Before there was blockchain, there was this…

Monday, 27 November 2017
Melbourne, Australia
By Bernd Struben

  • The 21st Century’s incorruptible cashier
  • Pass the pixie dust please
  • Revolutionising the property industry

Have you heard of James Ritty?

Admittedly, his name had slipped off my radar as well. Until I was flipping back through A History of the Republic over the weekend.

The book is put together like a textbook. But it’s an easy read and offers some great insights into US history.

Like James Ritty, who it turns out has much in common with Satoshi Nakamoto.

Now you’ve probably heard of Satoshi Nakamoto. That’s the person, or more likely group of people, who designed bitcoin. Importantly, they also developed the world’s first blockchain in 2009.

130 years earlier, in 1879, Ritty patented an equally ground-breaking technology. He, too, was driven by the unmet needs of his times.

Ritty owned a successful café in Dayton, Ohio in the 1870s. Yet, despite a steady flow of customers, profits were thin. Ritty suspected his employees were dipping into the cash box. But he had no way of proving it.

You see, at that time, merchants couldn’t reliably track their sales and profits. Clerks made change from an open cash box. At best, the transactions were jotted down in a ledger. But this was open to all sorts of inaccuracy and dishonesty.

One day, on a trip to Europe, Ritty visited the ship’s engine room. And he took note of a machine that recorded each revolution of the propeller. When he returned to the US he developed a simple cash register based on those observations.

In 1879 he patented the first model. Over the next few years the cash register was improved so the amount of the purchase showed to both the customer and the clerk. This transparency led to far greater honesty among the staff.

His cash registers were also soon fitted with paper rolls, which recorded every transaction in an unbreakable, transparent chain. (Of course, you could tear the roll, but that was hard to hide!)

The result?

Profits at his café soared. Ritty was so impressed he called his invention ‘the incorruptible cashier’.

Which brings us back to blockchain.

More, after the markets.

Markets

Over the weekend, the Dow Jones Industrial Average closed up 31.81 points, or 0.14%.

The S&P 500 gained 5.34 points, or 0.21%.

In Europe, the Euro Stoxx 50 index finished up 9.16 points, or 0.26%. Meanwhile, the FTSE 100 dropped 0.10%, and Germany’s DAX rose 51.29 points, or 0.39%.

In Asian markets, Japan’s Nikkei 225 index is down 63.23 points, or 0.28%. And China’s CSI 300 is down 1.31%.

In Australia, the S&P/ASX 200 is up 2.25 points, or 0.04%.

On the commodities markets, West Texas Intermediate crude oil is US$58.86 per barrel. Brent crude is US$63.79 per barrel.

Gold is trading for US$1,288.05 (AU$1,692.13) per troy ounce. Silver is US$17.05 (AU$22.40) per troy ounce.

One bitcoin is worth US$9,674.87.

The Aussie dollar is worth 76.12 US cents.

The 21st Century’s incorruptible cashier

You never know when a simple — or not so simple — invention is going to rock the world.

We don’t normally think of cash registers as ground breaking. Mostly because they’ve been around for 150 years. But they had a huge impact on modern merchandising methods.

As noted in A History of the Republic:

As the cash register gained popularity, merchants became more conscious of statistics. Business people developed more complex methods of accounting, figuring inventories, and calculating profits and losses.’

When bitcoin first hit the scenes in 2009, few, if any, grasped the phenomenal impact that blockchain would eventually have on established institutions across the world. An impact that continues to grow almost exponentially by the day.

Blockchain, as you likely know, is the distributed ledger technology behind bitcoin and every other cryptocurrency. But this ‘incorruptible ledger’ has far more applications than enabling secure crypto transactions.

That’s why it’s a core ingredient behind crypto guru, Ryan Dinse’s small-cap advisory service, Exponential Stock Investor.

Big data is an area where Ryan sees some of the greatest profit potential for pioneering small-caps embracing blockchain technology.

The world, after all, creates and stores more data every single day now than we did throughout the entire 19th Century. And whoever owns and controls that data stands to make a fortune.

Here’s what Ryan wrote to his subscribers last week:

What if contracts could automatically self-execute when certain characteristics are met?

This powerful idea is the basis of smart contracts, and one of the most exciting features of blockchain technology.

Ethereum is the leading smart contracts-based cryptocurrency.

It’s got the potential to be the most revolutionary part of blockchain technology.

If you can code it, you can turn it into a smart contract.

This doesn’t just create more efficient ways of doing existing transactions. It also creates whole new concepts around what ownership and control of data actually means.’

Convinced by the mammoth opportunities being thrown up by blockchain, Ryan launched Exponential Stock Investor on 24 October this year.

Since then he’s made four recommendations. (Two others remain on the watch list, as they leapt over his recommended buy price before he could get his report to his readers.)

Of those four recommendations, his worst performer is down 1.2%.

The best performer dwarfs that tiny loss. It’s already gained 146%…and that’s in just one month. And Ryan is convinced this is only the beginning of a meteoric share price rise for this small-cap Aussie stock.

Ryan has his eye on a number of small Aussie companies making use of blockchain to give themselves a huge advantage in the markets. And every month he delivers the best of these to his readers.

Details here.

Pass the pixie dust please

While on the topic of blockchain, the following headline caught my eye on Bloomberg: ‘Blockchain Is the Latest Pixie Dust for Stocks’. The article continues:

A market truism for our time is that whenever a company touches anything related to blockchain — or claims to — its stock shoots up, sometimes even before it enters the industry. The latest example? Riot Blockchain Inc., formerly known as Bioptix Inc.

The former maker of diagnostic machinery for the biotech industry (a penny stock with three reverse splits in five years) now invests in cryptocurrency-related businesses, leading its stock to more than double just since Nov. 16, when it bought a minority stake in audit and accounting firm Verady LLC. That merely added to gains since renaming itself and buying a stake in blockchain-based payments provider Tess Inc. in October…

Another example is 360 Blockchain Inc., a private equity firm formerly known as 360 Capital Financial that changed its name last month, saying it plans to focus its investments on blockchain-related companies. That drove its stock up 300 percent.

And the list goes on. Overstock.com Inc. soared after announcing the launch of a Securities and Exchange Commission-compliant digital tokens exchange. Goldmoney Inc. jumped after saying it will offer its clients the ability to trade bitcoin and ether and store the assets in auditable and insured vaults.’

Gains of 300%…or more. Simply from adding a little blockchain pixie dust.

If you’re more of a visual person, have a look at the graph below. It shows you the gains made by 360 Blockchain (white line), Overstock (blue line) and Goldmoney (purple line):



chart image

Source: Bloomberg
Click to enlarge


As you can see, all of these stocks’ share price gains were made since August. And with blockchain technology continuing to encroach on almost every sector in the world, this looks to just be the beginning.

You can discover Ryan’s favourite ways to play this fast-evolving megatrend here.

Revolutionising the property industry

Banks and other financial institutions were some of the first to feel the early influence of blockchain.

But the property industry is not far behind.

In the latest move, a house in Melbourne may become Australia’s first property to be sold (in part) for bitcoin.

From Domain:

A vendor selling a family house in Melbourne’s outer east is willing to accept Bitcoin as payment, in what could be the first cryptocurrency property transaction in Australia. 

As digital currencies become more mainstream, they are poised to penetrate the real estate industry in Australia and abroad, raising questions about logistics and legalities.

One issue, of course, is bitcoin’s volatility. The crypto has already suffered losses of up to 25% on two occasions in the past six months. Only to come roaring back to new records shortly thereafter.

In the case of the Melbourne property offered for sale in bitcoin, the owner, Rob, says that he’s aware of the risks involved. As quoted by Domain, Rob stated:

“The way it would be is if someone was going to offer $10,000 in Bitcoin, then that would be $10,000 in Bitcoin whenever they pay that. So if the market goes up or down or drops, that’s it.

“A day in Bitcoin is like a week or a month in the real world. It’s volatile and in volatility, there’s a lot of money to be made and a lot of money to be lost.”

Hats off to a true entrepreneur.

Rob is spot on when he says a day in bitcoin is like a month in ‘the real world’. And he made that statement before bitcoin surged to a massive new record today.

As at writing one bitcoin is worth US$9,674.87 (AU$12,710.02). That’s up almost AU$1,300 since midnight last night.

This is exactly the kind of volatility that keeps Ryan Dinse awake at night.

Not because Ryan is worried about the price of bitcoin, ethereum or the other core cryptos plunging or surging. But because he’s meticulously testing his new system. One designed to take advantage of these types of price moves.

It all has to do with a brand new project Ryan’s been working away on behind the scenes. A project he’s convinced will enable crypto investors to dwarf the gains made by the dusty, old ‘buy and hold’ strategy. Which, after all, would ‘only’ have returned you 869.8% on bitcoin year-to-date.

That’s all I can tell you today. Be sure to tune in tomorrow for more details.

Cheers,
Bernd