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A lot of people are still on the fence about cryptocurrency, but if you want to have a complete portfolio, you cannot avoid it. Cryptocurrencies are viewed as legitimate assets by most serious investors and even those who come out against them have had at least some exposure to the cryptocurrency markets. Crypto is also now more mainstream than ever, and it might be on the brink of mass adoption, which could solidify it as an asset even more. Let’s take a look at why crypto should be a part of everyone’s investment portfolio.
It Could Counterbalance Inflation
One of the main goals when investing is to beat inflation. Bitcoin and other cryptocurrency’s deflationary nature makes them a great shield against it. Some insiders even said that Bitcoin is a better shield against inflation than gold and that it’s comparable to gold as a store of value. It’s not clear if Bitcoin or any crypto is as good as gold if you want to store value, but one thing you should know is that they behave very differently from other assets and aren’t affected in the same way by fiscal policy changes. As a matter of fact, any measure that bring inflations would stand to benefit Bitcoin and other comparable cryptocurrencies.
Usage is Growing
People are also starting to use crypto for transactions. More and more businesses are starting to accept it. Bitcoin saw a massive 880% increase in usage from 2020 to 2021, and adoption is still growing. Bitcoin is being accepted by over 18,000 businesses right now and some industries have been more eager to accept it than others, like the gaming sector, for instance.
You can use bitcoin as a deposit method for online casino players, for instance. Major platforms like G2A have also decided to accept cryptocurrency payments lately and it’s only a matter of time before platforms like Steam do the same. This could mark a shift in the adoption of cryptocurrencies and really help them become recognised as true currencies.
You Still Have Lots of Space to Grow
You should never fall victim to FOMO, or fear of missing out, when considering cryptocurrency. You don’t want to invest half of your money into cryptocurrencies just because they’re having a good week. With that being said, no one knows what could happen with them and you should have at least some level of exposure in case they blow up. The level of exposure will depend on you, but most advisors will recommend that you have anywhere from 2% to 5% of your assets in crypto. That will be enough for you to get a significant return if they go ballistic and not take that much of a hit if they take a plunge. You can also always add to your position whenever you wish.
As you can see, there are tons of reasons why owning at least a bit of crypto is always a good idea. Before you write them off, learn what prominent figures in the investment community have to say about them and learn what they are and aren’t.
