“To grow, you have to constantly learn, you have to constantly move, constantly improve. That’s the key. That’s what makes life fun, I think.”
Truth be told, I’m not an avid sports fan. I have always appreciated athletic prowess and respect the sacrifices that great athletes have had to make to reach the pinnacle of their careers, but friends and family alike will attest to the fact that I don’t typically follow the latest happenings in sports.
Like many though, the tragic news of the passing of Kobe Bryant earlier today struck a chord for me. Perhaps it was the sudden nature of it all, considering the conflicting media reports as the story first broke and the several hours that elapsed before the details of the helicopter crash that took his life and the lives of others, including his thirteen year-old daughter, Gianna, were finally confirmed. May they rest in peace.
In reflecting on Bryant’s passing, I was reminded of an interview he had on CNBC years ago, and the quote attached to this blog post in particular. Bryant will be remembered as one of America’s greatest athletes, no doubt. Yet as the interview reflects, he was a man of many interests. For example, not many may be aware of the fact that he co-founded a $100M venture capital fund, Bryant Stibel, shortly after his retirement from the NBA in 2016. In a follow up interview several months ago, it was revealed that the fund had grown to over $2B since its launch.
Let’s consider Bryant’s suggestion that one must constantly learn to grow. When applied to investing, this advice can shape long-term success for those who embody it. With the start of the new decade, I’d like to take the time to assess the direction of the cryptocurrency market as a whole.
Total Crypto Market Cap, $CRYPTOCAP
As the monthly chart above reflects, the cryptocurrency market first surpassed $100B in value in August 2017. It then peaked at over $750B in value in January 2018. Subsequently, it underwent a tumultuous bear market, and is currently valued at just under $250B in total.
Taking a closer look at the chart, it’s clear that the $100B level has held as support. Despite trading below it during the bear cycle lows in December 2018, the crypto market managed to close above this value that month and in the months since then.
Looking ahead, the $500B level stands out as resistance; from a monthly close perspective, the crypto market only managed to finish above this value one time, in December 2017. Assuming it is surpassed and held in the years to come, the next resistance to watch is the $1T level.
One might ask why I’ve highlighted the $1T level. It’s simple, really. This is a psychological figure that, if breached, would capture media headlines worldwide, just as Apple did when it first hit this market cap in 2018. And it would pave the way for cryptocurrency as a whole to be considered a more serious asset class in the digital age we live in today. As it stands now, the cryptocurrency market is a drop in the bucket when compared to the over $26T held in the S&P500 alone.
In the future, if crypto bulls manage to exceed and hold the $1T value level, it may be safe to say at that point that this market is not going anywhere. Nevertheless, the question of long-term utility remains hotly contested, and even among its proponents, cryptocurrencies are not all held in equal esteem. Personally, I am still of the opinion that the bulk of the market value in the future will be captured by a handful of what will be considered the top digital assets, as I have written in the past.
If you haven’t been following the latest developments in the crypto market, I encourage you to do so with an open mind. There is much to be discovered, and reading about the various approaches to how different cryptocurrencies tackle topics such as decentralization, governance, immutability, monetary policy, and network security is a rabbit hole worth exploring, if for no other reason than to learn, and to continue growing.