#123: Helping Accredited Investors Confidently Invest into Cryptocurrency

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Welcome back to another episode of the richer geek. We’re happy to have Jeff Sekinger. He’s a seasoned CryptoCurrency Hedge Fund manager who is passionate about helping investors invest confidently into Blockchain Technology and Cryptocurrency. Jeff serves as the CIO for Boron Capital’s Digital Large Cap Cryptocurrency investment fund. He and his partners have created triple digit returns and consistently outpaced Bitcoin. Jeff also leads a private inner circle mastermind that helps educate over 1000 investors on how to navigate the crypto markets. Today I am excited to pick his brain and hopefully give you the insider track on how to successfully produce strong returns in cryptocurrency investments.

In this episode, we’re discussing…

[2:18] How is he now into Blockchain Technology and Crypos after he started his career as an asset management for Chase Bank, JP Morgan

[5:05] We know cryptocurrencies are a digital currency but as well an asset and how is not just an asset

[12:48] What does really means mining a Bitcoin

[16:37] Blockchain scenario to understand how Bitcoin works

[18:35] Since there’s no regulation, if is it going to be oversaturated with everyone making their own type of coin

[21:12] What would happen or what kind of inflationary trigger with when people are spending more through crypto currencies

[26:04] How would it works cryptos and real estate investing syndications with Boron Capital

[28:29] How start to invest in cryptos, how easy is it for new investors

Resources from Jeff

+ Read the transcript

Mike Stohler What if you could be doing something smarter with your money that creates income. Now, if you're wanting to get ahead financially, and enjoy greater freedom of choice, if you want a comfortable retirement, and you know you'll have more choices, if you can do more with your money. Now, if you've wondered who else is creating ways to make their money, work for them, if you want actionable ideas, with honest pros and cons, and no fluff, welcome to the richer geek podcast. We're here helping people find creative ways to build wealth and financial freedom. I'm Mike Stohler. And in this podcast, you'll hear from others who are already doing these things, and mark how you can too. Hey, how's it going, everybody? Welcome back to another episode of the Richard geek. We're joined today by Jeff a second year. He's the CIO for the boron digital large cap fund. His experience and cryptocurrency dates all the way back to 2013. Didn't even know they had that back then. When he bought Bitcoin for the very first time. How's it going, Jeff?

Jeff Sekinger
It's going super well. Thanks for having me on, Michael. Yeah,

Mike Stohler
so that just blew my mind. Cryptocurrency dates all the way back to like 2013 Or is it even earlier than that?

Jeff Sekinger
2009 I mean, technically, there was a coin b There's few actually like two coins before Bitcoin but they weren't successful. So Bitcoin was the first successful actual cryptocurrency that was started in Oh, nine. And a lot of people think it's because of the great financial crisis was in 2008.

Mike Stohler
Wow. I mean, that's unbelievable. So you started your career as an asset management for Chase Bank, JP Morgan, Chase. And then. So what happened? I mean, you left it you decided to invest? How'd you get into crypto?

Jeff Sekinger
Yeah, so I actually got in it back in college. So I'm currently 28 going on 29 years old and in college was, you know, 2013 would have been what mice going into my sophomore year in college, actually may have been my freshman year. So I first got into it, because a lot of people were talking about this, like magic internet money thing that was going on. And back then it was primarily used for nefarious reasons on something called the Silk Road, and like black marketplaces, and that's really what had a lot of kids, primarily talking about it. Then I did some research into it. And I ended up buying some and then I sold it later in 2014. That was actually during a really a massive move for Bitcoin to over a 30x into 2014. So I sold it in 14. Then in 17, I started to rebuy heavily. Before, you know, it was probably around somewhere probably around 1200 bucks when I was starting to rebuy. And then that was that year where it went from, you know, the previous all time high was 1100 and went up to right around 20 grand. And then after the subsequent crash down to about 3020 18. That's when I realized that it was going to be something real. So at that time in 2017, when I started to get heavily back into it, I was actually at that asset management bank, JP Morgan, I was, you know, in private wealth management and wanting to potentially be an advisor and I just realized that the corporate life was not for me and I also always liked unconventional things and Bitcoin and crypto was definitely very unconventional and I just like alternatives. So we were talking about just investments always been attracted to alternative investments. And cryptocurrency was a very interesting thing. And once I started to understand blockchain, I realized that this is going to be a real asset class is going to have a massive impact on the world. And then in 2019, officially started my first fund around the world 100% allocated to cryptocurrency so formally left JPMorgan in 2018 in the summer, and then formally started the first fund in early 2019.

Mike Stohler
And that's with boron, correct?

Jeff Sekinger
Yes, correct. I mean, we have a few I only have funds now the newest fund and fund that's open right now is boron digital? Yep.

Mike Stohler
Okay. And so let's kind of break it down a little bit. For listeners that are my age are more now cryptocurrencies it's, it's a digital currency. Correct.

Jeff Sekinger
And I would also say assets as well. So not just currency asset. And we can jump into that here in a second.

Mike Stohler
Yeah. Because it's I'm starting to learn that. I always thought it was kind of a crypto currency. Now, it's asset. But there are other ways, like beyond a method for payment. There are other functions for these cryptocurrencies. Right. Yeah, correct. Now, if you could explain, what are some of the other I just know, what is the currency? Yeah, that's an asset.

Jeff Sekinger
Got it. So one of the best ways to understand currencies and specifically how Bitcoin is most likely to be implemented in our traditional financial system and just lives in generalize, as potentially a currency in the future is the Bitcoin standard. It's a book that anyone can read a couple 100 pages, helps you understand what money actually is, and how its evolved over time and how Bitcoin and digital currencies are likely to play a role in the economy. But first and foremost, I would say, you know, after starting to read and understand a little bit, you need to understand two different things. So the blockchain technology is completely actually separate than cryptocurrency. So there's, there's cryptography and there's blockchain technology, okay? Blockchain technology is like an open accounting book, it just stores data. So instead of there being a centralized company that has this data, you know, record keeping accounting department, this is a protocol. So it's just a piece of code that stores and records transactions is done in real time, and thus far, for the most part has been completely unhackable. Okay, and it's also unbiased. So there's a lot of pros of using Blockchain technology, and it can be implemented in pretty much any industry, which we can speak about in here in a second. Cryptography is just a way to securely transfer value. Alright, so it'll, it'll, it's pretty much like an encrypted form the transfer value. Okay, so the cryptocurrency is the value transfer system that runs through the blockchain. So we were before we started this, we're talking about coins and tokens, you kind of mentioned that coins are coins that have their own native blockchain. So the blockchain allows like developers to come build on top of the blockchain. And that creates like an ecosystem of different they're called applications that people can build on top of a blockchain. And when you hear tokens, that means that someone you know, is somewhat of a developer came to a different blockchain and said, I want to develop something on here. And I'm going to develop this, this application that also has this token. So if you ever hear token that means that that project does not have its own blockchain. If you hear a coin, that means that coin is tied to a native blockchain and that's its own blockchain. So to give you an idea, you were kind of asking about hey, is this a currencies an asset? How I see Bitcoin currently, is I see it as more of a, you're pretty much buying property in cyberspace. Okay, so it's similar to buying like real estate, where you're buying digital real estate, essentially, it's like the digital gold of this new era that we're moving into. Okay, it's also starting to be used as a currency as well. Now in El Salvador, that's pretty much that test country now. And actually, more people there have Bitcoin wallets, and they do have bank accounts now. So it's, it's blowing up very, very quickly. And it is actually pretty quick. You can use it on a cell phone, you can go to a Starbucks, and you can buy a cup of coffee with Bitcoin. So it is now just starting to be used as a currency because something called the Lightning Network, which is just a network that helps Bitcoin transfer value much, much quicker than what it traditionally does through his own blockchain. But primarily, Bitcoin is used as a store of value with all these other cryptocurrencies, people will call them alt coins, which means it's just an alternative coin to Bitcoin. And they have different things that they do and how I like to summarize it in two words is programmable money. So it is pretty much the the either the coin or the token is used to typically pay for some type of a fee involved. It can also be used for governance, so if you hold 10% of the coins, you have 10% voting rights on what happens to the project in the future. Okay, That's That's one utility of it. Another one. And this is what we like to primarily invest in are coins that have their own blockchain. So when a transaction gets submitted on the blockchain, let's say I'm sending money, I'm saying, Have you heard of Aetherium? Yes, sure. Okay. Let's say that I'm sending Aetherium. From my wallet to your wallet. Okay. That's there's no Aetherium company that's saying, Okay, well, we need to verify that Jeff is sending money to Michael. And it all makes sense because of this. And that, what happens is it's run through a theory is blockchain and it uses a gas fee for that, okay, and the fee used to pay for that transaction. And the fee is paid for in that native coin, which is called eath. So every transaction on the blockchain is using the native coin as a fee. And as a blockchain continues to scale, and it records more transactions. And there's a lot of developers building different type of applications on top of it, it can do a lot of different things. Now, that native coin will be used more and more, because there's more transactions being run through that blockchain, which gives that coin more value, because now it has more utility, because it's being used more often because of the growing number of transactions. So that's a very simple way. And unfortunately, in cryptocurrency, there is a lot of noise and a lot of nonsense. And the vast majority of the projects are, I don't think very prudent investments. We like to invest primarily in Bitcoin. And then we like to invest in a lot of something called layer one blockchains, which are just like the the largest block chains like Aetherium. And there's a coin called BNB that has its own binance Smart chain is what it's called it maybe you've heard of by Nance, the largest exchange in the world, some other coins, like Luna, which is on the Terra blockchain and others

Mike Stohler
like dodge or dodge chain or dodge Dogecoin. Doge. Yes, that's it. I don't even

Jeff Sekinger
Yeah, that was created as a joke to start and the only reputable source that's behind it is Elon Musk. And yeah, we don't hold it because it's, we still kind of see it as a joke. So

Mike Stohler
okay. Now, you had mentioned something about a native cryptocurrency and the way I think of it is, that's the I don't even know what you say is kind of like the the character that you see on the each coin. Yeah, the native M is kind of like the cartoon character or whatever. This is associated with the coin, that the logo, right?

Jeff Sekinger
It looks like a cartoon, because you probably saw the doge one. But yeah,

Mike Stohler
that's the one I just keep seeing in my head. Is that that dog? Now, talk to us about mining? In what that means? And what are some of the static dedicated pairings just all the energy that takes to mine Bitcoin? And what does that really mean? Is it a bunch of people sitting in a room with a bunch of computers and on, you know, mining on blockchains? And what is that all about?

Jeff Sekinger
Yep, so the really cool thing. So when you hear about mining, mining, there's two different types of primarily, there's two different types of blockchains. There's things called Proof of Work, which is means that you have to mine to validate and verify transactions on a blockchain and there's proof of stake. So an example of proof of work where you can mine is Bitcoin. An example of proof of stake is like Solana. And actually Aetherium is a proof of work blockchain that's transitioning over to a proof of stake blockchain. So it's kind of almost like a hybrid, it's not yet moved over to proof of stake yet it is making that move this year. But I'll help you understand the mining aspect of it. The really cool thing and particularly about Bitcoin is the strong, strongest computing network we've ever seen in the history of the world. And the reason is because there is an immense amount of really, really powerful computers that are mining for the cryptocurrency. Now, what does mining even mean? It just means that you're buying this big piece of machinery, it's probably, you know, like a foot and a half long and a foot high. It's they're very loud, and they get very hot as well. So you can't just plug an actual machine in, because it requires commercial outlets and it also gets very hot and it's loud. But what it's doing is it's solving complex mathematical problems. So these machines are just guessing all of these problems and what they're trying to do is get rewarded a block So remember, Blockchain block is just a bunch of transactions that are in one section together. And when one of those miners solves the block, they get rewarded that block. And now that allows that miner to verify and validate all those transactions that's in that block. And then what happens is, though, verify those transactions just by solving those, those mathematical problems, and it's just the machine that you plug in. So it's not like you need to sit on a keyboard and do all this. You buy a machine, you plug it in, and it runs and it tries to guess all these problems. And whichever one guesses it gets rewarded the block and that gets rewarded Bitcoin. So we know for a fact that there's 450 Bitcoin released per day, that amount will not change until something called a halving event happens, which is every four years. It's disinflationary. So over time, the Bitcoin supply actually decreases over time, we're almost at 19 million Bitcoin released in circulating supply right now, and there's only ever going to be 21 million, and that we will officially reach that 21 million by year 2140. So we've got, you know, almost 120 years until we reach the actual Max supply of Bitcoin, but there's only 2 million Bitcoin that are going to be released, and that's left. And that'll be issued out to all the computers mining, whichever, you know, mining computer actually solves the the mathematical problem gets rewarded that block. So what is what you're really doing is you're strengthening when you buy a mining machine, and you plug it in, you are strengthening the computing power on the network. And you're also increasing the security and power of the Bitcoin Blockchain. Because it's becoming that's how it becomes decentralized. I'm sure you've heard that terminology. The more people that are mining for it that are all around the world, the more decentralized it is, because there's not one central entity that is mining for it. So that's how like proof of work works. I'm sure there's a lot of other questions, you have cars, there's a lot of detail that can go into it. But to be honest, is pretty simple. You buy a machine, you plug it into a commercial outlet, and it runs and you just need to make sure that it's cooled. And there's some security involved, and then you will get rewarded Bitcoin on a daily basis,

Mike Stohler
and it's trying to find each individual transaction. Is that what it's doing what you'd like, if you sell me 100 Bitcoin? It's just out there. Waiting. Yeah, so

Jeff Sekinger
I happens. Yeah, if I if I let's go back to that scenario where I'm sending you Bitcoin. Yeah, when I send that that goes through the blockchain at that point in time when it goes into the blockchain. And that's the verify. So those computers that we plugged in that are currently mining, it takes my transaction and it verifies my transaction. And then it says, okay, it came from that wallet and now it's going to Michael's wallet and then it'll send it it'll verify that through the block, the block will get finalized through that the the miners, it'll get hashed to the next block, and then the next amount of transactions will go into the next block. And then you will obviously get the Bitcoin on the other end. So whenever someone's sending money through Bitcoin, it's really like the payments rail almost. It's like I was mentioning earlier, it's the value transfer system is what the blockchain is, and the mining and proof of work. Mining machines just help to verify and validate those transactions.

Mike Stohler
What is going to keep everybody from trying to create their own cryptocurrency, I you know, because it seems like now that Bitcoin has been successful, and a couple of these others Aetherium and all of a sudden, you're seeing all these other ones. I mean, what's there's no regulation, there's no governments? How do you know, fact from fiction and ones that are going to make it? Is it going to be oversaturated with everyone making their own type of coin?

Jeff Sekinger
Yeah, so I mean, literally, anyone can go for your first question. And nothing stops anyone from making a cryptocurrency you can make one in five minutes. And the reason is, because you can literally duplicate someone else's code and create your own coin. So yes, I think it's gonna be very saturated. There's over 20,000 coins now. So we, you know, if you're trying to decide on which cryptocurrency to invest in, it can be definitely a confusing topic. And that's primarily why, you know, people that are accredited like to invest with us, so they don't have to deal with all the nonsense, but like, Yeah, I think that, you know, I think we are moving into a world where there's going to be a few dominant currencies. I don't think they're going to be primarily like a global reserve currency. That's a fiat currency like we currently have as a US dollar. I'm not saying it's going to happen tomorrow, but I think it is. Something that's likely to happen over the next one to two decades where we actually move to a point where now people are using decentralized currencies instead of centralized fiat currencies. Yeah. And I think that's, I think there's going to be a few winners. But I also think there's going to be, there's probably going to be 1000s, if not 10s of 1000s of coins, and it'll actually work a little bit less confusing than you think. A lot of people were like, Oh, well, am I going to be able to pay for everything with any, you know, coin, probably not, you'll probably have a few select coins that you could use to like, make actual, you know, payments at a retail store, grocery store, you know, things like that certain things will be accepted. And I think we are moving to more of a globalized economy. And it'd be really interesting to see which, you know, currencies actually stay strong through these supplemental bear market whenever that comes. And, yeah, I think it's gonna be an interesting time. And I think there's going to be 1000s There's already 10s of 1000s cryptocurrencies, I think that number is just going to continue to grow. But again, I don't think it's going to be as like, confusing and as frightening as everyone kind of like, pictures that to be. That makes sense.

Mike Stohler
You know, one of the things that seems frightening to me is at that point where you have more of the crypto than you do a central banking system. You know, for instance, in the United States, when people are spending more through crypto currencies than they are the actual US dollars, what kind of inflationary trigger? Is that going to? Cause? You know, when there's, there's not enough US Dollars or actual currencies moving throughout the system? Because it seems like the government's all they're doing is saying, What is this cryptocurrency? All we want to do? We just have to tax it. Okay, they're not moving towards actually saying like, you know, what we need to create and regulate or maybe use this crypto currency, you know, they're going to try to stay with the US dollar. So what happens at that tipping point, with the inflation of these world powers or these countries, when the central banking systems aren't that powerful anymore?

Jeff Sekinger
Yeah. So I mean, there's over 200 fiat currencies in the history of the world, there's never been one fiat currency that has ever actually held its value. So it's only a matter of time, I think the actual, the average life expectancy of a fiat currency, I believe it's like 36 years, it's actually relatively low. And to be honest, you know, if you're listening to us, and then you you're in the US, you're, you should be grateful, because there's a lot of other countries that have really, really inflationary currencies like Zimbabwe, where you literally have to wheelbarrow money to go buy a loaf of bread. And that's really, really sad, to be honest, can you imagine working can consistently for decades, and then everything you've worked for just completely gets devalued, and you have absolutely no control over it. And that's what I think the biggest impact that crypto is going to have is more on the developing countries. But you're you know, what you were kind of mentioning about regulation and the tipping point, there's going to be a lot of regulation over the next I think five, especially over the next five years, they're already starting to get into a little bit of regulation. And the problem is, is they're trying to paint cryptocurrencies into a bucket of securities, and it's just not the right thing to classify it as, they're going to have to create a bunch of digital regulations for digital currencies and assets, that is, needs to be separate from the traditional securities laws that are like 100 years old at this point. So they're gonna like at some point, they're going to have to identify all these different sectors within cryptocurrency and the applications, and they're going to need to make their own new laws around how these currencies and assets are going to function in regular society. And that's going to obviously take a decent amount of time. And I think there's going to be a lot of volatility in the price of these cryptocurrencies. In the meantime, I've already openly said that Bitcoin is not they're not competing against Bitcoin, and they're not trying to, you know, create the next Bitcoin. But there's already major countries such as the US that's coming out with something called a cbdc, which is a central bank digital currency. So they're already creating their own digital currencies. We don't I think it's really important for everything to be run on a public blockchain because you know, we just mentioned inflation. That's obviously a really hot topic right now. And it's a big problem, not just in the US, but in pretty much every country around the world now. And the reason Why is because they can just infinitely print money into infinity like I was mentioning, we can we know exactly how much bitcoin is released per day. And we can verify that information on the blockchain. And I think that's what we all need. And that's what the world needs is more transparency. And that's going to come through the use of blockchain. So whenever we do reach that tipping point, I think it's gonna be a really big deal. I think that, you know, the people that are not on, don't take the time to listen to this podcast, and then do further research and understand what is happening and the digital revolution that's happening right before our eyes and the shift and assets and currencies and just general finance and now blockchain technology, they're gonna get themselves in trouble. I think it's really important to have some type of exposure to crypto, whether it's, you know, 1% 5% and 10% 100%. I don't know what you know, percentage of your portfolio should be in that because it's a multitude of different things you'd want to consider. But I think it's really I think it's honestly a higher risk to not have exposure to crypto at this point than to have exposure to crypto.

Mike Stohler
I know some of us that do real estate syndications, we're actually trying to understand the trend to look at how we can do real estate trading and syndications using crypto instead of regular fund. So that's something that's kind of evolving. And it's I think it's coming at you there are a few people that are doing it. But I think it is important. I think it's a way to get some of the specially the younger generation to do some real estate investing is like you have to offer syndications in currency. Yeah, in crypto. Now, you know, if I don't if I don't really know how to do you know, buy crypto. And I want some exposure. You had mentioned that there's like an isn't an exchange traded fund? Or what kind of what do you have with your fund at boron?

Jeff Sekinger
Yeah, so we have like a really well diversified number of assets, we usually hold between like 10 to 15 assets in the fund. And we primarily like we pride ourselves on being more like value investors and fundamental long term investors. We also actively manage 40% of the portfolio because there's a lot of volatility in crypto, but primarily we're investing into, like I was mentioning layer one blockchains that have their own blockchain because we audit the blockchains. And we can see the number of transactions, whether it's increasing or decreasing or number of active active wallets, if that's increasing or decreasing, number of NF T's being minted on the chain, there's a bunch of different metrics, you know, total value locked, which is pretty much like the total amount of money that's being, you know, locked on that specific blockchain and protocol. So we look at a bunch of different metrics, and then we make a decision to hold a few different assets, usually between 10 to 15. It's Bitcoin and primarily different coins that have valuable blockchains. And then we actively manage that. So if someone's accredited, and they don't want to do all the nonsense and worry about regulation, and the you know, all the 20,000 cryptocurrencies at this point, they have the opportunity to invest with us through our fund and have great exposure and, and some pretty decent returns.

Mike Stohler
Yeah, cuz, you know, I think, what, for me, it'd be the safe way, because I don't know what I'm doing. If, if someone said, Hey, go out and buy $500 or $50,000 worth of crypto, I'd be like, okay, you know, the worst thing I could do is just Google, how do I buy and see all the ads that pop up? You know, that'd be the wrong way to do it. So, you know, it seems like this would be for me, like kind of how I can get my feet wet.

Jeff Sekinger
Yeah, it's pretty much the easiest. This is literally the easiest way you can invest into crypto, you signed a few documents, you send a wire over and you get a financial statement sent to you every month. And is that simple.

Mike Stohler
Yeah. And that's, that's fantastic. Jeff, how can people find you?

Jeff Sekinger
Yeah, so I'm pretty active on social media. I produce a fair amount of content myself primarily on YouTube and Instagram. So my name is Jeff Sekinger, je FF s e k i n g er. So if you just type in at Jeff Sekinger, you're on there. And then if you want some more information about the fund, and you're an accredited investor, or maybe you're not even accredited, and you just want to learn more, we have some educational programs that we've had 1000s of clients go through and have had some great results and feedback from those as well. But if you just text crypto, so CR y PTO 287- 777-10615. We will address you know, any type of whether you're an accredited investor and you want to invest or want to learn more about it. We're happy to help in any way.

Mike Stohler
Fantastic. And I appreciate you coming on and the bid for everyone out there the website URL is I think there's more on cat.com. Correct. Yeah, if you want to check out the, the website. Well, Jeff, I appreciate you coming on. And it's a little less fuzzy for me. I think I'm starting to actually figure out but the one thing that I am figuring out is that cryptocurrency is the future. And, you know, you just you have to do it. You know, there's a lot of us, I think, older people, it's like a no, no, I want the green dollar, I want the I want the money, but I really think this is not going to go away. And it's the thing to do. So I appreciate you coming on and have a great evening, Jeff. Absolutely. Thank you, Michael. Thanks for tuning in to the Richard geek podcast, where we're helping others find creative ways to build wealth, and financial freedom. For today's show notes, including all the links and resources from our show, and more information about our guests, visit us at www.therichergeek.com/podcast. And don't forget to jump over to Apple podcasts, Google Play Stitcher, or wherever you get your podcasts and hit the subscribe button. Share with others who can benefit from listening and leave a rating and review to get the podcast in front of your eyes. I appreciate you and thanks for listening

The information, statements, comments, views, and opinions (collectively, “Information”) provided in this podcast are not intended to be and should not be construed as financial, economic, legal, accounting, tax or other advice. For our full disclosure, click here.

ABOUT JEFF SEKINGER

Jeff Sekinger is the Chief Investment Officer for the Boron Digital Large Cap fund. His experience in cryptocurrency dates all the way back to 2013 when

he bought bitcoin for the first time. After graduating with a bachelors in finance in 2016, his professional investment career began in asset management for the largest bank in the US, JP Morgan Chase. Shortly after leaving the firm, Jeff decided to combine his investment experience with his passion for cryptocurrency by co-founding Orca Capital which manages a family of funds in the space.

Jeff is a key component to the fund as it pertains to asset allocation. He conducts extensive fundamental, on-chain, and technical analysis that together has helped the investment funds average a triple digit return since inception. In addition to assisting with the alpha from asset allocation strategies and research, Jeff acts as a forward facing voice of the company by educating investors worldwide about the incredible utility and opportunity that cryptocurrency has and will continue to provide.

Passive InvestmentsNichole StohlerOctober 12, 2022podcast, season 1