I posed ten questions to a $600 million money manager about crypto prices, 5G investments and fog computing – here are his answers in full

Last week I showed how three of the most exciting, and potentially lucrative, areas in tech today – blockchain, 5G and fog computing – are incredibly interlinked.

This was after reading about them in the April issue of Eoin Treacy’s Frontier Tech Investor.

In that issue Eoin showed the hidden relationships between these three key technologies and how one easy investment could help you make money from all of them.

I thought the ideas Eoin brought up in that issue were worth exploring.

I mean, these three technologies will go on to define how we live and work in the coming years.

So I asked if I could follow up with ten questions to Eoin about these technologies and how they will impact our lives, so that we can all get a better understanding of them.

That’s what you’ll find below. I hope you find it as useful as I did.

Well, they already are, to be fair. If you want to find out what those opportunities are, and how to invest in them, get your trial to Frontier Tech Investor – and your free tech investment book – here.

Now before I go, I just wanted to make sure you’ve got your name down for Nick and Boaz’s banking crisis event tomorrow afternoon.

As you’ve probably heard, they have uncovered a “bank crushing” anomaly that the institutions are unwilling to publically acknowledge, or even talk about.

Nick and Boaz believe it’s their duty to make as many investors aware of this situation as possible. And that’s why they’re holding this event.

Because of this, it’s completely free to watch – so long as your get your name down here before it all kicks off tomorrow.

1. What do you make of the crypto market moves over the last few weeks, could this really be the start of a recovery, or is there something else going on here?

A decline of 83% from peak to trough is enough to get anyone interested. However, in order to get a change of trend you need a catalyst. We got that when the Cboe announced it was going to remove the bitcoin futures from the market. In one fell swoop that is removing a lot of the leverage that has been affecting the market.

If you remember back in November and December 2017 there was a lot of speculation going on about the quantity of money that was going to hit the market once futures started trading. What people didn’t account for was that most of the interest in the future was as a means of hedging long exposure. A large short position built up and that crashed the market.

That’s exactly what happened during the 1987 crash. The introduction of index futures for the S&P 500 had led to the belief that they could be used as “portfolio insurance”. When the market pulled back in October 1987 everyone went short the future at the same time and crashed the market.

That event did not mean the end of the stockmarket and the crypto crash of 2018 isn’t the end of blockchain either.

2. From a trader’s perspective, are there any specific numbers, patterns or time frames we should be looking at when it comes to the crypto market?

The only reason I have had success with calling tops and bottoms in bitcoin is because of my understanding of crowd psychology and technical analysis. Subscribers to my Trigger Point Trader service will be familiar with how ranges are explosions waiting to happen. The longer a price goes sideways for, the more potential energy is being built up, like a coiled spring, so that when the breakout comes it is both powerful and surprising to the majority of people.

Once you get the breakout, which has just happened in bitcoin and many of the altcoin markets, you get people expressing interest, but they are also wary that the move has already gone too far for them to buy now. That means we are likely to now see a range form. I refer to this as the first step above the base and it should form somewhere between $4,000 and $5,500. It could last for months but when it is eventually resolved on the upside, we will have clear evidence of a new uptrend.

Provided this goes back to a cash only rather than a leveraged market, it will be important to pay particular attention to logarithmic scale charts. Unleveraged investors are more interested in percentage moves than points so assessing the market from a percentage gain perspective gives us valuable insight into what people are thinking and how they are deploying their capital.

3. Do you think most people realise just how interlinked 5G, cloud computing and crypto are?

I don’t think the majority of people have any conception of how big the 5G opportunity is, not to mind cloud and more recently fog computing. With regard to crypto they represent the potential enabler for the growth of the sector out of the proverbial garage and into the mainstream.

Computing goes through long-term 20-year cycles of mainframe to distributed patterns. Cloud computing today is the mainframe of our era. Fog computing and the blockchain are the distributed computing of tomorrow.

4. How long do you think it will take before 5G is ubiquitous, and will this give a boost to mobile phone manufacturers whose sales have been levelling off?

5G will be up and running this year. It’ll be ubiquitous by the end of 2020 or the middle of 2021. It’s a big excuse for upgrade your phone and to sign up for a new plan so manufacturers, carriers and app developers all have an incentive to make it work. That has to happen soon because as you highlight sales are levelling off.

5. Broadband brought us completely new business models, like streaming video, music and new computer games. Do you think we will see more entirely new industries launch on the back of 5G?

Absolutely. VR is likely to be an early one. It’s going to be quickly become untethered. That means it will move out of the office and sitting room and into a more mobile-friendly environment.

5G is an enabling technology so things that were not possible before suddenly are. 5G is a basic ingredient for autonomous driving, traffic management and potentially even hive communication for cars.

5G will make the video streaming sector completely seamless. You already see that Google, Amazon and Apple are launching streaming gaming services. Lag is a significant issue with online games today but that disappears with 5G, which is why they are building out their product bases today.

6. How do you think traditional phone and broadband companies will cope with competition from 5G?

The primary purveyors of 5G are exactly the same people who sold us 4G so this is a similar but larger business opportunity for them.

7. Will fog computing make a big difference to the end user, or is it more of a backend development?

It’s a backend development that will smoothen out the network but it’s an interesting investment case because it means there will need to be a lot more processing power in the local area networks and even on the phones in our hands. One thing we are already seeing is that companies like Google are handing back a good deal of the processing power to the native system with carry around with us. It’s just more efficient but that is a clear sign that we are on the cusp of a much more distributed business model which feeds right into the evolution of blockchain business models.

8. Will fog computing mean that ordinary people will be able to make money renting out their spare computer power, or will our devices simply start doing extra work in the background without us realising?

I think it is probably going to be the latter. Any nice idea where people can think they have a chance to make a little extra money is quickly co-opted by corporations and turned into a cash flow to feed quarterly earnings.

9. Given the trend towards decentralisation in tech, do you think this will also lead to more decentralised workplaces – ie, more remote working?

I haven’t worked in an office since 2007 so I guess I have to say yes. The workplace will always be important to some people for whom personal contact and socialisation are important. However, it is unlikely that the cost of living in major urban centres is going to fall very much, and that will create a pull for some people to move away from the city. There is one thing for certain and that is it will be easier than ever to work remotely.

10. Do you see our ever-increasing reliance on cloud storage and cloud computing as an area of concern or an area of opportunity?

My grandmother had an expression: “Never write anything down, you never know who will read it.” My daughter encapsulated that phrase last night for me with the quip, “Don’t type anything you wouldn’t like to see later as a screenshot.”

I’d be lying if I said I am not concerned with the quantity of data about me that is sitting on servers all over the world. My credit card information has been hacked at least seven times since I moved to the US. That is through no fault of my own but because businesses have been hacked and they were storing my details.

What I am more concerned with, however, is how I am being psychologically profiled by companies like Google and Amazon, I don’t use Facebook but it is the world leader in breaking down demographics into groups that can be marketed to. This is important in today’s world because of the rampant growth of censorship. I don’t like the fact that people with views quite alien to my own are controlling what does and does not appear on the internet. That is a problem which I believe is only going to get worse unfortunately.

Okay, that got a little dark right at the end there.

But other than that I think it’s clear that these three technologies are going to create immense opportunities for investors. And hopefully enhance our lives in the process.

Until then,

Harry Hamburg
Editor, Exponential Investor

Category: Cryptocurrency

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