According to OnChainFX, since January 1, the exchange rate of the Bitcoin against the US dollar has risen 37% so far this year, surpassing the majority including the S&P 500 (S&P 500) and the Nasdaq 100 (Nasdaq 100). Stock index.
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Although Bitcoin has fallen 80% from its all-time high in 2018, it has performed strongly in recent months, showing new growth momentum.
At the beginning of 2017, the value of Bitcoin was less than $1,000. Since 2017, Bitcoin has risen 400% in about two and a half years.
Is Bitcoin a good alternative investment ?
Last month, Xapo CEO Wences Casares said in a column called "The case for a small allocation to bitcoin": in the $10 million portfolio, the most Bitcoin should be invested 1%, about $100,000, because in the long run, it has the opportunity to bring huge returns, but the risk of losing this investment is also high.
If Bitcoin fails, the portfolio will lose up to $100,000 in 1 to 5 years, or 1% of its value, and most portfolios can withstand this loss. But if Bitcoin succeeds, the value of $100,000 may exceed $25 million in seven to 10 years, more than double the value of the entire initial portfolio.
Although Bitcoin's performance over the past few years has been eclipsed by the unexpected bull market in 2017, Bitcoin has performed relatively well for many asset classes in a larger time frame.
Bitcoin and other digital currencies are currently in the early stages of adoption. The signs of institutional capital inflows did not begin to appear through investment companies such as Grayscale until 2018.
Considering the launch of various hosting solutions, major financial institutions such as Fidelity and Intercontinental Exchange (ICE) began to work in the digital currency market in early 2019.
Investors and entrepreneurs like Casares pointed out that there is still a small percentage of digital currencies that may fail overall. However, if investors understand Bitcoin's digital currency that has survived for 10 years, it provides a long-term investment opportunity.
As Jeff Sprecher, chairman of the New York Stock Exchange (NYSE), said: Bitcoin survived in a bear market. You might think that there are thousands of other tokens that are better than bitcoin, but Bitcoin continues to survive, prosper and attract attention.
The digital currency industry is moving in the right direction
The bitcoin and digital currency industries have survived for a long time, and leading companies have begun to take active measures.
Under the leadership of Bitwise, Gemini, Coinbase and other companies focused on compliance, the digital currency industry has addressed key issues such as false transaction volume, regulatory uncertainty and investor protection.
For example, Gemini received insurance services from Aon in October 2018 to better protect user funds in case of security breaches.
Yusuf Hussain, Gemini's head of risk, said at the time: "Our insurance company not only allows us to provide such protection to our customers, but also sets expectations for consumer protection across the digital currency industry."
How will Bitcoin’s recent performance be?
In the short term, some traders tend to be optimistic about the price movement of Bitcoin as Bitcoin breaks through important resistance levels. However, prices have recently fallen, and investors should pay attention to controlling risks. (CCN Chinese Station)