Malcolm Gladwell wrote a bestselling book several years ago called The Tipping Point, which explains how fringe ideas explode into the mainstream. We’re seeing a similar shift today with cryptocurrency. And just like rap’s breakthrough in the ’80s, crypto’s moment may be happening now.
Tipping points are important to recognize because of the opportunity available to those who get in front of them.
To explain the tipping point concept, let’s use an example from music…
It could be argued that rap music was on the outside edges of popular culture until Run DMC had a hit single with their cover of Aerosmith’s song “Walk This Way” in 1986. That version—which included two members of Aerosmith as guests—was a massive hit on both radio and MTV (which still played music at the time). It brought rap into the mainstream in a way no other artist had done up to that time.
Run DMC’s “Walk This Way” was a tipping point for rap music in popular culture. Artists like Vanilla Ice and Eminem likely wouldn’t have found the same level of success without that cultural breakthrough.
In a similar way, several factors are coming together around cryptocurrencies in a way that could indicate they’re reaching their tipping point into mainstream investing culture.
Cryptocurrency and mainstream banking
One of the biggest news stories in crypto is Ripple’s efforts to break into mainstream banking. As we’ve covered before, Ripple is used by financial institutions to transfer money more efficiently.
Ripple apparently isn’t satisfied with staying in the background. Vicky Ge Huang with The Wall Street Journal writes:
Ripple has applied for a national banking license, joining the rush of cryptocurrency companies seeking to cross the divide into mainstream finance.
Ripple, which manages cross-border payments and a dollar-backed stablecoin called RLUSD, filed its application Wednesday with the U.S. Office of the Comptroller of the Currency.
But Ripple isn’t stopping there. Ge Huang continues:
Separately, Ripple subsidiary Standard Custody & Trust Company applied for a Federal Reserve master account on Monday. If granted, the account would allow Ripple to custody the reserves directly with the Fed, and issue and redeem stablecoins outside of normal banking hours.
Here’s why this is important: Ripple’s move to secure a banking charter and gain access to a Federal Reserve master account would put them on similar financial footing as major banks like JPMorgan and Citi.
In other words, they want a seat at the table with the banking giants. Becoming a major player in consumer and business finance by working directly with those markets, not just serving as a go-between.
This is a significant development that will help bring wider acceptance to cryptocurrencies. Wider acceptance drives higher demand—and that usually means higher valuations across the crypto space.
And that’s not the only factor pushing crypto toward its tipping point…
Wall Street is making major moves into cryptocurrencies
That’s right—Wall Street is moving into crypto and treating it as it would any other investment vehicle.
Frances Yue with MarketWatch offers this insight:
A new investment vehicle was launched Wednesday that offers investors exposure to a lesser-known cryptocurrency through traditional brokerage accounts, pointing to a fresh frontier in the digital-asset craze.
It’s a development some analysts say could pave the way for a flurry of exchange-traded funds, or ETFs, pegged to smaller digital assets.
With major trading firms offering crypto access to traditional retail investors, that will increase comfort levels and accelerate adoption—leading, once again, to higher demand and stronger valuations.
Either of these factors alone is a significant push. Together, they could very well mark the tipping point where crypto moves from early adopters to mainstream investors.
What you need to know
With regulators actively considering crypto’s place in mainstream banking—and Wall Street integrating crypto into traditional brokerages—the trend is clear: momentum is building.
Crypto is moving into the mainstream. Those who are already in position stand to benefit the most from the coming avalanche of demand.
To make the most of this opportunity, it’s critical to take smart, informed steps with your investments.
One of the most strategic ways to do that is through a secure, IRS-compliant investment vehicle from BitIRA. We can help you:
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