Cryptocurrency Essential Element Of A Modern Investment Portfolio

In the past couple of years, cryptocurrencies have gained this great fame and popularity and more investors are adopting them as short and long term investments. The main issue with investors adding cryptoassets to their investment portfolio is that of classing them. This has gone on to be a major issue that investors have to face.

Cryptocurrencies in general could not be termed as currencies. Although, they are being used to make payments for goods and services bought, they can still not be classed as currencies. The reason is that these cryptocurrencies are volatile which instantly discredits them as currencies. Cryptocurrencies can not also be termed as income products nor a commodity. So it becomes very difficult for investors to include them in their investment portfolio as they do not know where to class them under the portfolio.

Adam White and Chris Burnisike in a whitepaper that was released in 2016 stated that Bitcoin and cryptocurrencies should be classed as assets. They make this statement with three criterias in mind, they state that first of all, an asset must be investable, providing an opportunity to invest as well as ample liquidity. Secondly, an asset must possess a different economic profile that should arise on the basis of the value, governance and use, finally, the market of an asset must be able to fluctuate independently and should exhibit a certain correlation in their returns. With these criterias in mind, cryptocurrencies shoud then be classed as assets.

The whitepaper published and updated by Adam White and Chris Burnisike proved to be one of the most important works that have been written about cryptocurrencies and investment portfolios. It solves the problem of having to look for where to class cryptocurrencies in the portfolio of investors. Most experts are of the opinion that classing cryptocurrencies as an asset in your investment portfolio comes with a huge risk especially for those long term investors who try as best as possible to reduce risk of losing their entire savings. To back it up, these experts are saying that since the beginning of the year, cryptocurrencies like Bitcoin has seen over a 50% fall in price from what it was as at December 2017.

Asides cryptocurrencies, these investors has flooded ICO projects with millions of dollars gotten after every ICO project is closed. Generally, the money to be made from adding cryptocurrencies to your investment portfolio is why most investors would jump on it. As an investor you do not have to wait for your financial advisor to bring the news about cryptocurrencies to you, you have to carry out your own research. Cryptocurrencies are here to stay and they are already solving world problems. Asides that, several companies have dived into the crypto market, as they have developed certain platforms that ensure that you fully manage your investments. One of these platforms is the Cryptech Global which gives you the opportunity to manage all your investment portfolio with real time market analysis and charts.