5 Reasons Cryptocurrency Should Be a Part of Your Portfolio
Crypto-currencies are the most hotly debated financial prospects of the Internet age. The computer-based form of money pioneered by Bitcoin has exploded in profile and popularity.
Bitcoin started off as a thought experiment, was built by a still-anonymous inventor under a pseudonym, and in its early stages was the domain of the painfully tech savvy and the shady international criminal.
If you’ve heard a lot about why you shouldn’t trust crypto-currencies, that’s not surprising. Here’s the other side of the argument: 5 reasons you should add crypto-currencies to your investment portfolio.
1. The Technology Crypto-currency is Built on Has Major Real-World Applications
The biggest critique leveled at crypto-currency by pessimists is that it has no real-world value, and is essentially a giant bubble based on speculation. This criticism ignores the novelty of blockchain technology, which underpins Bitcoin and other currencies.
Blockchain, which has the potential for unparalleled levels of security, connectivity, and encryption, is being used to revolutionize industries ranging from advertising to shipping, enabling decentralized information sharing and smart contracts.
As these applications expand, you can expect the associated crypto tokens to rise in value.
2. Crypto-currency Is Still Relatively New on The Scene
If a baby had been born when Bitcoin was introduced, it would still be under ten years old. The crypto-currency markets are still in their infancy in the grand scheme of things, and investing (albeit cautiously) in new markets is a good rule of thumb.
That’s not to say you should sink all of your savings into crypto, but adding some to your portfolio and sitting on it could make you a big profit as the market continues to grow.
It’s likely that the price will continue to rise and fall, but looking at the overall price chart for Bitcoin since its introduction shows a steady upward trend that is likely to continue.
3. The “Traditional” Economy Is in Trouble
The unsustainable debt structures that caused the global economy to crash in 2008 have only gotten worse, and another collapse is likely. Cryptocurrencies are among the least correlative assets, meaning they’ll be less impacted by the crash than other investments.
It might behoove you to put some money in cryptocurrency if you’re worried your other assets will be vulnerable in a crash.
4. Major Investment from Industry Is Likely to Boost Crypto Prices
Ethereum is the world’s second largest blockchain, and its Ether token is competing with Bitcoin to be the most popular crypto-currency. The Ethereum Enterprise Alliance is a group of concerns, including universities, auto manufacturers, huge financial bodies like JP Morgan Chase, and even governmental agencies, devoted to exploring the potential of the Ethereum blockchain and its associated token for broader applications in their fields.
This consortium is just one example of the ways that industry is investing in crypto-currency, and these signals of interest are likely to positively impact the price of the tokens involved.
5. Securities Will Allow “Normies” To Invest in Crypto
Securities based on Bitcoin and other crypto-currencies, like the GBTC Bitcoin Investment Trust, are beginning to emerge and grow in popularity. This allows people outside Bitcoin’s techie demographic to invest in the platform.
These securities also have the best chance of gaining regulatory approval, something that crypto has had a problem with in the past. Expect investments from “normal” people to jack the price on crypto up further.
As crypto-currencies have emerged from the dank confines of the dark web, crypto-currencies have caught the attention of many in the traditional finance sector.
These people, well-intentioned as they may be, have a tendency to misunderstand this futuristic form of finance, and as such, to condemn it.
Don’t be so quick to accept their advice! The above are just a few ways that crypto might benefit your portfolio.