Four years ago today, I set up a special crypto wallet and put $100 in Bitcoin in it. The rule was I could not add any funds to the wallet, but I could move and swap with any other coins within the wallet. It’s an Exodus “warm” wallet with well over 100 different coins, alt coins, tokens, and NFTs available. It also has a range of choices for “staking” and earning interest. As of the moment I’m writing this, the wallet has just over $760 in it.

Now, I’m not giving financial advice here. Zeus knows I can barely manage my own affairs, much less pretend to obtain a license from some farcical “authority” to do something that would otherwise be “illegal”. These are just my experiences from my own dabbling in affairs much larger than myself. Planned Chaos Ludwig von Mises Best Price: $1.99 Buy New $9.95 (as of 07:55 UTC - Details)

As the value of Bitcoin went up, I moved some of my ill-gotten gains into Ethereum (ETH). Later, I added Ripple (XRP), Hadera (HBAR), and most recently Dogecoin (DOGE). Again, I haven’t added any funds to the wallet. I just moved gains in one coin to buy into another. My result is a compound annual growth rate (CAGR) of 50.7%. All of the five coins and tokens I have doubled in value at least once since I bought in.

Maybe it’s just me, but that seems like an extraordinary result.

According to the Mystical Delphic Financial Sibyl (MDFS), if I had invested the same $100 in the Dow Jones Industrial Average (DJIA) during the same period, I would have earned a CAGR of 11.4%. If I expand the horizon to the year 2000, my CAGR drops to 6.7%.

Mrs. FarSide is more attracted to sparkly things than digital abstractions, so she has her little pile of gold bricks, for which she’s earned a 4-year CAGR of 3.6%, and a 24-year CAGR of 6.5%. Even the house we bought in 2011, has only brought in a CAGR of 3.1% in 13 years, based on valuations for comparable recently-sold houses in the neighborhood.

Meanwhile, the Indonesian rupiah has lost about 50% of its value to the US dollar in the last 17 years, so the cryptos have actually preserved my purchasing power better than other classical hard assets like gold and real estate, and the cryptos are more liquid.

So why did I decide to jump into cryptos, when smart, financially-savvy folks like Warren Buffett, Jamie Dimon, Janet Yellen, and Jerome Powell have all poo-pooed cryptos as a fad and a really bad idea?

For one thing, I don’t trust anyone with double letters in their names, and I certainly don’t trust grown men called “Jamie”.

For another thing, the best piece of advice I’ve ever received is from Mark Twain himself, “Whenever you find yourself on the side of the majority, it is time to pause and reflect.” It has never steered me wrong.

The best opportunities are where no one else is looking. That, and I’ve always figured the Big Guys will point me in the wrong direction, so they can load up first, which seems to be the case with the whales.

Since I first discovered the internet in the late 1980s, I’ve had the sneaking suspicion that everything was going digital. I didn’t know exactly how it would manifest, but there was no mistaking the power of digital networks, even with 8086 processors, dual floppy disks, 300 baud dial-up modems and monochrome screens.

The introduction of blockchain technology in 2008 by Satoshi Nakamoto (whoever or whatever that is), was a clear road sign to the future. Distributed cryptographic networks are unhackable, scalable, and trustless. They don’t require centralized authorities and the good ones are completely anonymous. The best part, and the highest recommendation anything can get in my book, is banksters and gummints hate them.

That appeals to my inner anarchist.

We are rapidly heading toward a fully digitized world, where everything will be tokenized and traded in vast decentralized markets. We will store our funds in our own electronic wallets (self-banking), and every transaction will be recorded forever on the distributed ledgers. Even our productivity and our physical selves will generate value on our personal blockchains.

If you buy an apple at the store, you will scan it and see where it was grown, what chemicals were applied to it, who or what picked it, what temperatures it was stored at, and when and how it was transported to the store.

If you buy a used car, you will access the car’s entire history — when and where it was built, the supply chain that went into it, every oil change, every repair, every fill-up, even the driving habits of all previous owners.

Your entire life history will follow you around like a bad smell — every drunken SocMed post, every test result in school, every summer job, your entire life’s earnings to date, every major life event, and every court filing against you.

The trade-off for all this brutal honesty is this current moment in time, when vast amounts of wealth are being transferred to early adopters who learn how to use the system. Even as we sit here chatting, Zoomers are racking up staggering personal wealth doing nothing but gaming the new system. They may not intellectualize it, but they instinctively know that the entire world (and beyond) is being tokenized, and if they are savvy, they can create generational wealth for the progeny they apparently aren’t creating. Popular Mechanics How ... Popular Mechanics Best Price: $6.87 Buy New $11.00 (as of 04:21 UTC - Details)

Remember the Dark Ages when domain names were just becoming a thing, and major corporations didn’t have a clue about the value of the internet? A few savvy individuals bought up names like cocacola.com and mcdonalds.com, and they cashed in when the companies decided they should probably get in on this web thingy. Suddenly there was a job title like “web master”. Imagine that kind of opportunity with exponentially greater returns.

Note that I am not making value judgements about the ongoing change in civilization as we know it. That’s your job. What i am saying is that when we chose to send our first email or post our first twix, we bought into a process that now has a life of its own. We all have a chance to make some serious wealth (I didn’t say money), because the values of cryptos now are peanuts compared to what they will be in five years.

The trick is that the value of cryptos are generally measured against the US dollar, like everything else. The US dollar is already a relic of a by-gone era. In five years, valuing anything against the dollar will likely be an anachronism.

I figure getting in early also gives me some tiny say in how all this rolls out. The technology is neutral — neither good nor evil. How it is used and who controls it will determine whether we are the master of, or the slave to it. We may not have any brakes at this point, but we still have a steering wheel.

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