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In our final exploration of cryptocurrencies, we’ll look at the viability of investing in say, Bitcoin, rather than a second home or other real estate venture.
For most people, their home is the biggest investment they’ll ever make. After all, real estate rarely goes down in value. But cryptocurrency appears to be another viable investment option.
But, the jury is still out. Depending on the source, cryptocurrency is either an excellent investment, or should be considered high risk and speculative.
In 2017, these digital currencies, including Bitcoin and Ethereum, produced a staggering 445% in total returns through the first half of the year, outpacing more traditional assets such as real estate, gold, and equities.
But then in January of this year, all the major brands plummeted in value within 7 days. Bitcoin dropped from $19,000 a coin to $6,000. The average price for all brands fell by more than 13% in the last few days of March, resulting in a market loss of $40 billion.
Experienced investors understand that there are always risks involved, that there will always be market fluctuations. Advisers who were ‘bullish’ on cryptocurrency are still optimistic, assuming that any downturns are a reflection of the market in general, and that Bitcoin, Ethereum, and other brands will bounce back.
However, for those not willing or able to risk investing in what is still considered by most to be a speculative venture, real estate is still a more conservative, long-term investment.