First Bitcoin. Then GameStop. Now Tiny Tungsten Cubes.
Online investors crave the tangible pleasure of holding surprisingly heavy metal blocks.
4 min
Copyright 2020, Dow Jones & Company, Inc. All Rights Reserved Worldwide. LEARN MORE
They bought the bitcoin dip. They took GameStop to the moon. Now the online investor army has a new favourite thing to buy and hold: small tungsten cubes.
Even in a year that has featured dog-meme cryptocurrencies and rappers shilling SPACs, tungsten cubes stand out. They are as inert as they sound: gray, an inch or two on each side and 1.7 times as dense as lead. A major selling point, according to Amazon.com’s product page, is that they are “extremely heavy for their size.”
That also is their main source of appeal to crypto bros and other enthusiasts who caused a run on supplies at a major tungsten provider in recent weeks. They are shelling out around $400 apiece for 2-inch cubes weighing around 5 pounds, or $3,000 for the 4-inch version as heavy as a low-horsepower outboard motor—and almost three times the price.
While cube enthusiasts overlap with aficionados of ephemeral varieties of digital money prone to heart-stopping swings in value, their new paperweights, given their density, are among the most-tangible things on earth. Tungsten has one of the highest tensile strengths and melting points among metals.
Drew Morris, a 35-year-old Florida lawyer at a blockchain intelligence company, bought his 1½-inch cube after friends came across it on Twitter and in Telegram group chats. He found the density mind-blowing.
“I keep it on my desk as a reminder of what motivates me—keep going, keep working,” said Mr. Morris, who also invests in cryptocurrencies. “One day, I’ll be able to upgrade to a larger-size cube.”
Cubists like Mr. Morris got recent inspiration from a niche corner of online life: financial Twitter. Fintwit, as it is called, typically consists of investors small and large debating the direction of markets, the prospects for inflation and recipes for grilled meats. Lately, photos of smoked brisket have given away to pictures of cubes.
Nic Carter, founding partner at the blockchain-focused venture-capital firm Castle Island Ventures, describes himself in his twitter bio as the “original tungpiller.” He said the physical heft of the cubes contrasts with the intangible nature of cryptomarkets.
“We’re just deprived of physical totems of our affection, and so tungsten fills that hole in our hearts,” he said.
Demand intensified after Neeraj K. Agrawal, director of communications at Coin Center, a nonprofit cryptocurrency research and advocacy group, posted a joke mock-up of a faked Bloomberg News story claiming crypto traders were behind an imaginary global tungsten shortage.
“I’m gonna be buried with my cube probably,” said Mr. Agrawal. “It will be like a pharaoh buried with his possessions, so the cube will have a place of honor.”
Cube enthusiasts often describe them in quasimystical terms. “You kind of start wondering about gravity and the forces of nature, and it can send you on an out-there-wandering experience,” said Rabbi Michael Caras, an Albany-based Jewish day-school teacher, who uses the twitter handle @thebitcoinrabbi. He owns a 1½-inch cube.
“It’s kind of like a disconnect between what your eyes are seeing and what you’re feeling and what you expect from something that fits in the palm of your hand,” he said.
There is a rallying cry: “We like the cube.” That’s a play on the phrase “We like the stock,” often used on sites such as Reddit’s WallStreetBets to show support for buying shares of GameStop Corp., AMC Entertainment Holdings Inc. or other meme stocks.
The hype sparked a surge in demand at Midwest Tungsten Service Inc., which sells the cubes, along with tungsten in various industrial forms for use in things such as wiring and cutting tools. Midwest Tungsten General Manager Kevin Anetsberger said the $6 billion to $9 billion global tungsten market can support the burgeoning demand for cubes, though the company did need to replenish inventories.
“The universal response whenever we’ve had anybody in our facility, and we’ve handed them tungsten to hold, it’s kind of astonishment,” said Mr. Anetsberger, a 36-year veteran of the company.
While Mr. Anetsberger won’t comment on how much Midwest Tungsten has made from the recent sales, it last week began accepting payments in bitcoin. The first order arrived eight minutes later.
An anonymous group of crypto advocates recently minted 500 digital cubes as nonfungible tokens—unique digital identifiers that have powered this year’s boom in sales of digital collectibles and art, such as NBA Top Shot and the American artist Beeple’s $69 million “Everydays: The First 5,000 Days.” The tungsten NFTs, already sold out, entitle holders to a single real cube of equivalent size. Proceeds go to crypto advocacy groups, including Mr. Agrawal’s Coin Center.
Midwest Tungsten recently launched an NFT of a 14-inch cube weighing almost 1,800 pounds. Buy an NFT and you can visit the cube once a year. On social media, the company requested photos of the cubes in their new homes. “Is it an only-cube?” the firm tweeted.
Daniel Matuszewski, co-founder of cryptocurrency investment firm CMS Holdings, asked Midwest Tungsten to make a 7-inch cube engraved with the company’s name in comic sans. Mr. Matuszewski said the roughly 230-pound cube should arrive sometime around the winter holidays. All in, the company has spent more than $50,000 on branded cubes, he said.
“We have a pretty interesting fight going on internally, whether or not somebody is actually going to be able to pick that up,” Mr. Matuszewski said.
Midwest Tungsten also sells tungsten spheres.
Mr. Morris, the Florida lawyer, isn’t much interested. “We like the cube,” he said.
Reprinted by permission of The Wall Street Journal, Copyright 2021 Dow Jones & Company. Inc. All Rights Reserved Worldwide. Original date of publication: October 28, 2021.
Chris Dixon, a partner who led the charge, says he has a ‘very long-term horizon’
Americans now think they need at least $1.25 million for retirement, a 20% increase from a year ago, according to a survey by Northwestern Mutual
There’s more to building substantial savings than putting away what you can after paying your bills
4 min
Whether you’re starting your wealth creation journey in your 20s, 30s, 40s, 50s or beyond, the core principles remain consistent. Create more income, manage your savings, and invest intelligently.
We look at the best wealth creation strategies depending on which decade you’re in right now.
In your 20s
The key to wealth creation is to start early. So if you’re reading this and you’re in your 20s, you’re well ahead of the game.
Accept that the greatest investment you can make is in yourself and your ability to earn an income.
“If you want to build wealth in Australia, you need to have a plan to be earning more than $100,000 per annum either now or within the next five years,” financial planner Chris Carlin says. “Most finance experts focus on ways to reduce your expenses, which is important, but for sustainable long-term wealth creation, we believe that you should be focusing on ways to increase your income rather than just focus on reducing your expenses.
For more stories like this, order your copy of the latest issue of Kanebridge Quarterly magazine here.
“If you need to change careers, study, start a business or ask for a pay rise, do whatever it takes to get your income above that level while you’ve got time on your side. Next step is to buy a house, because the sooner you get your foot in the door of the property market, the easier it will be for you to build wealth over the long term.”
Bear in mind that your first home doesn’t need to be your forever home. Think of it as your foot in the door to build wealth.
“If you’re accessing a first home buyers grant, you only need to live in it for 12 months and then you can consider converting it into an investment property or selling it,” Carlin says.
In your 30s
This is the time in life to establish a regular investment strategy. Consider long-term investments that you can lock up for five to 10 years. You can take on more risk at this time of your life, which can generate higher returns.
Set your priorities for life, and don’t take on more debt than you can afford to pay back.
Also, keep track of expenses and income with budget planners — a great habit to get into now.
There are many other things you should be considering too, such as topping up your super above the Super Guarantee and reviewing your personal insurance and investments.
In your 40s
This can be an expensive time of life, particularly if you’re supporting a family. But you’re probably in a more stable financial position by now, giving you a good springboard into investments such as a diversified portfolio of shares.
Investing in property is the best option at this age, whether it’s the family home or an additional property that can be utilised for an Airbnb. Also, make sure you rein in your debt. A bank loan for a mortgage is one thing, but debt on credit cards is hard to justify by this stage of your life.
Invest in your retirement by topping up your superannuation. Even an additional $50 a month will benefit from the wonders of compound interest.
Generally speaking, shares outperform other investments over the longer term. And if you invest in companies that pay dividends, you’ll benefit from being paid part of the company’s profits, generally twice a year. While dividends are less common in a downturn like we’re having now, they are likely to increase once company profits recover.
In your 50s (and beyond)
If you’re in your 50s or older, traditional financial planning tends to encourage less aggressive asset classes as people near retirement.
If you’re in a low asset position due to divorce and having to start again or you’ve missed the real estate boom and are still renting, the main focus should be on controlling spending and pumping money into super and savings and then investing aggressively, advises financial adviser and money coach Max Phelps.
“Property investing is either an option through super, or outside of super if the deposit can be raised,” he says. “Outside of super, properties with scope to improve, extend or subdivide will help build capital faster than normal market growth, to help catch up.”
Share investing could also be an option, with particular focus on high growth funds, such as international securities.
“Controlling spending at a level just above the aged pension should be a key focus, otherwise it’ll be a big step down when you finally stop work. Use a good budgeting and planning app,” Phelps says.
However, if you own your own home, and have a standard super balance, focus on the home and perhaps look at downsizing opportunities in the future.
“Maximising super contributions is likely to be beneficial to get the tax savings, potentially using a transition to retirement strategy,” he says. “For those looking for a sea or tree change, we would always recommend keeping the family home until a year or two after moving to a new area to make sure it really suits.
“For those wanting to stay in the same home forever, releasing equity to buy a couple of high yielding investment properties could be a good option, with the time to pay down the mortgages and keep them for additional income for retirement,” Phelps says.
If your own home is paid off and you have a high super balance and a strong asset position, the focus will likely be on asset protection and less risky asset allocation for investments, he says.
Whatever age you are, consider getting help now. The right financial advice early can set you on the right track.
The pandemic has given us a year of lousy sleep and insomnia. Here’s what to do.
Bitcoin soared to an all-time high on Monday, hitting US$19,850 in the morning before again slipping below US$19,500 by the afternoon. It has nearly doubled in just the past two months. The cryptocurrency has been boosted by a flurry of endorsements from traditional investors, favourable government policies, and expanded access on investment apps, as Barron’s noted this …
Continue reading “Bitcoin Hits High of $19,850 As Doubters Become Believers”
