If you’ve been paying attention, you’ve probably heard that Bitcoin is on quite a roll.
After starting 2017 priced at $1,000, BTC recently broke through the $3,000 level and seems to be making a new high every day.
And, it’s not just Bitcoin that’s on fire. The entire world of cryptocurrencies (of which Bitcoin is the largest and most well-known) is exploding.
While Bitcoin has entered the public vocabulary, you’ve also likely started hearing the term “blockchain.” The Blockchain is the software that Bitcoin is built on, and if you haven’t heard of it yet, I guarantee you will very soon.
That’s because Blockchain is fast becoming the business buzzword of the day.
Just like every business idea in 2010 had to have social media bolted onto it somehow, and in 2015 every startup was the next “Uber of whatever,” it seems all the cool kids are blockchaining their startups in 2017.
There is an amazing amount of hype behind cryptocurrencies and blockchain technology.
New ICO’s (Initial Coin Offerings) are announced every day, and it seems like there’s no problem in the world that some aspiring entrepreneur doesn’t believe can be solved by utilizing blockchain technology.
So, in the middle of all this cyber-commotion, I’d like to suggest that cryptocurrencies may have a place in your prepping plans.
Let me first come clean and admit that I’ve been involved in Bitcoin and cryptocurrencies for more than five years (you can read my first article on Bitcoin from four years ago here). I’m a technology early adopter and fell in love with Bitcoin the first time I heard of it.
As a freedom-loving, government-distrusting libertarian, what’s not to love about technology that promises anonymity and untraceability in financial transactions? Dangle that idea in front of me and I’m going to jump on it every day of the week! (It turns out Bitcoin is not completely anonymous and untraceable but there are ways around that.)
So, does that mean I’m biased towards cryptos? Probably. Does that mean you shouldn’t listen to what I have to say? That’s up to you, but I believe in keeping an open mind and learning what I can, so IMHO I think you should keep reading.
The case for prepping with Bitcoin:
Whenever I bring up cryptocurrency to my survivalist friends the first objection is always something like, “Ha – money that relies on the Internet. That’s a genius idea. Just wait until the Internet goes down for a few days and all your bits and bytes disappear. What are you going to do then?”
My response to that softball is simple – there are plenty of very easy and effective ways to store and backup your cryptocurrency so you can readily recover it in the case of an internet outage.
Can you lose all your crypto if the Internet or your storage hardware fails? Yes, you can.
Just as there are an infinite number of stupid ways to lose anything of value, you can certainly find a way to lose your crypto if you try. However, given a little bit of foresight and effort, you can make certain your bits and bytes are safe.
After swatting away that first objection, my prepping friends usually take it all the way to 11 and hit me with the EMP scenario. With a smug look on their faces, they checkmate me with, “Well, when NK explodes one of their orbiting EMP satellites over the United States and takes down our entire electrical grid, how are going to spend all your digital money then?”
They have a point with that one. If we get EMP’ed or solar flared back to the Stone Age, my cryptocurrency will be useless. (So will their new F150, but that apparently doesn’t matter to their argument.)
But that’s not the point.
As preppers and survivalists, we plan for a variety of scenarios. We make decisions about what negative events we believe are most likely to happen and then, based on our available resources, we do our best to prepare for them.
No one can prep for everything. There are just too many ways the crap can hit the fan. We all have to prioritize and make trade-offs in our preparations. The key is to stay flexible, take steps that give you the biggest bang for the buck and always keep your mental threat antenna well-tuned.
In my calculus, one of the most likely SHTF scenarios involves massive economic disruption.
Any number of things could trigger it (a deep recession, massive deflation, hyperinflation, public union pension crisis – the list goes on and on) but I believe something will happen soon that will have a serious impact on our economy.
The can-kicking has just gone on too long. Something will give at some point.
In my economic crisis scenario, our currency will be greatly impacted. The problem is, I don’t know exactly how.
There’s a raging debate right now between those who believe we’re headed for hyperinflation and those who foresee massive deflation (then possibly followed by hyperinflation).
I’m not smart enough to know who’s right so I do my best to prepare for both.
Precious metals should be a good store of value in hyper-inflation so I stack as much gold and silver as I can.
In deflation, cash will likely be king. However, banks may be in trouble and not be in the mood to hand out greenbacks, so I keep some cash hidden at the homestead.
Wrapped up in all this is the giant unknown of how our government will react during the crisis. My guess is they will react how governments always do during a crisis, by clamping down on our freedoms.
That likely means capital controls – the government forcing me to keep my money right where they can keep their eyes on it.
Cryptocurrencies offer some unique possibilities in each scenario.
I’ll be the first to admit I have no idea how Bitcoin will behave during inflation or deflation, but I do know it gives me another option.
BTC may go up, down or become entirely worthless, but I like the idea of having it as a wildcard in my prepping portfolio.
As far as avoiding capital controls, we only have to look to China as an example. Much of Bitcoin’s recent rise in value has been attributed to sizable numbers of Chinese using it as a means to transfer their wealth across borders and away from their totalitarian government.
The goal of all this is not to convince you that Bitcoin and cryptos are right for you.
That’s something you need to decide for yourself. The world of cryptocurrency has a Wild West feel to it right now. Coin values fluctuate greatly and the usual caveat applies of only to invest money you can afford to lose.
My advice is to simply keep an open mind and take the time to learn more about Bitcoin and cryptocurrency. You may be glad you did!
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