Past performance isn't an indicator of future results but it sure takes a dang fool to not pay attention to repeated, prolonged trends, and how they change the world around us. And if past and recent indications are any result, cryptocurrency investors may just own the best possible investments at this time. I'll list some of the reasons below:
- S-curves and new Technologies
Every new technology has to start off from somewhere. At the moment of inception, a new invention has exactly a zero percent market penetration. Japan has just reached 10% market penetration as far as retail investors, as in: 1 in 10 Japanese investors now own Bitcoin. We are already beginning to see an explosion in Bitcoin introduction to society in Japan, following this country's decision to legalize Bitcoin as a currency.
- Chameleon characteristics: Acts like a startup stock, a bond when things are bad, can be used for dividends
I've noted that Bitcoin and popular altcoins behave just like the dotcom stocks of the late 90s. An observation that was made up-close as a new investor into tech stocks in that era. The Web was just beginning to be commoditized as an instrument of commerce and companies like Amazon and Yahoo were young upstarts seeking to disrupt the market and society, while operating with enormous operating losses.
The best cryptocurrencies behave like an explosive start-up's stock during normal times, in this stage of their development and integration into society. However, as noted by Forbes, the threat of war with North Korea and fears of stock market crashes hasn't sent money fleeing to gold and silver, as is traditional. Instead they've both been flat all year while Bitcoin and Ethereum have enjoyed phenomenal gains.
- Inflation Hedge - This means that Bitcoin and other top cryptocurrencies are behaving like the very best inflation and market uncertainty hedges possible, roles that were once fulfilled by gold and silver.
We've seemed to reach a tipping point where through wisdom and/or desperation, people have chosen cryptos to place their faith in cryptos, as a hedge against the loss of purchasing power from one's fiat currency. The future development of Bitcoin and cryptocurrencies is going to be very fascinating and will likely continue to be profitable for long term buy and holders.
Insightful work! Thanks!
The Number headers are off though.
Ack, something off with the way I'm formatting here, sorry.
Thanks for mentioning it. Looked OK in my text windows. Hmm...