Bitcoin And Infinite Banking? Leveraging An Opportunity To Rethink Our Thinking?

The ability to rethink our thinking is a powerful tool if we can get past what we think we know to be true. There has been a lot of noise in the financial markets for the past year or so. The stock market just keeps going up. Precious metals are rising due to inflation concerns and real estate outside of major cities is rising at percentage levels not seen since pre-2008. As the world was watching and waiting to see what would happen in the US presidential election, Bitcoin made the move above $12K on October 20th and started a bull market that makes the 2017 bull market run seem small. As of this story it sits above $40K. No one knows where it will go from here but one thing is certain. Bitcoin stole the show at the end of 2020 and has not let go.

The entertainment level in finance is at an all time high. The participants identify with some of the groups listed here:

1. Bitcoiners
2. Gold Bugs
3. Robinhood Traders
4. Don’t Fight The Fed Stock Market Crowd

I’m not going to list IBC as one because quite frankly the majority of the US population thinks whole life insurance is a scam and believe Dave Ramsey is an all knowing financial guru.

Instead I’m going to make a case for the Bitcoin & IBC believers to think about why they got into Bitcoin or IBC.

In Satoshi Nakamoto’s Bitcoin whitepaper it is evident that control of the movement of value flows though financial institutions. In Nelson Nash’s book Becoming Your Own Banker it is evident that the sticking point is the flow and storage of value is controlled by financial institutions.

If I asked a Bitcoiner and an IBC policy owner how they feel about the Federal Reserve the answers would most assuredly be similar in nature.

Now the Crypto concept I am going to talk about will have some Bitcoiners shaking their head no but I’ll push on (hard core Bitcoiners often hold onto not your keys not your coins). You can read about that here:

Not Your Keys, Not Your Bitcoin — Lesson About Security

The concept of DEFI (Decentralized Finance) unlocks the “potential” to become your own banker.

You can read about DEFI here:

An introduction to Decentralized Finances (DeFi)

I am not going to get into the weeds of DEFI or Infinite Banking. Instead I’m going to lay out some objectives and the reader can come to their own conclusions.

Asset Leverage

The ability to be able to borrow against an asset is form of financial leverage. The number one asset everyone is aware of is real estate. The cash value of a whole life insurance policy is another ( If you follow Dave Ramsey do your own homework, you do not borrow your own money, you leverage your cash value). There are others I’m sure but the latest one is DEFI. Now for folks living in the United States this is not mainstream or as of yet very favorable. If you are outside of the United States in a Crypto friendly county your experience is going to be easier and the early adopter opportunity is just in it’s infancy.

Now for the readers in the Unites States the companies that lend to US residents are not offering attractive terms (LTV & Interest Rate). Outside the US, I have seen interest rates as low at .75% to stake 25% (LTV) of your Crypto.

DEFI is in the early adopters phase. Your Mom is not going to buy Bitcoin on Coinbase and transfer it over to the Celsius Network to earn 6%. But one day she may do that with a Fidelity or the like, if they figure out the easy button option.

This really comes down to multiple options for asset leverage. Would you like to have the following:

1. The ability to have a 30 year mortgage on your house at a fixed interest rate of 2.70% with no escrow and PMI?
2. The ability to grow an Infinite Banking Policy with cash values growing everyday and you can leverage it as you see fit and pay it back on your terms?
3. A growing amount of Bitcoin that one day you will be able to leverage as a financial asset?
4. The ability to pay off #1 using #2 or #3 if you wanted to do so or needed to?

I hope this makes you think. Improving our financial efficiency and options available to us, has a compounding impact that can enhance your life and the lives of your family. All it requires is an open and curious mind.

Have a great day.