Day 345: Bitcoin Fidelity


Mother's Little Helper portfolio was DOWN today -$5,296.88 (-0.63%).

Overall GAIN YTD: +$245,655.88 (+42.07%).

Our benchmark index, the S&P 500 is up +19.00% Year To Date.

http://money.cnn.com/data/markets/sandp/

The Markets are waiting on tomorrow's Fed decision, which is expected to produce an increase for the fed funds rate. The tax reform reconciliation process should generate some attention tomorrow. Anecdotally, Bitcoin was up while gold was down? Are investors switching to Bitcoin instead of gold for a safe haven? Only the algo's know for sure.

Even though I got the day count wrong in my last post, Day 346: Bitcoin's Future, it became the most read post so far. In fact it's been read more times than there are subscribers to the blog. This Friday morning I will be interviewed on The Bigger Picture, a New York based Facebook Live talk show. The show is hosted by actress Jordan Baker and entrepreneur Risa Hoag. The show airs this Friday December 15th 8:00am EST (5:00am PST), I think I come on about 8:30am (5:30am PST). Go to this link to tune in or check in at a more reasonable hour, all the past shows are available. The Bigger Picture

I guess I got off track somewhere along the way with my Day Count. According to EpochConverters today is day 345 of the year. Well, I did say at the beginning of the year that I was going to make a fool of myself along the way.

Bitcoin and Fidelity Investments

As I continue to invest in crypto-currencies and research the marketplace I've come across a quiet story that frankly was off my radar. With all the noise about what bitcoin is and isn't, and the news that the Chicago Board of Exchange (CBOE) and the CME Group and others are opening futures exchanges, something else was happening in the background. A quiet little investment firm with a mere $6.2 Trillion dollars of assets under management began tinkering with Bitcoin. That's right Fidelity Investments is interested in Bitcoin.

One of the first experiments was to allow employees to use Bitcoin to pay for their meals in the company cafeteria. Not many do, as the CEO quips, they have a lot of brown-baggers at Fidelity; good to know. However the experiment turned up some interesting observations. An employee who bought an item in the cafeteria with Bitcoin wanted to return the item and found that wasn't so easy, mainly due to the time lag of receiving and then sending the Bitcoin back through the system; there's still too much friction for this type of purchase.

Fidelity then decided to expand their in-house experiment and added crypto-mining computers to get into the Bitcoin mining business. It's not really a business for them, I think experiment really is a better definition of Fidelity's level of involvement. Most recently Fidelity and Coinbase have partnered to allow Fidelity clients to see their Bitcoin, Etherium and Litecoin investments within their Fidelity accounts. Fidelity hasn't allowed their customers to do any trading in Bitcoin, but for now they can see all their investments in one place. Clearly Fidelity Investments has identified something in Bitcoin and other popular crypto-currencies that makes this worth their time; it's disruptive to their industry.

Disruption Is Good

The point is, ladies and gentleman, that Disruption -- for lack of a better word -- is good.

Disruption is right.

Disruption works.

Disruption clarifies, cuts through, and captures the essence of the evolutionary spirit.

Disruption, in all of its forms -- Disruption for life, for money, for love, knowledge -- has marked the upward surge of mankind.

And Disruption -- you mark my words -- will not only save Teldar Paper, but that other malfunctioning corporation called the USA.

Fidelity employees can also use Bitcoin to make donations to charity through the companies Fidelity Charitable Donor Advised Fund. Fidelity looked at this new landscape and made a bold statement that they would actually become an expert on the subject and not just brush it aside and call it a fraud. Actions do speak louder than words.

"Yes, proof of normalization is in the fact that Fidelity is offering this service," says Gina Pieters, an economics professor at Trinity University. "Actions speak louder than words. Plus, there is also the likelihood of a Bitcoin ETF -- possibly an Ethereum ETF as well."

Stay Invested

Clay Baker

Disclosure: I am personally invested long in these stocks that appear in the MLH portfolio and may purchase or sell shares within the next 72 hours. I am also invested in other stocks that do not appear in the MLH portfolio: BA, BRK.B, CELG, CSCO, CTXS, CVX, DOW, DVAX, FB, IBM, NTES, NVDA, OMER, PFE, PG, RDHL, SCHW, TBT, THO, TWX, VEEV, VZ, XLNX, XOM, Bitcoin, LiteCoin

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article. This article is not intended to offer investing advice, guarantee 100% accurate predictions, or to be interpreted as providing a personal recommendation.

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This material is provided for informational purposes only, as of the date hereof, and is subject to change without notice.
This material may not be suitable for all investors and is not intended to be an offer, or the solicitation of any offer, to buy or sell any securities.

© 2016 by Clay Baker all rights reserved