Don’t turn your back on blockchain stocks

Blockchain is rewiring commerce and rewiring business, from the back office to the front office.”

— Scott Likens, PricewaterhouseCoopers

Cryptocurrencies have gotten clobbered so far in 2018, after their fantastic run-up last year. As a result, a lot of investors are turning their backs on any and everything crypto-related.


I think it is a huge mistake to turn your back on blockchain, the technology that underlies cryptocurrencies such as Bitcoin and Ethereum. While it’s true that 2018 hasn’t been a blockbuster year for cryptos like 2017 was, blockchain investments have been creating millionaires by the wheelbarrow.

And there’s a whole lot more money where that came from!

PricewaterhouseCoopers (PwC), one of the “Big Four” accounting firms, works with many of the largest businesses in the world. It recently reported that many of its customers are spending BIG money on blockchain initiatives, and that blockchain spending should only keep growing.

According to PwC, the demand for services related to blockchain advisory is “really, really, really strong,” and businesses from “every sector” of the economy are making big blockchain plans.

How strong? About $1.7 billion worth … just this year!

The biggest blockchain spender is the financial services industry. That’s because blockchain promises greater efficiency, error reductions, and cost-cutting benefits from automation and streamlining back-office processes.

Blockchain is especially useful in global transactions. For example:

  • A manufacturer in one country might get a purchase order and then take that order to a bank to get a loan.
  • Meanwhile the buyer in a different country obtains a Letter of Credit, or LOC, to guarantee the payments.
  • And then another bank can convert the payments into a common currency.

That all sounds pretty good to companies that do business all over the world … and they’re starting to invest big money in it.

How big? A survey from consulting firm Greenwich Associates shows that annual spending by financial services firms on blockchain rose 70% this year to $1.7 billion.

That’s what they’re spending collectively. On an individual basis, most firms have spent less $500,000 on blockchain. However, a good 11% of the survey’s respondents have spent more than $10 million.

Why is blockchain a budget item that isn’t going away anytime soon? That’s because this technology “reduces errors and streamlines operations because everyone is looking at the same numbers,” said Richard Johnson of Greenwich Associates.

With that kind of speed and accuracy, more companies are going to be allocating even bigger bucks to blockchain in the next few years. International Data Corporation expects annual blockchain spending to reach almost $12 billion by 2022.

Whenever you see “billions” of dollars being tossed around, there are opportunities for somebody to make a mountain of money. And that “someone” could be you if you invest in the right blockchain stocks.

The first stock that I recommended in our Weiss Crypto Investor newsletter has skyrocketed by more than 35% in just three months. And I expect it to go up by another 200% to 500%.

Of course, nothing in the investment business is guaranteed. But I believe that blockchain is the most exciting, highest-profit-power technology since Microsoft’s MS-DOS, and investing in the blockchain innovators will pay off in spades.

Don’t mistake my enthusiasm for blockchain as a knock against cryptocurrencies. You can invest in both (and should). But most investors have turned their back on anything related to cryptocurrencies, including blockchain-related stocks. And with all the profit opportunities that are staring us right in the face — sooner rather than later — that’s just a bad move.

Best wishes,

About the Technology Analyst

Even in the worst years for stocks, Tony was twice named “Portfolio Manager of the Year” by Thomson Financial. He was one of the first to introduce computer software for trading stocks. And in the early 2000s, he wrote “The Supernet,” providing a vision of the future internet that was far ahead of its time.

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