Bitcoin is a blockbuster movie waiting to happen and as its price goes up and down like no financial asset I’ve ever seen, I went looking for a world-leading expert on this cryptocurrency born out of the internet/computer age.

The expert I interviewed recently for my podcast was ex-Goldman Sachs banker, Jeremy Ng, MD of the cryptocurrency trading platform Gemini. And this is where the movie script starts to get interesting:

Gemini was founded by Cameron Howard Winklevoss, who is not only an American cryptocurrency and Bitcoin investor, but an Olympic rower, who finished 6^th in the coxless pairs final with his twin brother, Tyler.

But these guys get even more intriguing with their link to Facebook. In 2004, their company ConnectU filed a lawsuit against Facebook, alleging that creator Mark Zuckerberg had broken an oral contract with them. The suit alleged that Zuckerberg had copied their idea and illegally used source code intended for the website he was hired to create.

Anyway, missing out on Facebook led to his bitcoin play and his net worth is estimated to be $US3 billion!

Though that could be halved since bitcoin has plunged from $US63,000 to under $30,000 since April.

To explain why the currency is under pressure, again the movie script gets dramatic.

Let me list the possible reasons for the volatility of bitcoin and its recent fall from grace. This chart right here below shows it.

Note that in June 2020 it was priced at $US9,274. And 10 months later, it’s $US 63,000!

So how come?

Try these reasons, which all add to my argument that “Bitcoin: the movie” is a real goer:

1. The Beijing bully boys in China want to ban it!
2. China agrees with other countries and regulators who dislike its volatility, the drain on energy resources to mine it and its use by criminals.
3. Worldwide regulators look poised to regulate it.
4. The US under new President Biden has demanded all bitcoin transactions over $10,000 be reported.
5. Tesla’s Elon Musk can drive the price up or down by a single tweet.
6. And El Salvador wants it to be its national currency, which could be a big problem if the value of the currency halves overnight!

Did I say this looks like a movie waiting to happen? Well, look at this assessment of El Salvador by travel website www.onceinalifetimejourney.com : “Despite crime rates are really high in El Salvador, the country is not as dangerous for tourists. ... Crime in El Salvador, as well as in the rest of Central America, is directly related to the smuggling of drugs (mostly cocaine) and weapons at the hands of the Maras, heavily armed street gang groups.”

But it’s not all bad and scary news for bitcoin.

Some big fund managers of the world say they’re holding 1-2% of their portfolios in bitcoin and other cryptocurrencies. Big names of finance like Ray Dalio, Bill Miller and Paul Tudor Jones hold bitcoin.

And some really smart market experts, like Tom Lee of Fundstrat Global Advisors, thinks it will be $100,000 by Christmas!

Clem Chambers, CEO of private investors website ADVFN.com and author of 101 Ways to Pick Stock Market Winners and Trading Cryptocurrencies: A Beginner’s Guide, wrote this in Forbes recently: “Fear of missing out (FOMO) is over, the meme mob is in abeyance and the “powers that be” are in crush crypto mode. “They won’t crush crypto and they will divert their attention to other matters as soon as the crash is over because the “job done” flag will be waving and they will get on with regulating the next firestorm, of which there will be no shortage in the post-covid world.”

He sees another leg down.“Then to me the crash is over and will be followed by a long period of sideways trading where investors should dollar cost average in to toward the next “halvening” and boom cycle.”

The odds looked stacked up against bitcoin but I’d never underestimate the fans of the asset, just like the gold bugs, who love and really believe in its worth (despite some really lean times when the price has been low and stayed low for some time, before booming back).

Gold 1970-2021

That period 1982-2005 was a long wait for gold lovers and that’s what sideways trading can do!

After interviewing Jeremy Ng, I did reflect on some of my smaller speculative investments such as Mesoblast and some tech stocks that were over-hyped. And it got me thinking about dumping those high-risk stocks and buying myself a bitcoin, as a long-term risk play.

Most of my investments are quality, blue chip income payers (like the banks) and so a bit of bitcoin might be worth a small ‘punt’ but I know it could all go to custard!

My investing style is to buy great assets when the market is smashing them. CBA last year at $58 was a natural buy but while bitcoin is loved by its fans as a quality asset, the world doesn’t agree with them.

It’s a high risk asset. But if the price falls more, I could be tempted to have a small ‘play’ and then play a long waiting game.

But then again, I might not. Risky investments are never compelling for me.

Have a look at the brief excerpt of my interview with Jeremy Ng and my chat with Paul Rickard on bitcoin after the clip. Paul’s not a fan.

You can listen to the full interview with Jeremy here.

As you can see, no financial asset has the drama, excitement, the celebrities and the heavy hitters that bitcoin has attracted. It does look like a movie waiting to happen.

And here’s one last take straight out of Hollywood’s LA Times: “How a California surfer helped bring bitcoin to El Salvador…”

Only in America!