MakeMoney
December 17, 2017
How I Made $1,600,000 in Bitcoin
When bitcoin was $500, (it‘s’ $19,800 as I write this ) a client called my offices and asked if he could hire me to speak at his conference in Las Vegas. My guy, Robert told him my fee was and he agreed to it with one caveat, he wanted to pay in Bitcoin.
Robert then brought the proposal to his manager who immediately and emphatically said, ‘NO.”
A few days later, Robert called me on a Friday night saying, “GC, a client is insisting you speak at his conference but he wants to pay you in bitcoin.” This was Friday night at 9pm and without knowing much about bitcoin, I told Robert, tell the client, “I look forward to speaking at his event and I will gladly accept bitcoin as payment.”
I hung up the phone knowing something special had just happened. This was my first experience with any cryptocurrency. I had heard about bitcoin thing and crypto currencies but I didn’t understand it. When you are running a business, or in my case five of them, and raising a family and doing life, you miss a lot of things. I was clueless on bitcoin and still today don’t fully mostly understand it.
What is interesting to me however is my understanding or lack of understanding is not much different than my understanding of stocks, bonds, derivatives, futures, ETFs , mutual funds, puts, stops, or for that fact, even how cash works.
So why would I accept the bitcoin without fully understanding it? I immediately agreed to accept the 100 bitcoins based on three philosophies that have never let me down:
1) Always say yes to the customer until you find out you can’t.
2) Commit first figure, the rest out later.
3) Accepting bitcoin is no different than any other form of payment. (More on that later.)
The way I worked this out in my mind was simple. A client wants my services and has a form of payment I don’t know anything about. The fact that I don’t understand the form of payment is not his problem, it’s mine. Would I take worthless pieces of paper (cash)? We do it everyday. Who knows what a dollar is really worth anyway. Would I take a contract or promise to pay in the future (debt)? I have millions of dollars in contracts with companies who promise to pay me in the future. Would I take shares of stock in a company in exchange for services rendered? Yes, I have and yes I will in the future.
So literally without fully understanding the currency, I used simple logic to make my decision. Do I want the customer? Yes. Am I willing to accept a payment I don’t yet understand? I do this everyday and so do you.
I remember when I set up my first Paypal account to accept money and didn’t understand it. Now we accept it everyday. Decades ago, I remember my first merchant accounts with AMEX and VISA, so I could take credit cards.
So while everyone else is becoming an expert doing due diligence on crypto currencies, bitcoin, litecoin, etherium and the other thirteen hundred new currencies, I was busy creating an account so I could accepted the 100 bitcoins into my new bitcoin account.
We booked the trip, I figured the cost of flying to the Vegas event and told my accounting department, “sell enough of that ‘bitcoin stuff’ to cover the cost of the trip and keep the rest.” We created a bitcoin wallet where 80 coins still sits today worth almost $1.6M.
The moral of the story is too much due diligence can make your ignorant. Keep it simple, figure out how to say yes. Let’s face it, every form of currency you accept today is only worth what we all agree it is worth. My eight year old daughter asked me yesterday, “Papa how can money, which is simply a piece of paper, be worth anything? ”
The only reason $100 bill is worth a hundred dollars is because we all agree it does. The reality is it is worthless. The same thing with any form of currency or stock, bond, or mutual fund.
What is bitcoin worth? It is worth whatever you and I decide it is worth. And today it is worth almost $20,000 per bitcoin.
Everyone wants to know, “how high will it go?” “Which crypto survives?” “Which crypto should I invest in?” “Is it a bubble?” This is what I know, it is best not to complicate or speculate. Simplify what this is.
Whether you accept dollar, rubles, pesos, pounds or yen there are only pieces of paper. There value is an agreed upon one. In most cases that paper is converted to digits, which you pay the bank to secure. Stocks, ETF’s, mutual funds, bonds and the like are pieces of paper that Wall Street manufactures. They set a suggested value for each one and then allow the market through trading to decide what each share is worth.
I love the idea of a currency with a perfect ledger and no middle man. I hate banks and I hate Wall Street even more. You see a bank on almost every street corner in America sitting there creating an image of self-importance and stability. They hold your money, pay you nothing for doing so and when you need to withdraw your money it they charge you to take it out.
Then there is the Wall Street casino manufacturing every form of scheme and game to sell imaginable; bonds, stocks, etc’s, mutual funds, 401k’s, derivatives and on and on. It’s all so complicated the banks won’t even lend money on their own stock and the average investor is encouraged to diversify or invest in to spread the risk across many stocks to reduce exposure to loss (another scheme to benefit the brokers.)
This will be and should be disrupted. You and I, deserve a secure place to store our money, property, ideas, trademarks, or anything of value without being held hostage by some middle-man ‘capitalist’ who did nothing to create it or add value.
I can’t tell you which crypto makes it or how high they will go or which one is best, but I do believe crypto currency solves a problem of such tremendous magnitude that the upside is almost hard to think with.
I look forward to your comments.
Grant Cardone,
CardoneCapital.com
