Wall Street watched Coinbase rake in $456 million in profits in 2018.
Binance wasn’t far behind, with 2018 profits of $446 million.
Meanwhile, Deutsche Bank, one of Germany’s flagship banks, made just $315 million that year.
You might not know it if you watch the mainstream news… but crypto firms are outperforming some of the biggest banks in the world.
And Wall Street is taking notice…
Now, it’s salivating to get its hands on these profits. And frankly, it doesn’t have a choice.
So today, I’ll tell you why this is a key driver for crypto prices in 2020 – and more importantly, why you shouldn’t let bitcoin’s short-term volatility keep you from focusing on the big picture…
A New Crypto Product
Recently, I had the pleasure of sitting down with Daily editor Teeka Tiwari during his recent crypto webinar.
That’s when Teeka revealed his top five coins to take advantage of this fundamental driver. He also revealed two bonus picks.
Of course, they’re for subscribers only.
However, I can share one of his key insights from the event with you. Talking about this new fundamental demand for crypto, Teeka said:
[There will be] a massive increase in demand due to the presence of Wall Street and the securitization of crypto assets into products that it can then sell to its customers.
SPDR Gold Shares (GLD) is a good example of the type of security Teeka mentioned. GLD’s underlying asset is gold. So the exchange-traded fund (ETF) tracks the price of physical gold.
Now, GLD made it easier for people to buy gold. They no longer had to own physical bars. Instead, they could just by the ETF, which represents a portion of physical gold. Today, it has $42 billion in net asset value.
So just like with gold, Wall Street will create products making it easier for investors to buy crypto assets. And it makes a lot of sense since there’s a lot of money to be made…
In Search of Profits
A few years ago, no one would’ve predicted that up-and-coming crypto firms like Coinbase and Binance would make more money than Wall Street stalwarts like Deutsche Bank.
But it’s happening… Wall Street sees it happening… And now, it wants a piece of the pie, too.
Teeka explained why in his webinar:
Wall Street is greedy, and Wall Street’s current fee structure is shrinking like a snowman in summer.
Just this year, the amount of money in passive funds surpassed the amount of money in active funds.
It’s the first time this has ever happened in history. And it’s significant. You see, passive funds have very low to zero fees… while actively managed funds can have fees up to 4%.
That’s a huge difference. And Wall Street will need to make up for it somewhere.
It’s why we just saw Charles Schwab announce that it’s buying TD Ameritrade for $26 billion.
Analysts are suggesting Schwab is doing this for scale and synergies. That’s a fancy way of saying it’s trying to get bigger while cutting costs.
But we think there’s another reason it’s going after TD Ameritrade: its crypto offerings.
TD Ameritrade already offers bitcoin future options. And it invested in ErisX, which aims to be a Bakkt-like platform for institutions to invest in and trade digital currencies.
So this move by Schwab just confirms crypto is Wall Street’s new breadwinner.
But this wasn’t a surprise to subscribers of our Palm Beach Confidential crypto service. As Teeka said in the webinar:
That’s where Wall Street comes in. When Wall Street goes into a new market – and I’ve seen it do this with foreign currencies and foreign stocks – it makes it easier. And then, it charges a fee to do so.
In short, Wall Street is moving into crypto in a big way.
A Banner Year Ahead for Crypto Products
Teeka’s prediction is already happening… and starting to accelerate.
Citigroup, for example, is developing a crypto investment product it calls a “digital asset receipt.” It’s similar to an American depositary receipt (ADR) for foreign stocks.
And the SIX Swiss Exchange just launched its first income-generating crypto exchange-traded product (ETP). It’s the eighth crypto product launched on the exchange.
What’s significant is, the ETP has an annual management fee of 2.5%. That’s a lot juicier than the 0.04% you might get on a passive index fund.
But not all of Wall Street is directly creating new products. Some are choosing to invest in up-and-coming fintech firms.
For instance, Santander InnoVentures, Mitsubishi UFJ Financial Group, and Nomura Holdings invested in a platform called Securitize.
Securitize provides a solution for issuing and managing digital securities (security tokens). And it’s already issued a handful of assets.
Plus, we’re also seeing firms ready to bring crypto ETFs to the market.
One example is that the U.S. Securities and Exchange Commission (SEC) recently announced it’s taking a second look at the bitcoin ETF proposed by Bitwise Asset Management.
Bottom line: Ignore the day-to-day noise and focus on the big picture… the Wall Street money-making machine is coming to crypto.
Follow the Smart Money
It’s clear Wall Street is coming for crypto. And it wouldn’t do so if it didn’t think there was a lot of money coming into the space.
Back to Teeka…
Wall Street people – love them or hate them – are the smartest moneymakers on the planet.
So how do we profit from these smart moneymakers?
Well, the easiest way is to buy some bitcoin, the de facto currency of the crypto ecosystem. When Wall Street firms start entering this space en masse, bitcoin will be the first crypto they buy.
But remember, you don’t need to bet the farm. A small stake is all you need to make life-changing gains.
Analyst, Palm Beach Daily
P.S. As we’ve mentioned before, Wall Street’s greed will push crypto prices to new highs. And you can see that they’re flocking into the space just as we said they would.
Now, Teeka has found five tiny cryptos (some trading for as little as just a few cents) that could soar so high, they could potentially help you turn $500 into $5 million in as little as 300 days.
He revealed them in his recent webinar. And now, you can get in on them, too. In fact, there’s a rare event coming around the corner that’ll send bitcoin – and other altcoins – soaring even higher. So the time to get in is now… and you can learn how right here.