THE VIRTUAL ECONOMY – WHAT IF THIS REALLY IS THE FUTURE?

Many economists and traditionalists criticise the virtual economy, arguing that it is not based on anything tangible… This is, in fact, relatively untrue, as it is based on a series of calculations and transactions accepted by the majority: the blockchain

What is blockchain?

A system based on majority control!

Essentially, it is simply an accounting ledger of digital transactions, shared amongst multiple stakeholders. It can only be updated by consensus amongst a majority of the system’s participants. And, once entered, the information can never be overwritten. Thus, the Bitcoin blockchain (for example) contains a definitive and verifiable record of every single Bitcoin transaction ever made.

Quite democratic, isn’t it?

The current economy isn’t based on much these days! Given the state of currency convertibility, haven’t we been in the ‘virtual’ realm for quite some time now? A virtual realm over which we have absolutely no control…

Whilst discussing the emerging new economies with a highly experienced financier, we quickly came to the conclusion that a new sector of the global economy is inexorably shifting.

The speed of data processing, with quantum data transmission soon to follow (and thus absolute security), the mobility of businesses and employees, the variety of tax residency options in an increasing number of countries that have grasped the full appeal of this new economy, new methods of online payment via smartphones, through various online payment platforms or even social media… All of this constitutes the part of the economy that is shifting…

Given that there are around 1,400 cryptocurrencies and new ones are being created every week (see the article: ‘Beyond Bitcoin, other cryptocurrencies are soaring’), it would be very difficult not to take a serious interest in this.

In the article below, Xavier Fernandez explains the journey of a teenage entrepreneur from Valais who has just made a fortune in cryptocurrency before turning 18. He describes his development, notably through investment in property!!

Property and the virtual economy… I really like this fusion, because it is precisely what we are developing as a yield-oriented investment concept:

• The financial security of rental property
• Optimisation of online management costs
• The lightning-fast responsiveness of the web
• The ease of transactions and transfers
• The tax flexibility of choosing your registered address wherever you wish

by Alain Farrugia

The press article below illustrates what the virtual economy can achieve, although we mustn’t get carried away with our dreams...

A millionaire at just 17 thanks to cryptocurrencies

Leonardo bought his first bitcoin at the age of 13

Starting from nothing, a teenager from Valais has amassed a fortune by buying bitcoins and regularly reinvesting his profits

When he left his IT apprenticeship, his teacher predicted he’d end up selling kebabs. Today, Leonardo Vörstratten Von Sylva (his online alias) has made a fortune. “I earned my first million last year. Since then, I’ve continued to make large sums every day,” explains the 17-year-old from Monthey.

He owes his success mainly to cryptocurrencies. His story began when he was just 13 years old. “I was working as a football referee, a job that paid 40 francs per match. One evening, I stayed at the clubhouse to chat with a former coach from my club. He started telling me about these virtual currencies. At first, I didn’t understand a thing. But I looked it up online and, a week later, I bought my first bitcoin,” recalls the young man from Valais.

Diversifying for greater success

One thing led to another, and the budding financier reinvested his capital in new cryptocurrencies, such as ether and litecoin. He surrounded himself with specialists and, together, they set up a ‘mining farm’ (a pool of computers whose computing power is used by the Bitcoin company, which pays them in its currency). At the same time, he purchased some property. “My current project is to create a system that allows for simple and quick transactions, such as paying for a coffee, using cryptocurrencies,” he announces.

Hard to do business before the age of 18

Leonardo Vörstratten’s case is not unique. Eddy Zillan and Erik Finman also made their fortunes before their 18th birthdays thanks to cryptocurrencies. But for these young people who became businessmen before their time, legal complications arise. For example, when it comes to investing in property, it is impossible to sign a deed of sale oneself. The young man from Valais has nevertheless found a workaround: he set up a limited company in his father’s name.

An investment similar to betting

There are thousands of cryptocurrencies, but whilst Bitcoin and Ether have enabled some to amass large sums, these currencies are isolated cases. The majority have never taken off. “Investing in this is a bit like betting on the horse races. You have to back the right horse. Of course, those in the know have an advantage, but luck also plays a significant role. That said, today, there is no other way to make that much money so quickly,” comments an expert we consulted.

by Xavier Fernandez

Source: 20 minutes