Three top tips for investing in Bitcoin from a cryptocurrency boss

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A cryptocurrency boss shared his top three tips for investing in bitcoins.

Bitcoin has fallen from $ 80,000 to $ 50,000 since the beginning of April and has depreciated as the Australian stock market hit record highs this week.

A little over a year ago, a Bitcoin was worth just $ 13,000.

It rose during the pandemic and peaked when American billionaire Elon Musk accepted cryptocurrency as payment for his Telsa electric cars – citing environmental concerns via high-performance computers.

Jeremy Ng, the Singapore-based Asia-Pacific executive director of the Gemini Trust cryptocurrency trading platform, said volatility was to be expected, considering that these types of assets have only been around for 13 years.

“We should take a step back and realize that cryptocurrencies are still relatively young as an asset class,” he told Daily Mail Australia.

‘As with any asset class, volatility slowly decreases as it matures.’

A cryptocurrency boss shared his top three tips for investing in bitcoins. Bitcoin has fallen from $ 80,000 to $ 50,000 since the beginning of April and has depreciated as the Australian stock market hit record highs this week

Bitcoin, which was created as a store of value in 2008, has a market capitalization of less than $ 900 million, compared to $ 14.5 trillion for gold.

But Mr Ng predicted that as the dominant cryptocurrency, Bitcoin would one day outperform gold as institutional investors like large corporations dominated the sector rather than individuals trying to get rich quick.

“Gold started out as a medium of exchange, but nobody uses gold as a medium of exchange anymore,” he said.

“It’s become a store of value, that’s how I see Bitcoin too.

“It was developed as a form of transaction, but as it evolves there is a stronger property that bitcoin, like gold, becomes a store of value.”

A little over a year ago, a Bitcoin was worth just $ 13,000. Jeremy Ng, the Singapore-based Asia-Pacific executive director of the Gemini Trust cryptocurrency trading platform, said volatility was to be expected, considering that these types of assets have only been around for 13 years

Cryptocurrency movements in a year

BITCOIN: up 365 percent from $ 13,633 to $ 49,818

ETHEREUM: up 922 percent from $ 336 to $ 3,097

Source: CoinMarketCap data in Australian dollars compared to June 16, 2020 to June 18, 2021

Cryptocurrencies are also following a similar path as early online sales giants like Amazon did in the early 1990s.

“It’s like investing in the Internet in the early 1990s,” said Mr. Ng.

“This is exactly how we see cryptocurrencies: It’s the new Internet, it’s Web 3.0.”

Invest over four years

Mr Ng said cryptocurrency should be viewed as a longer-term investment and advised market participants to pursue a four-year strategy.

“Take a long-term perspective and see how it grows over time,” he said.

Over the past decade, despite the volatility, cryptocurrencies have achieved average annual returns of 20 percent, more than double the 9 percent gain for stocks.

“While Bitcoin is more volatile than stocks or bonds, the yield is also higher,” said Mr. Ng.

‘It gives you a very different perspective on this asset class.’

Dedicate only 3 percent of your portfolio to cryptocurrencies

Someone investing $ 10,000 is advised to use only 3 percent of that on cryptocurrencies, which is the equivalent of $ 300.

Someone investing $ 10,000 is advised to use only 3 percent of that on cryptocurrencies, which is the equivalent of $ 300.  While Bitcoin is a store of value, Ethereum is a new benchmark alternative to commercial banking known as decentralized finance

Someone investing $ 10,000 is advised to use only 3 percent of that on cryptocurrencies, which is the equivalent of $ 300. While Bitcoin is a store of value, Ethereum is a new benchmark alternative to commercial banking known as decentralized finance

“Don’t invest more than you can lose,” said Mr. Ng.

“Start small: Start with an allocation of, for example, 3 to 5 percent.

“As you learn more, you can slowly increase it to 5 to 10 percent.

“Really, the key is don’t make it look like you’re getting rich quick.”

Invest in cryptocurrencies with a specific purpose

While Bitcoin is a store of value, Ethereum is a new benchmark alternative to commercial banking known as decentralized finance.

“Not all cryptocurrencies are created equal. They are not all created equal, ”said Mr. Ng.

There are more than 700 different types of cryptocurrencies, but not all of them will dominate the market unless they have a specific purpose.

“There are many of these coins that you and I have never heard of before,” said Mr. Ng.

“Just like companies, not everyone will survive in the long run.”