Five reasons to believe in bitcoin and participate in the cryptocurrency market
Known cryptozoologist Alex Lieser (Alex Lielacher) in an article for Brave New Coin gives five reasons not to lose faith in bitcoin (or believe in him with new force).
The current level of bitcoin prices can be a great starting point for many investors.
2018 has been a difficult year for bitcoin— hontarov who had to watch the fall of the digital currency number one more than 50% since the beginning of the year. However, there are five reasons that will help you not to lose faith in bitcoin.
1. The institutional ecosystem for bitcoin is growing
The announcement of the Intercontinental Exchange (ICE) on the launch of the exchange of digital assets for institutional investors in November — big news for holders of scriptaction in the current year.
Intercontinental Exchange (ICE) is the owner of the new York stock exchange (NYSE), and it intends to give investors the opportunity to trade futures on bitcoin.
While bitcoin can already be considered as a viable asset class, the launch of a new scriptactive giant on wall street— exactly what able to meet the needs of the institutional investment community.
And on this side of the Atlantic is the second largest securities exchange Germany, Boerse Stuttgart also announced plans to launch a cryptocurrency trading platform. As reported by FinExtra, she will specialize in ICO, trading and the safe storage of digital currencies.
While bitcoin is going to become a part of institutional portfolios, the barriers on this way to gradually taper off. Before starting the solution of ICE for large investors keeping funds just a few months, and this will be a welcome institutional “at the pump” for the market.
2. Regulators have realized that bitcoin is here to stay
One of the biggest risks to bitcoin for many years came from the regulators, as they and the government can try to eradicate the cryptocurrency as a method to conduct transactions that bypass financial institutions.
At the beginning of 2018, this risk played a role in the price decline of bitcoin. In March, the group discussed the global rules for digital currencies. Fortunately, the Twenty participants came to the conclusion that cryptocurrencies threaten the financial system. Thus, the global counter cryptocurrency will not happen.
In addition, several countries and jurisdictions have demonstrated a positive attitude towards crypto and desire to develop blockchain— industry. Belarus, Bermuda, Gibraltar, Malta, and Switzerland aim to become the leading blockchain hubs, and Germany is going to officially legalize bitcoin as payment means.
3. ETF is not far off
Although it is impossible with complete certainty that we will see the emergence of publicly traded bitcoin ETF, the majority of scientists believe that it is only a matter of time.
The stack of applications for new bitcoin ETF is waiting for approval on the table of the Commission on securities and exchange Commission (SEC), as SEC Commissioner Esther pierce stated that he did not agree with the recent denial of the Winklevoss brothers, and that this refusal is bad for innovation.
Moreover, if you already have regulated bitcoin futures on CME the Cboe and approved by the CFTC, it is difficult to imagine a scenario in which bitcoin ETF and will not be approved by U.S. regulators.
4. A great asset for portfolio diversification
These studies, Yale University talking about the fact that every diversified investment portfolio should contain from 1 to 6% of bitcoins, depending on the beliefs of the investor.
The study authors found that bitcoin and cryptocurrencies are not affected by General stock market and macroeconomic factors and that they do not correlate with other currencies, or commodities. According to them, courses of cryptocurrencies depend only on factors of the stock market.
In addition, the work States that the bitcoin and Ripple of air have a higher Sharpe ratio than stocks or bonds, and that means in terms of risk of non-repayment of funds they have higher profitability.
5. Demand growth in emerging markets
According to LocalBitcoins, despite the current bear market, the sales volume of bitcoins in emerging markets has already started to move towards the highs of 2017.
For example, over the past few months a significant increase in trading volume occurred in countries such as Kenya, Mexico, Nigeria and the Philippines. Also people from Argentina, Venezuela, and Zimbabwe, where the national currency is rapidly depreciating, and now more inclined to the recognition of bitcoin and the volume of trading in these States has reached new highs in 2018.
Even if most buyers from developing countries are small retail investors who can’t compete with institutional, their activity shows a trend towards the recognition of bitcoin at the global level.