With all that is going on in the world right now, you can be forgiven for wondering whether it’s a good time to be getting involved with crypto investments.
For those who are unfamiliar with cryptocurrencies, it could seem like a particularly strange time to be piling money into an investment that, in the example of bitcoin, relies heavily on China for its mining capabilities.
There may indeed be some cause for trepidation, but there are equally some rather interesting investment opportunities available in the crypto world, as they’re often is during an unsettled period in history.
For example trading, via a Cryptocurrency CFD can allow an investor to make money, whether the asset rises or falls within the market.
Often, it is a case of thinking outside the box when adversity hits, and CFD’s fall neatly into this category. But is there any reason to think that crypto could even benefit from the fallout that Covid-19 has created? Some analysts think there is.
Volatility everywhere means crypto isn’t the only gamble in 2020
The volatility of crypto, in general, has meant that not everyone is happy to splash the cash, especially during such times as a worldwide pandemic, but some analysts are looking towards the likes of Bitcoin, Ripple, Ethereum and other cryptos as a good investment during the current international crisis.
During moments of financial uncertainty, people tend to look to investments as a way to hedge against any issues that may arise in either the property sector or the more traditional channels of stock investing. This is where crypto can start to look like an interesting option.
If stocks and shares look volatile, why not take a punt on another notoriously volatile arena, and hope to win big if others share your strategy?
At the beginning of the pandemic, there was an unprecedented global market downturn that was seen in the traditional markets as well as the crypto sphere.
As time went on, a move towards Bitcoin has become apparent, as some investors look to it as a sort of ‘safe-haven’. While usually associated with the likes of gold, calling Bitcoin a ‘safe-haven asset’ does make sense in a lot of ways.
Bitcoin shares many similarities with gold, in that both are decentralized, are not negatively affected by inflation and have a finite supply. While the verdict on whether Bitcoin truly is a safe-haven investment is not fully agreed on, there is no denying that it has proven more resilient than many initially thought it would.
Could 2020 be the year crypto enters the mainstream?
The short-term future of cryptocurrency is a hot-button topic amongst many analysts, with 2020 being touted as a big year for crypto. Bitcoin in particular (which experienced a ‘halving’ in May), is being touted by some as approaching a moment in history where it could enter the ‘perfect storm’.
Bitcoin historically always surges after a halving event, and with the increased media coverage due to the number of investors looking at alternative ways to spread out their portfolio during uncertain times, 2020, or perhaps 2021 could prove to be a high point in the Bitcoin story, with some experts saying that we could end up in a situation similar to the highs of December 2017.
While nothing is certain with any area of investment, there are some good reasons to think Bitcoin and crypto, in general, may well be approaching a particularly important time in its short history.
Will all crypto startups survive? That is highly unlikely. But the big names in the industry, Bitcoin, Ethereum, and Ripple could very well come out of the pandemic in a stronger position thanks to the discussions surrounding them as viable alternatives to currencies that have suffered inflation (such as the USD thanks to quantitative easing employed to combat the Covid-19 situation).
Will this buzz surrounding crypto be enough to push it seriously into the mainstream? That is yet to be seen, but it does mean that more and more investors are starting to look towards crypto as a serious part of any investment portfolio, which, if nothing else, helps the blockchain enter the everyday lexicon that little bit more than in previous years.