeing in Australia — open source software becomes a critical infrastructure for communication and free speech. With cryptocurrencies cypherpunks are extending the roam of free speech to digital money — a development very much still ongoing.

For those of you interested in staying safe online, The Electronic Frontier Foundation provides a good guide for ‘Tips, Tools and How-Tos for Safer Online Communications’.


Henrik Andersson is the Chief Investment Officer of Apollo Capital — Australia’s Premier Crypto Fund. The Apollo Capital Fund is a professionally managed portfolio of crypto assets, offering investors exposure to the fast growing crypto market. For more information, please see apollocap.io.

Crypto Dips & Dives: A Long-Term Perspective

Extreme hype or FUD (Fear, Uncertainty, Doubt) oftentimes drive the price of crypto assets up and down — this presents an opportunity for the long-term investor. 

Preface — Long Term Conviction is Critical 

[Skip ahead for Bitcoin Price Analysis]

Disclosure: I have no idea what makes the price of crypto assets rise or fall in the short term. I’m not a fan of charting, of triangles, of ‘support lines’, or reading tea leaves…

At Apollo Capital, we have strong conviction in a small collection of crypto assets. 

These crypto assets will likely be fundamental to the emerging Web 3.0 stack on which sophisticated applications hosting money, financial services, credit, debt, and derivatives will be built. 

Screen Shot 2018-11-29 at 4.14.19 pm.png

In the above graph, the top layer will consist of millions of applications mostly funded by equity. These will likely remain centralized entities, built specifically for the unique preferences, tastes, and regulatory climate of each target market. 

At the bottom, there will be tens of core blockchains. These are the railroads of the new Web 3.0 stack. Assets such as Bitcoin, Ethereum, and perhaps Dfinity and others will run on and will be funded by crypto assets. 

In between, we will have thousands of middleware crypto assets such as stablecoins, oracles, and file storage. Smart contracts built on top of blockchains will interact with these middleware building blocks. 

For example, in this new decentralized world that we call Web 3.0, a smart contract interacting with a stablecoin and an oracle could provide the basis for an application providing trustless and permissionless lending and borrowing. 

This exists — Dhama and Compound are two leading examples.

We see now that there will only be a few major winners in the core, fundamental blockchain layer. These blockchains will optimize on these key variables:

Key Properties of crypto assets

Key Properties of crypto assets

The key criteria to evaluate are: 

  • What is the project’s capacity to build the critical network effect?

  • Is the optimization between the different ‘properties’ attractive (listed above) and differentiated enough from other projects? 

Value will accrue to moneyness and governance, not utility tokens. There will be a limited number of successful crypto assets that will be tremendously valuable. 

We will trust these blockchains to run the world’s native crypto assets, decentralized applications, and today’s securities. 

I bring all this up to demonstrate the key attributes of quality crypto assets. 

When investing long-term in crypto, a conviction in the value of your assets is critical — because in this market, weathering multiple 50–90% dips in your asset’s value is a certainty, and it’s how one reacts and responds to these events that is important. 

In the rest of this article, I will go back in time and look at Bitcoin’s price data. I limit this analysis to Bitcoin because it has the largest sample space and is used as a leading indicator for other crypto assets. 

This will demonstrate that we have seen many bubbles and many bursting bubbles in the history of bitcoin. It is part of the course when investing in an emerging form of money. 

I hope that this will make you feel more confident in the longevity and robustness of quality crypto assets over time. 

Bitcoin Price Analysis 2010–2018

July 2010: The first major increase in the price of Bitcoin. The price of bitcoin increases from $0.008 to $0.08 (a 900% increase) in five days.

June 8, 2011: Bitcoin reaches a new all-time high of approximately $30. This is often thought of as the ‘First Bubble’ in bitcoin:

Screen Shot 2018-11-29 at 4.17.21 pm.png

July to October 2011: The bubble then bursts and the price of bitcoin declines by about 95%.

Screen Shot 2018-11-29 at 4.18.12 pm.png

Early 2013:From March to the beginning of April the price of bitcoin soared from$32 to a new record high of $230:

Screen Shot 2018-11-29 at 4.18.49 pm.png

April 2013: Bitcoin then plummeted for about a week — all the way to $68 — a decline of 70%.

Late November 2013: On the MtGox exchange, the price of bitcoin soars to its highest price of approximately $1,100.

February 2014: it was discovered that the price increase over October — December 2013 was partially due to the closure of MtGox and the 800,000 lost bitcoins that were the cause of the start of the bear market.

The price of bitcoin plummeted over the rest of rest of Q1 2014:

Screen Shot 2018-11-29 at 4.20.49 pm.png

The price of bitcoin did not begin to significantly recover again and worsened. In August 2015, bitcoin was trading at approximately $200 — an 80% decline.

There was a slow recovery, and it took until January 2017 for it to reach the $1000 region again:

Screen Shot 2018-11-29 at 4.21.24 pm.png

January to October 2017:the price of Bitcoin climbs to $6000 (a 500% increase):

Early December 2017: Bitcoin surpasses $10,000, marking a 900% increase in price that year.

Screen Shot 2018-11-29 at 4.22.25 pm.png

And it didn’t stop. 

December 17 2017: Bitcoin reached a record high of $19,783, just falling short of $20,000. 

January 2018 — Now: Bitcoin has declined approximately 78.5% from its high of approximately$17,000 to $3700–$4000in recent days. 

We have seen this all before. We have gone through multiple steep, downward corrections in the history of bitcoin. And we will go through some more until this money is freely and widely accepted globally. 

Gold as money has been accepted for millennia —  Bitcoin has only existed for 10 years. These things take time.

Keep in mind one thing: throughout all these turbulent moments, the fundamentals of Bitcoin have not changed. 

If you have conviction in the need of a digital hard money, a global decentralized settlement layer for the internet, for Web 3.0, these short-term price cycles should be seen as a blessing: they present buying opportunities. 

James Simpson is an investment analyst at Apollo Capital — Australia’s Premier Crypto Fund. The Apollo Capital Fund is a professionally managed portfolio of crypto assets, offering investors exposure to the fast growing crypto market. For more information, please see apollocap.io.