Cryptocurrencies have captured the imagination of the investment world, with the bright lights of astronomical price appreciation fuelling the fire that a new, lucrative investment class has been born and is here to stay.
Cryptocurrencies – should I invest?
A key feature that enables cryptocurrency to exist is Blockchain. The Blockchain is a digital, public ledger of every transaction that has ever been recorded across a peer-to-peer network of computers. This type of technology is now being considered on a far wider scale than just currency, with the potential to enable transaction work to be completed cost effectively and efficiently, reducing business risk and regulatory burden across many industries. Cryptocurrency has certainly introduced new and exciting technology such as Blockchain, but what are the issues that this technology is raising?
How will regulators respond to the industry?
How regulators around the world react remains a big unknown and is a key issue for the ongoing viability of the industry.
Who uses cryptocurrencies?
For now cryptocurrency use is confined mainly to criminals, rogue states and a handful of true believers and speculators.
Are cryptocurrencies a good store of value?
We don’t know the answer to this question, other than to say the jury is still out. We do think that history is not on your side though.
What about all the other Initial Coins Offerings?
It’s probably a reasonable guess that most will fail, and many have no investment credibility whatsoever.
Can we provide advice on cryptocurrencies?
We think their uncertain future and the infancy of the industry means this is an area that is far too immature to be considered investment-grade as an asset class.
Do get in touch with one of our advisers here at Robertson Scannell if you would like to discuss this subject further, or if you have any questions.