Russell Okung #76 of the Carolina Panthers
Grant Halverson | Getty Images
It’s typically described as a brand-new type of gold, and now Carolina Panthers offending linemen Russell Okung is making a huge bet on bitcoin.
After an almost two-year fight, Okung lastly had his dream approved and will have his wage diverted to acquiring bitcoin with the help of mobile payment company Strike. The National Football League and its gamers’ union authorized the arrangement that enables the Panthers to pay part of Okung’s $13 million wage to Strike so it can be transformed to bitcoin.
“Money is more than currency; it’s power,” stated Okung in a declaration. “The way money is handled from creation to dissemination is part of that power. Getting paid in bitcoin is the first step of opting out of the corrupt, manipulated economy we all inhabit.”
To be clear, the Panthers are not paying Okung straight in bitcoin. Instead, the group will divert approximately $6.5 million from Okung’s wage to the Strike, which will then most likely take a cost and procedure bitcoin deals for Okung, a long time supporter of the currency.
Strike did not react to a CNBC demand to verify the deal charges connected with Okung’s arrangement.
Bitcoin is trading at more than $27,000, so Okung will get roughly 240 coins at that worth. Since his playing days with the Los Angeles Chargers in 2019, Okung lobbied to have his wage changed with bitcoin.
“He’s hoping long-term that the price of bitcoin is going up,” Chris Matta, co-founder of Crescent Crypto Asset Management, informed CNBC on Tuesday. “And this move is a show of his support and long-term bullishness for bitcoin growing even more from here.”
It’s like gold, however it’s not gold
Bitcoin was presented in 2008 and in 2015 produced fortunes for some when a single bitcoin rose from under $1,000 to almost $20,000. That triggered a booming market in brand-new crypto-based funds.
Bitcoin has actually because gotten appeal with Covid-19 interrupting economies as financiers search for safekeeping throughout the pandemic. For years, gold was the typical safeguard for financiers, however Matta stated bitcoin is now considered as an option.
“It’s become hugely attractive as a hard asset, especially during Covid-19 and all the consumer concerns about the global economy and geopolitical environment,” Matta stated, referencing billionaire hedge fund supervisor Paul Tudor Jones’ remarks to invest more in bitcoin.
“The new digital gold, as it’s called,” Matta included. “It’s brought bitcoin to the forefront of investment portfolios this year, and there is a ton of interest around it as a result.”
Matta stated Okung’s bitcoin would likely be positioned in offline digital wallets described as “cold storage.” The relocation provides Okung more security from possible hackers aiming to take the currency from his account. Bitcoin accounts aren’t secured like savings account, which are FDIC-insured.
“Keeping it offline is a much safer way, especially for someone like Russ who is outspoken about bitcoin,” Matta stated. “Anyone who is vocal in the bitcoin space is a target for cyber-hacking.”
Russell Okung #76 of the Los Angeles Chargers avoids the field following the video game versus the Seattle Seahawks at CenturyLink Field on November 4, 2018 in Seattle, Washington.
Otto Greule Jr | Getty Images
But like any financial investment, Okung, 32, is be taking a significant threat.
Drew Hawkins, the CEO of Edyoucore, a monetary consulting company, stated the regular deceptive activity surrounding bitcoin is an issue and included, “a great deal of men require to comprehend what it is and how it works and what it is not.
“It’s a threat in regards to what they’re going to get in their hands with surefire dollars from an agreement versus of taking possibilities with concerns to what this worth of bitcoin will or will not be,” Hawkins stated.
Though approaching fresh highs, volatility still haunts bitcoin due to its high corrections history, which in 2017 dropped the trading rate to $3,000 for a single coin.
On Monday, Mark Newton of Newton Advisors informed CNBC’s “Trading Nation” his estimations show bitcoin’s current cycle “peaking out in early January.” He stated there might be chances to begin purchasing bitcoin at lower rates already.
“Bitcoin has actually been an incredibly unstable property,” said Matta. “But over the longer term, it’s most likely been the very best carrying out property of the last 10 years. But if you do not understand what you’re doing and not purchasing this thing long-lasting, there will be a great deal of volatility in-between.”
Added Hawkins: “People have actually succeeded and made a great deal of cash off of it, however you have actually likewise had an equivalent quantity of scenarios that wound up not panning out to what someone was preparing for or wound up in some significant losses.”
Are more professional athletes going bitcoin?
Strike is likewise collaborating more plans replicating Okung’s with gamers from the Brooklyn Nets and New York Yankees, according to bitcoin news website CoinDesk. The website did not call the gamers included.
Matta stated Okung’s relocation would offer more trustworthiness for bitcoin, which might set off much more professional athletes to purchase digital currencies. Potential financiers can likewise acquire bitcoin through other mobile payment apps, consisting of PayPal, Cash App, and Square.
“Covid-19 hyper-charged the development of bitcoin,” Matta said. “I believe this would’ve taken place to bitcoin anyhow; it simply might have taken a couple of more years to get to this point.”
–CNBC’s Hugh Son added to this report.