Should Christians Buy Bitcoin?

Bitcoin and Christians
Reading Time: 8 minutes

While I titled this article “Should Christians Buy Bitcoin?”, the fundamentals we’ll discuss will apply to other cryptocurrencies (Litecoin, Ethereum, Monero, etc.) as well as high risk/high return, volatile, and speculative investments in general.

Also, I realize there is a movement afoot that suspects cryptocurrencies are somehow part of the end-times “one world currency” or “mark of the beast”. I am not covering this theory as to a reason Christians should or shouldn’t buy Bitcoin, but focusing on the question of how a good Christian financial steward deals with high-risk and/or speculative investments.

Background
For those who haven’t read up on the recent news of Bitcoin, let’s give a brief overview to begin. Bitcoin is the largest of a slew of digital cryptocurrencies that have been created in the last several years. They exist purely in the digital realm, with no tangible “coin” that you can hold.

However, they do hold characteristics similar to other currencies, such as gold and silver. By design, there are limited amounts of any given cryptocurrency. This makes them a limited resource. In the case of Bitcoin, there will never be more than 21 Million created and in circulation.

All currency is just a medium of exchange that represents value of some other asset. The concept of currency itself goes back to ancient times and is affirmed in scripture. In Deuteronomy 14:24-26 we see the Israelites instructed to sell their tithe (10% of their increase) in exchange for Silver if the place they must go to give their tithe is too far away. Normally, they would bring their actual goods (grain, cattle, wine, etc.) for the tithe, but since it is difficult to transport these a long way, they were allowed to use currency (silver) for their tithe.

Just as Silver represents the value of something else and is in limited supply, making it easy to value, cryptocurrency is the same in the digital realm. Given the way the “blockchain” works, there is continual redundancy and security to ensure each cryptocurrency is only able to used once for a given transaction, making it secure and scalable.

When Bitcoin was first created in 2009, it was worth pennies for each unit (a single Bitcoin). Over time it started to gain ground, reaching over a thousand dollars through the 2014 timeframe before dropping back for a period. 2017 proved to be the year of Bitcoin, however, with rapid growth starting in the Summer and peaking (so far) with gains of over 50% in a single week in early-December (the time of this writing). It peaked at nearly $20k per Bitcoin before dropping back to around $15-16k as of 12/10/2017. Below is a chart of the performance since inception from Bitcoin.com.

Bitcoin Chart Christian

This rapid growth has made some who invested a few thousand dollars early on into millionaires. Many have seen smaller returns and the Winklevoss Twins became the first Bitcoin Billionaires off of their initial $11M investments.

There are few examples of investments that have yielded such incredible returns in such a short period for so many. Much of the recent spike in growth is likely due to “FOMO” (Fear of Missing Out) causing everyone and their brother to buy in. Of course, this has fueled speculation that Bitcoin is just a bubble, as there is no inherent value behind it (like a company). It is only valuable as a currency.

Speculation
Given the volatility and speculative nature of cryptocurrencies, many have wise investors have advised again allocating any of your portfolio to this “scheme”. Rather, they say, stick with proven investments (index funds, real estate, etc.) that will grow slow and steady over time.

This “tortoise and hare” strategy has backing in Scripture. Proverbs 21:5 says “Steady plodding brings prosperity; hasty speculation brings poverty.”. Sounds pretty simple! Open and shut case that Christians shouldn’t invest in speculative, risky ventures, right?

Not so fast…

In the Parable of the Talents (Matthew 25:14-30) and the Parable of the Minas (Luke 19:11-27) we see common themes regarding Christian investing.

The Master (God) has given the servants (Christians) stewardship over some of His possessions and asked them to put it to work for Him. In both stories, some invested well and earned praise and reward. However, one did not and laid away the money in savings (no interest or return at all). This was the servant who was chastised and the little money he had was given to the servant who had invested best.

Here’s a few principles we can learn from these parables:

  • Investment Requires Risk
    If there wasn’t an element of risk with the investment options, the servant who buried his money wouldn’t have been so afraid to invest. He was afraid to lose the money so he chose to save it without yielding any return. The other servants were ok with taking some risk in whatever ventures they put the money to or else they wouldn’t have earned returns!
  • High Returns Require Greater Risk
    It is a proven fact that higher risk yields greater returns. We can see this in something as simple as interest rates in lending. Someone with poor credit (higher risk) has to pay higher interest (higher return for lender). This is because some of the loans the lender makes won’t get paid back at all. There is risk of losing a lot on some, so others must make a higher return in order to compensate for that risk. The lenders average return is not the interest rate that all of these poor credit borrowers is paying because they must also factor in their losses on the defaulting loans as part of the equation.
    Given the great returns the servants achieved for their master, they must have taken some risks! Perhaps they started new businesses, made high risk loans, or traded futures contracts on grain prices. Surely some of those failed, but the overall return was strong as they weren’t afraid to try.
  • Speculation for one may be Investment for Another
    The Bible says in the Parable of the Talents that “each was given in accordance with his ability” (contrast the Parable of the Minas where each was given the same amount). Part of this ability was likely their skill in investing. Perhaps one of them was a skilled vintner (wine maker). Maybe he went out and bought the best plots of land he could find for vineyards in the choicest regions and then proceeded to interview and hire the best vineyard managers out there. Because he knew what to look for, his vineyards were incredibly successful!Now what if another servant, who was perhaps a great shepherd and knew all about selective breeding to get the best flocks, tried to do the same vineyard strategy? He didn’t know much about wine so if he went out and bought vineyards his chances of success would be much less! What was a wise investment for the vintner would be speculation for the shepherd.

Bringing the above back to Bitcoin, we can learn a few things.

First, just because an investment is risky doesn’t immediately disqualify, but qualifies, it! However, it must have potential returns that are proportionate to that risk. If we take a high-risk investment that doesn’t have the potential for high returns, we’re not being good stewards.

Second, investing in Bitcoin may be speculation for one and not for another. Most of the people who bought Bitcoin in the last week have no idea what the underlying technology is, what technical indicators show, or what the valuation models predict. They haven’t read up on the tulip mania and are jumping in purely on hopes that it will keep climbing like it has. These are speculators, not investors.

Contrast this with someone who has studied all of the above points and is making a conscious and deliberate investment. True that no one knows the future for sure, but they have limited their risk since they’ve thoroughly researched the investment. This is wise stewardship and should apply to everything we allocate our money to.

If we don’t know everything ourselves, we should have experts help us. This was largely what the Master was doing in the parables. Likely he wasn’t a better investor in each respective investment than all of his servants. He gave them according to their ability so they could work in that function. I use this strategy by using a fee only Financial Advisor that helps me allocate my portfolio to various investments. He does this full-time and I don’t. Listening to him is much wiser than me trying to become an expert in everything I invest in.

Diversification
The second point to consider with speculative, high-risk investments is diversification.

Ecclesiastes 11:2 says “Invest in seven ventures, yes, in eight; you do not know what disaster may come upon the land.”. What the writer is saying here is that we shouldn’t have “all our eggs in one basket”. It is wise to split up your investments since our ROI isn’t guaranteed.

Any good investment portfolio manages risk by diversifying to different assets. Some allocations may be deliberately counter to one another, meaning that one is expected to go up if another goes down…of course, this means one will always be losing if the other is winning, but it ensures there is protection in either direction. This lowers overall return, but does so while reducing risk even more so. The key to investing isn’t just getting the best return, but getting the best return for a given risk.

So how do we apply this to Bitcoin and other cryptocurrencies?

If you are looking to “get rich quick” and throw 80% of your net worth in to a high-risk investment, you aren’t investing…but gambling. This is foolish and should not be done by a Christian steward. Even if you are successful, you have likely skipped over the character development to handle wealth that God builds over time and will not be successful managing your quickly gotten wealth.

However, it is wise to have some high-risk, high-return assets in your portfolio.

I personally decided to allocate about 1% of my net-worth to a mix of cryptocurrency this past Summer and have seen good very good returns. Because of the rapid growth, this investment now accounts for about 5% of my overall net worth (the rest is a mix of cash, stocks, bonds, real estate, alternative investments, metals, etc.). If crypto continues to grow, I will likely sell some and reallocate it so I don’t get more than 5-7% of my overall net worth in this volatile investment. The rapid 500% returns on my 1% helps offset other investments that are lower return and lower risk. They provide a stable base to allow more speculative ventures. However, if I had lost (or lose!) some or all of the 1%, it won’t have a devastating effect on my portfolio or overall returns.

For someone who is more skilled in crypto, this allocation may be higher (due to their knowledge/ability lowering the risk). However, I would still be hesitant to recommend anyone go over 10-20% total portfolio value due to the inherent unproven nature of this new asset class.

Conversely, someone who has very little understanding of cryptocurrency or needs a lower overall risk profile (nearing retirement, has little savings, etc.), 5-7% may be too much. 1-3% of their portfolio is likely more responsible in this type of investment.

Taking this to the extreme, I’d even say it isn’t inherently wrong for a Christian to buy a lottery ticket! Now I know this is controversial, but I want to reinforce my point above. The lottery is a ridiculously high-risk, high-return investment. Your chances of winning a big jackpot might be one in 300+ Million. However, the potential return is also there! You might win $200M on a $2 “investment”!

So how does this play out? If a Christian were to be making $100k a year and investing 15% ($15k) in long term investments, but decided that half of that ($7k) was going to be used to buy Powerball tickets, they’d be very foolish and a poor steward! However, if they decided to allocate $2 a week ($104 a year, or 0.0066667% of their portfolio, to lotto tickets, it wouldn’t be wrong. The impact on their overall return would be negligible, but there is also an opportunity for them to see an incredible return, greatly increasing their overall portfolio’s return in ways it never could otherwise. This is the extreme, but demonstrates the point well.

Conclusion
Investing in high-risk, volatile, and even speculative investments like Bitcoin isn’t fundamentally wrong for Christians. However, it must be done with the above factors in mind. Only do so if you have a level of understanding that limits the speculative nature of the investment and only allocate a portion of your portfolio that is appropriate for your risk profile. Apply this to all of your investments decisions and you’ll be well on your way to becoming a “10 talent servant”!

Blessings,

Ira

Find Your Donkeys

Reading Time: 6 minutes

If you care at all about finding your “call” or “destiny”, you need to read this. Finding your donkeys may be the single most powerful thing you can do right now to achieve your specific, God ordained calling.

At some point, to some extent, you have likely worried that you are going to “miss it”. Somehow you’ll take a wrong step and not end up where you were supposed to. It is a scary thought. You only have one life, and to waste it because of a few wrong turns is an overwhelming thought. Whether you are making decisions about a professional career, education, ministry, or just life in general, all of us have to figure out what God wants us to do.

I’ve often been faced with this fear. One of my top five strengths is being “Futuristic”. I can rarely go for more than a few minutes without thinking about the future. It is difficult to live in the moment when I am so focused on what’s ahead. This is a blessing and a curse. Strong vision is an asset when it comes to strategy and planning, but a liability when it comes to focusing on what is given today. Combine this futuristic mentality with a dream and drive to achieve great things and the worry of somehow missing “it” can become near debilitating at times.

Thankfully, God showed me this truth that helped put my anxious heart at ease.

In 1 Samuel chapters 9 and 10 we see the first story of Saul. In chapter 8 we see where Israel wanted a king so they could be like other nations and after trying to convince them otherwise, Samuel took their requests to God and He told them He’d give them a king.

While all of this was happening, Saul was not on the top of anyone’s list for greatness. Yes, he was tall and handsome, but he was from the least of the tribes, a Benjamite.

Saul was also not looking to be king. All he was seeking to do was take care of what he was given day by day. One day, that task was finding the donkeys.

Saul’s father lost some donkeys and he asked Saul to take a servant and find them. They searched for a few days and were about to give up when the servant suggested they go ask Samuel for guidance. Initially Saul didn’t want to as he didn’t have any gifts for Samuel, but the servant had some money on hand. He finally agreed to go.

Saul and Samuel had never met and yet God had told Samuel to expect Saul that very day. He even had dinner prepared for him. Samuel revealed that God wanted him to be king, anointed him with oil and laid out exactly what would happen in the coming days.

Saul did as Samuel asked, but on the day he was to be crowned before the people he chickened out. He hid but God revealed where he hid (among the supplies) and the coronation went on as planned.

There is much we can learn from this story about your destiny and I want to highlight a few of those lessons here.

  1. God Calls You to Steward Today
    When we try to achieve our destiny, whether it is God ordained or our own, we usually fail to steward what we’ve been given today. Saul was not trying to become a king. If he were, he’d be out making political connections or fighting grand battles. All he was doing was what his dad had asked him to do.Jesus says in Matthew 6:34 to “not worry about tomorrow, for tomorrow will worry about itself. Each day has enough trouble of its own.”. We often think of this a way to just plod along and get by, eking the best we can out of each day till we die. In reality, this is the recipe for greatness in the Kingdom! God is looking for those that are faithful in little so He can give them much (Luke 16:10). All we should “worry” about is what we’ve been given today.Also, notice that it was Saul’s father that had asked him to go look for the donkeys. At that time in his life, his father was his authority. Sometimes we can even worry about what the right thing to do each day is. An easy answer is to look for the things the authority in your life (your boss, parents, etc.) have asked you to do and start with those. If you get outside of what they’ve asked, be very cautious!Be like Saul and don’t try to find your destiny. Just find your donkeys.
  2. God Is in Control of Your Destiny
    Saul made a couple missteps that could have easily cost him the meeting with Samuel and changed the course of his entire life. First he didn’t want to keep looking for the donkeys and wanted to head home. When his servant tried to convince him to go ask Samuel, he still didn’t want to. Lastly, he tried to hide even after God had confirmed what Samuel promised.It is pretty hard to mess up a plan that God puts in place. He will put the resources and people around you to make it happen. The servant was persistent and provisioned. God gave him exactly what he needed to make the meeting with Samuel happen. Saul couldn’t mess it up although he tried!If we read on in the story of Saul we see that eventually he allowed rebellion in to his life. He spoiled the destiny that God had placed on him not because he missed it, but because he stopped doing our first point (stewarding today). You don’t wander in to rebellion. It’s a choice.If you are focused on stewarding today, God will bring you exactly to the point He wants you. You’ll know if you mess it up.
  3. Your Destiny Doesn’t Need to be Achieved, but Received
    Proverbs 20:21 reads “An inheritance claimed too soon will not be blessed at the end”. When we go try to achieve our destiny on our own, we usually make it happen too quickly with disastrous results. This is exactly what happened when Abraham had Ishmael. Rather than waiting on God, trusting His promise, and receiving the blessing in time, Ishmael became a burden forever.Notice that God often honors the promise even when we rush ahead. If He has put skills and abilities within in you for a certain task they will manifest themselves in some form. If you do it in our own time, it is usually for bad. Perhaps you get anxious in your current job and go look for another rather than waiting for a promotion. While you may be “successful”, that rushing often leads to sorrow and difficulty along the way, rather than peace.Proverbs 10:22 reads “The blessing of the Lord brings Wealth, without painful toil for it”. I don’t know about you, but I’d much rather have wealth without painful toil! Work is great, and encouraged by God, but painful toil is something I want as little of as possible!What is another way to know that our destiny is of God and not our own doing? Destiny is almost always given by authority.

    Saul did not achieve his kingdom by force. It was given to him by Samuel. Prior to Saul, Israel was a theocracy, ruled by God and administered through prophets and judges. As such, it was God’s prophet, Samuel, that anointed Saul. It was clear that he was chosen by God and (almost) all the people saw that. He came to his destiny in peace.

    Wait on the Lord and receive your destiny rather than trying to achieve it.

  4. Your Promotion Often Comes When You Least Expect It
    The Bible is replete with stories of ordinary people that were propelled to greatness in mere moments. Gideon was hiding in a wine press threshing wheat when an Angel appears to him and told him he was going to deliver his people from the Midianites (Judges 6). Abraham was 75 years old when God told him to leave everything he knew and go start a nation (Genesis 12). Joseph was in prison one day and 2nd in command of Egypt the next (Genesis 41).God has a tendency to prepare for a long period and then promote in a short time. The difficult period is the waiting prior to the promotion.Sometimes He reveals the destiny in advance. This can be encouraging as it gives something to hold on to in the waiting, but also can make us tend to become anxious and attempt to achieve the destiny in our own time. Abraham gave up on God’s promise of a nation and had Ishmael.  Joseph almost gave up on the dream of ruling and asked the cupbearer to put in a good word for him and get him out of prison early. It is even more difficult to bear the years of waiting when you have such a clear vision of your destiny.If you are in the place of waiting, be encouraged to know that the promise of your destiny may be closer than you think. Saul went from looking for donkeys to being king in just over a week. Just because you aren’t seeing the gradual build-up that you’d expect toward success doesn’t mean that you won’t end in the same place. Hold on to hope and don’t rush. Rapid promotion often comes when you least expect it!

If you have ever been like me and felt overwhelmed with trying to achieve the call you know God has placed on your life, I hope you find rest and peace in this truth. Stop asking what next 10 steps you need to do to achieve greatness and start asking what your lost donkeys are. They are likely right in front of you and someone in authority has already ask you to go find them.

 

Go find your donkeys.

Pursuing Less, Stewarding More

Reading Time: 5 minutes

Growing up in rural Western NY where the average income was less than $40k a year was a great place to start my life. In this beautiful country of backroads and family farms, a BMW 3-series turns head. Here, a 7-series won’t get a second glance. Going to college isn’t a given back there, and those that do often end up leaving to pursue opportunities elsewhere. If you’ve wondered at all why Trump won, I can give you some good perspective….but that’s a post for another day.

By contrast, Texas is a veritable sea of comparison! Looks seem to be everything and the parade of big homes and expensive cars never end. You can be an up and coming manager with a 6-figure salary, slightly used car, and decent home and still feel like a failure as soon as you step out the door. The bar is set so high that it can feel like a constant struggle just trying to keep up.

Given this backdrop of two worlds, I often find myself torn between being a simple country boy and an up and coming Fortune 500 executive. I am concerned about how I will ever reach the level of success I see all around me. While I am doing extremely well by almost any measure, I see the end of my 20’s fast approaching and wonder if I could have made “Millionaire by 30” status if I had done some things differently over the last 10 years. Many will point to my mild successes and encourage me by comparison, saying that very few are the true wunderkinds and all in all things are going well.

I am grateful for what I have, but I feel a constant self-imposed pressure to do more, achieve more, and find a way come hell or high water to achieve the grand destiny I have pictured in my mind….

…but what if the only way to get true success is to pursue “less”? [tweetthis]what if the only way to get true success is to pursue “less”?[/tweetthis]

Matthew 6:33 says “But seek ye first the kingdom of God, and his righteousness; and all these things shall be added unto you.”. What are the things Jesus is talking about here? Backing up to verses 31 & 32 shows that He is talking about our needs. Now, what is referenced is the basic needs of food, clothing, and shelter. However, don’t you think that God has more than that in mind for us and that He will provide everything we need to accomplish that as well?

God designed us to be partners with Him on earth. John 14:12 says “Very truly I tell you, whoever believes in Me will do the works I have been doing, and they will do even greater things than these, because I am going to the Father.”. He left us here on earth with the work just beginning. He came down and patiently waited 30 years before starting a 3 year ministry. That time was enough for Him to accomplish everything needed to put the Church in motion. After His ascension, there were only 120 believers gathered in the Upper Room, waiting to receive the Power promised to expand the Church. It was this power that grew the Church by 3,000 in a single day, and continued to take it to literally every part of the known world.

Imagine if the disciples and the rest of those gathered that day had decided to pursue “more”? What if in their zeal they headed out to far away cities to spread the news of Jesus’ glorious resurrection, rather than waiting as He had commanded (Luke 24:49)? I have to admit that I’d have been tempted to do just that. I’d have dusted off my MBA, put together a team, and built a strategy for reaching the world with a 5-year plan. I’d have been so focused on the future, I’d have missed the present. I’d be so busy seeking the promise, that I’d have missed the Presence.

The work that God called us to is far greater than anything we could do on our own. On our own we may accomplish some good things, but we will not accomplish Good things. Satan loves to use this trick, lulling people in to a false sense of success by having them do just enough good that they miss the big picture. He allows them to go unharmed as they seek everything but the One who gives it all.

Proverbs 9:10 says “The fear of the LORD is the beginning of wisdom, and knowledge of the Holy One is understanding.” We often ask God to give us wisdom, and it is right that we do (James 1:5), but how many who lack wisdom have gone back to its beginning; the fear of the LORD? What if we chose to pursue the fear of the Lord alone? How do we come to fear Him? Simply by knowing Him! Paul writes in Ephesians 3 that his heart’s desire is simply that the Church would come to understand the “breadth and height and length and depth” (v.18) of God’s love. It is remarkable that he didn’t pray that they would bring more to Christ, baptize more, or pray more. Paul knew that all of those things would follow if people would just begin to understand who God is.

Lately I have been trying to focus on simply knowing God more. Worshiping Him, hearing His voice, obeying His commands. These are simple things that anyone can do, but they are so much harder than the “great” things. In this, God gave me a picture recently that I believe applies to my own life.

Hiram was king of Tyre and a friend and ally of David prior to Solomon’s reign. In 1 Kings 5 we see that he congratulated Solomon on his kingship and Solomon replied by asking for timber to build the Temple. Hiram was able to gladly supply the cedars of Lebanon to allow Solomon to complete the Lord’s work.

What struck me about this story is that Hiram did not plant the cedars. These massive trees had likely lived hundreds of years before he entered the picture. God had taken care of the planting, watering, and growth of the forests, but Hiram was the one who was stewarding them and able to deliver them for this project at that time. In the same way, I realized that the work God has called me to is much greater than what could be accomplished with things that I could plant and grow in my own lifetime. He has been preparing and growing something for me to steward long before I came on the scene. My role now is simply to hear and obey, rather than seek to build and grow.

He has the same things for you. If you have felt overwhelmed by a desire to do good works, I encourage you in this: God has not called you to accomplish Good things alone. [tweetthis]God has not called you to accomplish Good things alone [/tweetthis] He has called you to seek the Kingdom. Knowing Him is the wellspring from which every Good thing flows. I implore you to stop seeking the promise and to start seeking the Presence. You don’t want the promise anyhow if you don’t have Him

As I’ve though about what is most important in life, I’ve realized that the only thing I really want is to know Christ and be known by Christ. If at the end of my life I put all of myself in to this one task and fail at everything else, I will have been a success. If I succeed in the world’s eyes, I will know it is because of Him, not me. I am not perfect in my pursuit, but I am pursuing. I encourage you to do the same. Take your eyes off of the good things around you, and seek His presence. He’s worth it.