Nick’s Note: 2018 is shaping up to be the year that cryptocurrencies evolve into more than just digital money. In today’s interview, Palm Beach Confidential editor and crypto expert Teeka Tiwari says we’ll see cryptocurrencies split into two types of coins…

Nick: T, last week you told me that virtual reality and artificial intelligence were the two most exciting trends you saw at the Consumer Electronics Show (CES). Does that mean interest in cryptocurrencies is fading?

Teeka: Of course, not. In fact, interest in cryptos and blockchain technology is absolutely exploding. It’s crazy how the tides have turned.

Here’s what I mean…

Last year, CES had only one presentation related to the blockchain. And it was in some dark, dingy corner of the expo center. It was stuck in the smallest room they could find. And that room was three-quarters empty.

I remember thinking to myself that next year this room will be jam-packed.

And it was. Except this year, there were more blockchain presentations than I could go to. These presentations were so popular that they got moved to the biggest ballrooms in Vegas… and it was standing room only.

Nick: I’m sure those huge gains in cryptocurrencies last year had something to do with that. What will be the biggest trend in the blockchain space in 2018?

Teeka: First, let me back up.

For those not familiar with the blockchain, it’s a distributed network. That’s just a fancy way to say it’s a decentralized public ledger. You can think of it as a second-generation internet.

Cryptocurrencies are the medium of exchange on the blockchain. Some are like money. Others you can use to trade assets or invest in blockchain companies.

Now, one big trend we’re going to see really soon is the separation of cryptocurrencies into two kinds of coins. We’ll see “security tokens” and “utility tokens.”

Security tokens are similar to stocks… but they don’t always give you ownership the way a typical stock like Apple or Walmart will. You might be buying into an income stream, a profit share, or a royalty.

Since there’s a future expectation of gain, they are considered “securities.” These tokens will be tradable just like stocks, and the Securities and Exchange Commission (SEC) will provide oversight of them.

You’ll be able to buy security tokens on regular exchanges soon.

Utility tokens are different. They’re used to buy services on a specific blockchain platform. For instance, ether is the utility token used to buy computational power on the Ethereum network.

Nick: So, these two types of tokens are different. One is used to buy equity in a blockchain company or participate in profits. And the other is needed to use a blockchain company’s services. How do you value them?

Teeka: That’s tough to say. Security tokens aren’t exactly like traditional stocks. This is a brand-new field of research. Many of them will be early-stage start-ups with little more than a good idea and an energetic team behind them.

So, we’re going to look at these investments like a venture capital (VC) firm would.

Before a VC firm invests in a single company, it makes sure there’s a big market for the product… and that the product will be readily accepted by the market.

Then it looks at management to make sure a solid team is in place, and that they have a plan to bring the product to market.

Finally, the firm wants to know what the start-up will be doing with its money.

Utility tokens will be a little different. Our analysis of utility tokens is driven by gauging how quickly they can gain adoption in the market.

Nick: T, thanks for sharing.

Nick’s Note: We’re about to see a huge influx of cash into the crypto markets in 2018. Potentially trillions of dollars from some of the biggest players in the world: big banks, pensions, hedge funds, and trillion-dollar asset managers.

Teeka has put together a report that will give you all the details on how to play this trend. It’s called The Cryptocurrency Action Plan: Your Guide to Making a Fortune in 2018. The report contains three specific cryptos that could soar 20 times or higher by April 2. Learn how to get your copy right here


Here Come the Institutions: Last week, the CEO of one crypto exchange recently told Bloomberg that the platform has gained “a lot of interest from institutional investors.” This is big news. It means we could be on the cusp of a big rally. You see, institutional investors are much more discerning than retail investors. So, it stands to reason that they’ll be investing in quality cryptos. Now that institutional money is headed into this space, we can see quality tokens soar in price.

Crypto Mining Headed to Canada: There’s been a lot of concern lately about China cracking down on cryptocurrency mining. (Miners keep the various blockchains operational.) But because mining is “decentralized,” we’ll just see them head to another jurisdiction. And that’s happening already.

According to Reuters, 30 large crypto mining outfits are looking to move their operations to the Canadian provinces of Quebec and Manitoba. The provinces have large and cheap energy supplies necessary for crypto mining. So if China does ban mining, expect North America to benefit. This is a trend that governments can’t stop.

Cash for Dummies: “If you’re holding cash, you’re going to feel pretty stupid.” That’s the word from hedge fund guru Ray Dalio. He made the remarks last week at the World Economic Forum in Davos. Dalio says the current bull market is in a “Goldilocks period… Inflation isn’t a problem. Growth is good, everything is pretty good with a big jolt of stimulation coming from changes in tax laws.”

To regular readers, those words sound familiar. In the January 25 Daily, we told you “the economy is getting stronger… unemployment is near record lows… and people are feeling as confident as ever.” Our advice remains the same: Stay in the stock market.


From Claire T.: My crypto volatility plan: Hold and set limits to buy on the dips.

From Gord P.: Hi Nick. Just writing to let you know how much I enjoy your essays. Your writing is like a breath of fresh air, mate. They’re straightforward, easy to read, and you seem to have the knack of hitting all the main points when explaining your subject matter. Keep up the great work.


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