Cryptocurrency has been around for over a decade now and has gone from being something circulating the hidden edges of the internet to something the Average Joe can add to their investment portfolio, or as it could be phrased, ‘having a crack at making a few quid without risking the roof over your head or food on the table’.
It was initially the underlying technology, blockchain, that got my interest a few years ago. The concept of a decentralised system to complete transactions and maintain a coherent log of events, enabling attribution, traceability and repeatability, without an authoritative power was fascinating. The uses of this technology started to grow into the arts (to enable creators to receive the credit they deserve), into science (to accurately reproduce the methodology of an experiment for peer review) and global supply chains (accurately tracing food sources, shipments and logistics). Developments in these areas are yet to be prevalent in society, probably based on the infancy in the technology to be used in such critical environments.
However, when it comes to turning money into more money, there’s a queue of people ready to jump on that bandwagon. Which is exactly what has happened in the cryptocurrency markets in the last year, 1 Bitcoin (BTC) went from being worth $5,000 to $60,000 between April 2020–21, that is mad! The type of people investing in this financial market has changed over time too, initially you probably would have been quite techie to really buy into the whole thing as a legitimate investment concept, also predominantly younger people — with a higher risk appetite. Now that individuals and corporates can invest with ease, given the increase in associated trading platforms, the rise of FOMO (Fear Of Missing Out) has driven investment adoption into the next phase.
Recently TESLA, you’ve heard of them right?, recently made a fourth of it’s quarterly profits from selling off a portion of it’s Bitcoin holdings — this contributed around $100 million to it’s bottom line, that’s more than it made selling cars! This received lots of media attention and then there were more eyes on Facebook’s quarterly finances published last night, however this revealed they did not have Bitcoin investments and they are still perusing an alternative, Diem, but nevertheless cryptocurrency adoption is a strategic aim. Where big technology companies go, others usually follow, so expect to see many more companies choosing cryptocurrency, not necessarily Bitcoin though, for holding cash reserves.
The great thing about cryptocurrency, from an investment perspective, is it’s accessibility. Read a review, or 10, about UK based cryptocurrency trading platforms, download the app, prove you’re a human, transfer some money and pick your currency of choice based on some level of market research, guess work, or pick the name you like best — current favourite is OMG for me!