Many investors wonder when will be the right time to put some money in Bitcoin. It is a question that financial advisors listen to more and more these days.
However, the advisors, for the most part, do not recommend investing in digital currency, nor in the investment vehicles that have arisen around them, at all. In fact, earlier this year, Merrill Lynch banned the purchase of bitcoins throughout the company.
JP Morgan President Jamie Dimon called Bitcoin a "fraud" (he then softened some of his comments), and Vanguard CEO Tim Buckley told CNBC in an interview: "You will never see a Vanguard fund in Bitcoin" .
There is no doubt that Bitcoin has been extremely volatile, so for the moment, many advisors remain cautious and urge investors to completely avoid investments in cryptocurrencies.
He continued saying :
Even if Bitcoin is blocked, blockchain is the future
Microinvestment builds wealth little by little
Lex Sokolin, global director of fintech strategy at Autonomous Research, believes it's a big mistake.
"Cryptocurrencies are very controversial, but they really are here to stay," he said. "And the underlying blockchain technology is really fundamental for the types of companies that people are building at the moment."
It is important for people who want to invest in cryptocurrencies to first understand what blockchain technology is and how it works, explained Sokolin.
To be sure, one of the most convincing things about cryptocurrencies is actually blockchain, he added. Until then, Amazon has just announced that its cloud computing arm is partnering with a new company called Kaleido to make it easier for customers to place their services on blockchain.
"It's volatile at the moment, so you should not go and fill your entire portfolio with cryptocurrencies," he said. "But it's a good way to add alternatives to your general allowance, something like 3% to 5% of your portfolio."
Sokolin warned financial advisers that their customers are going to buy bitcoins, like it or not.
"So the advisors can choose to say that all this will collapse and they will not be educated about it and they will not help the investors, but that is really irresponsible," he said.
The advisors should take the time and review the cryptocurrency and blockchain technology issues so that they can respond appropriately to their clients' questions, explained Sokolin.
"Advisors really need to start understanding the basics of how blockchain works," he said. "Begin to understand why there are different cryptocurrencies. What is the difference between a payment currency, such as Bitcoin or Ethereum? "Sokolin added. "All these things are different, so the advisors have to spend time so they can help their clients make sense of this."
Source: CNBC
They need to watch what they do, not what they say. That same JP Morgan bought the Poloniex crypto exchange office for $ 400 million. So all their statements are controversial.
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