Home > Finance > Why is crypto fast becoming the next big investment window?

Why is crypto fast becoming the next big investment window?

Comments are Off

From being a sideline concept to becoming the key to fundamental technologies of the futuristic Web 3.0 world order, cryptocurrency has been booming big time lately. If we check the stats, the number of crypto owners is projected to hit 1 billion by the final lap of 2022. It’s quite an inspiring figure, especially for a comparatively new tech like crypto that is just slightly over a decade old. You have over 18,000 cryptos and more than 600 crypto exchanges to trade cryptocurrency online today. It’s self-explanatory why analysts and experts are lauding crypto as the next big investment vehicle. Check out more at Multibank.io.

The post below offers a brief on the major factors that make crypto the most preferred investment vehicle of the future.

Dramatically higher returns

This one factor is single-handedly driving an increase in investments in the crypto sector.

What is the major pull behind choosing an investment vehicle? How much return would the asset be able to provide? We all want amplified returns and crypto currency takes it to another level altogether. If we compare between stocks and crypto, the average rate of return from stock investments (annually) is around 10%- while it’s an awe-inspiring 18% for crypto, especially for legacy cryptos like Bitcoin.

Also Read: https://multibank.io/page/leverage

Increasing demand

The crypto industry has received over $11 billion from institutional investment by the second quarter of 2022. This is certainly a motivational figure keeping in mind that the crypto industry had been through back-to-back crypto crashes in May-June 2022.

In regard to retail investors, if we consider just the USA base, a mighty number of 46 million+ American adults have expressed their interest in investing in the crypto world by the last leg of 2022.

Increasing interest from investors is piquing the demand for crypto and paving its way towards a sustainable future. This is one of the major reasons why experts deem crypto to be the next big investment window.

The crypto industry started experiencing higher demand from investors especially from the latter half of 2020 when the crypto market started entering a strong bullish phase. If you have been following crypto news, you know by now that the crypto industry surprised the world in 2021 by reaching an eye-popping $3 trillion mark. It’s true that the crypto scene is hovering below $1 trillion after the disastrous crash but the market is poised to rise by 5x by the coming 7-8 years.

Allows indirect investment

Even though the crypto scene has been witnessing a welcome surge in investment and trade cryptocurrency online, a big bunch of investors had been apprehensive for long. However, those apprehensions are gradually melting away now that you can enter the crypto world but still not get directly affected by sudden disastrous crashes in the crypto market. It’s the launch of crypto ETFs, especially the launch of the first BTC ETF in 2021 that has done wonders to lessen the apprehension and pull in more people into cryptos.

The advantage of crypto ETFs is that since it’s an indirect crypto investment, you won’t have to face a major impact if the crypto market takes a dip all of a sudden. The crypto ETF options have provided a comparatively safer zone for investment in the crypto world. This particular development is pulling in even more investors to the crypto world, thereby piquing up the demand for crypto.

According to market experts, the launch of crypto ETF, especially the U.S. ETF, would help to bring higher liquidity, increased utility, as well as higher scale of adoption in the crypto scene.

Currency of futuristic tech

The web 3.0 world order is just knocking at the door. Both as a professional and an individual, we need to adapt ourselves with the changing world order to thrive in the future. Interestingly, crypto is the currency of the most crucial technologies of the Web 3.0 world order, say NFT and Metaverse. In fact, as of now, crypto is the sole currency for these cutting-edge tech platforms. Put simply, crypto is the key to take part in the futuristic technologies of the upcoming world order. This is certainly a prime reason why crypto investment is crucial and why the asset is being considered as the next big investment window for the future.

Increasing attention to regulation

Despite the booming culture of crypto, one of the major barriers for several investors and traders has surely been the unregulated nature of the crypto world. It’s the lack of regulation that leads to wild volatility in the crypto market. But, the crypto world is changing. As of 2022, the EU has already signed MiCA that has outlined regulations to be followed by crypto-related businesses. The USA and other countries of the world are also being proactive about creating regulations for the crypto scene.

Increasing enforcement of regulations is expected to drive up further interest and eventually investment and trade cryptocurrency online.

Final words

We will wrap up the article with a few pro tips on investment in the crypto zone.

First, always be careful about your budget for investment and trade cryptocurrency online.  Your total capital investment, if you are a beginner, should not cross 2% of your overall investment budget. After you become acquainted with the ropes of investment and trade cryptocurrency online, you can gradually increase the budget to 5 to 10%. Do not ever tread further than 15%.

Do not depend on investment and trade cryptocurrency online for building your wealth. Crypto is an extremely volatile asset and can plummet from millions to zero in a matter of few days, you cannot depend on such an unstable asset for building your wealth. However, since crypto offers higher returns than other investment vehicles, you can count on investment and trade cryptocurrency online for adding more boost to your wealth.

Be choosy with your selected assets for investment and trade cryptocurrency online.  You should have at least one legacy coin in your portfolio, say Ether or Bitcoin. These assure more stability and more liquidity, and more returns than other cryptos. Besides, you should also add in a stablecoin in your portfolio. Put simply, follow a diversified portfolio to ensure a safe well-guarded investment experience.