Through the years, I have held most of my cash in US dollars, but also have held some accounts in Canadian dollars and Chinese renminbi.
However, diversification among the various flavors of state-sponsored fiat currency offers little protection from the fiscal and monetary profligacy that could eventually threaten each of these currencies.
Over the past half-decade, part of my solution to this problem has been to diversify my cash holding into cryptocurrencies such as bitcoin, litecoin, dash, ether, zcash, and monero. While bitcoin is my favorite currency for 2017, it has been far from the best performer among cryptocurrencies. How am I comfortable with substantial exposure to BTC?
In part, because I am a miner.
My experience mining Bitcoin and other cryptocurrencies gives me confidence in how hard it is to increase their supply. It is very hard to mine profitably. It has worked out well only due to their subsequent price increase as opposed to the profitability of mining itself. It is much easier for governments to print currency than for miners to make BTC. As President Trump says, “believe me”.
If you really must join me as a miner, do so only with access to cheap electricity. Venezuela would be particularly good were it not for social unrest and legal complications. Iceland is among the best locales that avoids such problems – it is a beautiful country populated by beautiful people and no social unrest. For the most part, if you want BTC, just buy it..