The way we invest in cryptocurrencies is changing—and that’s a good thing
Alternative ways of investing in cryptocurrencies are becoming more common, and one of the most promising alternatives is Global Blockchain Technologies (CVE:BLOC; OTCMKTS:BLKCF).
Despite their rising popularity among investors, cryptocurrencies are still considered to be a very risky prospect for many. Even ignoring the markets, investors need to be fairly tech savvy in order to navigate the wallets and exchanges, and many will not be properly protecting their cryptocurrencies.
In order to provide an easier entry into the cryptocurrency world, a number of alternative ways to invest in cryptocurrency have become popular. One of the most promising of these is Global Blockchain Technologies (CVE:BLOC; OTCMKTS:BLKCF).
Why do investors want alternative solutions?
Despite its popularity, cryptocurrency is not a simple thing to invest in. Just purchasing anything other than one of the “big three” (bitcoin, litecoin and ethereum) can prove to be a technical headache. Investors, who may not be particularly tech-savvy, will likely purchase their coins using an exchange like Coinbase or Bitfinex without realizing the risks.
The simple fact is that if you don’t own the keys to your wallet, you don’t own the coins. If you keep your cryptocurrency in an exchange wallet, you are relying on that exchange to protect your investment.
The problem is that they do not have a great track record. In a report from Blockgeeks, the most recent high-profile breach was the Bitfinex hack in August 2017, when attackers made off with $72 million in cryptocurrency. To offset the loss, Bitfinex took the controversial decision to reduce everybody’s account balance by 37%, per TechCrunch.
To avoid this, many cryptocurrency users keep their coins offline or in cold storage, which involves keeping your coins in some kind of hardware wallet or by using a piece of paper that lists your codes. This is the safest way to protect your investment—but is not practical if you wish to engage in day trading.
Some investors who are interested in cryptocurrency find this level of non-market risk unacceptable, so they look for alternative solutions. Good thing that there are a number of different ways to invest in cryptocurrency now.
One example is the cryptocurrency portfolio available on the CFD broker, eToro. Unlike most CFD brokers, it offers a cryptocurrency portfolio leveraged against real assets. Investors are unable to withdraw their bitcoin, but their investment with eToro is backed by one-to-one with bitcoin. It also offers investors the ability to follow the decisions of more experienced investors, which can be a useful learning tool.
Another potential alternative is the cryptocurrency index fund, Crypto20. This is the first fully tokenized cryptocurrency index fund, and its purpose is to offer investors a single token backed by the top 20 cryptocurrencies by market cap. Crypto20 keeps fees at just 0.5% per year by using automation to weight the portfolio.
The most interesting alternative is Global Blockchain Technologies, which offers something that other cryptocurrency investment alternatives lack. Global Blockchain Technologies is a cryptocurrency investment firm with a team of experienced experts like its chairman, Steven Nerayoff, who was one of the lead advisors for Ethereum.
Unlike the other options, Global Blockchain Technologies is able to leverage its experience and capital to find offerings that other investors may well miss. It is able to use its initial coin offering (ICO) incubator to get in on promising projects at the ground floor. The company is also the lead investor in KODAKcoin, according to Newsfile. Global Blockchain Technologies is able to give investors unique early access to promising ICOs by simply adding CVE:BLOC or OTCMKTS:BLKCF to their online broker.
This is a huge advantage over managed or even index funds. If the company is successful, then shareholders and investors will be able to reap rewards without being unduly exposed to sudden market shifts because Global Blockchain Technologies will have already protected itself against this as part of its business model.
While alternative investments won’t suit all investors, they are an excellent choice for more risk-averse or technically challenged investors. Global Blockchain Technologies offers an interesting service that nobody else has really managed to match.
In December 2017, cryptocurrency finally hit the mainstream. As the price of Bitcoin skyrocketed to nearly $20,000, investors around the world scrambled to get a piece of the pie. The Bitcoin bull run was not to last, and fears of regulation and a bubble led to a market crash that knocked its price back down to $6,000.
Despite the recent downturn, it’s not all doom and gloom. Many analysts believe that the market is stabilizing and will slowly begin to bounce back over the course of 2018. This is partially due to the shift in the type of cryptocurrencies we’re seeing. Many new initial coin offerings (ICOs) are closer to startups than currencies, and this has the potential to offer high returns for savvy investors.
The problem is that cryptocurrency as a safe investment is not straightforward by any means. Setting aside the technical barriers to entry, the market is very young and very complicated, which can make it a struggle for uninitiated investors to navigate it. This is where Global Blockchain Technologies (OTCMKTS:BLKCF, TSXV:BLOC) offers an exciting alternative.
The cryptocurrency market had become unsustainable because of inexperienced investors
One refrain you often hear in a bubbly bull market is: “It’s impossible not to make money in this market!” Many inexperienced investors piled into a market banking on ever-increasing returns.
Unfortunately, bubbles are born to burst. Just before Christmas last year, the market crashed—leaving crowds of confused investors wondering what had happened.
The problem was largely down to the crypto-mania that blinded many new investors with promises of quick profits. Overhyped advertising and the number of Ponzi and “pump and dump” schemes had led to a market completely devoid of logic. Some early adopters and long-term investors saw that this inexperienced money flooding in was creating a false economy. In those conditions, market regulation was all but inevitable.
The legislation that started the cryptocurrency bear market may have actually helped to shield it from a complete meltdown. China and South Korea were two of the most popular cryptocurrency markets, and they took action to prevent a sudden crash from crippling their economies. Ironically, this legislation may well have saved the cryptocurrency market from a complete collapse.
The market has begun to stabilize and the future is still bright—if you know where to look
The sudden crash hit home to new investors that cryptocurrency is a volatile, high-risk investment. In the long term, this will have a positive effect as it has helped to clear out many of the less experienced investors, and now, some sanity will begin to return to the market. This will also lead to better-regulated markets, which should help provide some much-needed stability and accountability.
Now that some of the air has been let out, it is unlikely we will see a return to the mania-fuelled bubble of late 2017. Despite that, there are still real profits to be made if you have an understanding of blockchain technology and the market. Many mainstream investors lack this background knowledge, so their best option is to rely on the experience of others. This is where Global Blockchain Technologies and its ICO incubator come into play.
Global Blockchain Technologies enables investors to benefit from its team’s knowledge of the cryptocurrency simply by adding BLOC to their online broker. This helps investors avoid some of the pitfalls associated with using exchanges and wallets, but more importantly, it helps shield them from the worst of the market volatility that defines cryptocurrency.
The company doesn’t just hold cryptocurrency as an asset—it also invests in promising startups using ICOs. It also balances out many of its “blue-chip” cryptocurrency holdings like Bitcoin or Ethereum with mid- to small-size cryptocurrencies. Its team is also intimately familiar with the cryptocurrency market, so the company is better able to predict trends than a normal investor.
One of the key selling points of Global Blockchain Technologies is its ability to identify new and promising startups. Its ICO incubator allows Global Blockchain’s investors to gain access to promising startups much earlier than other investors.
Its incubator has already helped them invest in a variety of startups, including Millennial eSports (TSX VENTURE: GAME) and Breaking Data Corp. (TSXV: BKD, OTC: BKDCF).
Global Blockchain’s incubator is important because it allows its investors to take advantage of new ICOs without taking undue risks. Any ICO that is supported by Global Blockchain has been vetted for viability and has access to its capital and expertise, and as a result, it is more likely to succeed.
These factors allow Global Blockchain Technologies to make investments both easier and safer. Easier, because you no longer need to worry about exchanges and wallets and can simply use your online broker. Safer, because the company will be able to better shield itself from market volatility.
Of course, this also means that Global Blockchain will unlikely provide investors with the same huge returns that Bitcoin saw in 2017. Thankfully, the company doesn’t need to—if it can provide investors with reliable returns, then it will have shown that cryptocurrency is maturing into a viable investment choice.
For instance, Global Blockchain recently announced that shareholders will own twice the amount of shares after the company’s stock split. They will also receive the same amount of shares in Global Blockchain Mining Corp. following the split and spinout, as well as an opportunity to vote on the spinout during the company’s special meeting this coming April.
Additionally, Global Blockchain president Shidan Gouran hinted that this move was to further improve the “pure play” market value for its new ICO, token and blockchain incubation/investment and cryptocurrency mining. The company plans to have a spinout in order to achieve the full potential of its two businesses. With the stock split, it can gain some improvements in the liquidity of the two entities in the future.
If Global Blockchain Technologies is able to make cryptocurrency a safe investment, then it is likely that we will see the market grow in a more sustainable way and hopefully avoid any more large bubbles.
This article was written by a third party contributor and does not reflect the opinion of Born2Invest, its management, staff or its associates. Please review our disclaimer for more information.
This article may include forward-looking statements. These forward-looking statements generally are identified by the words “believe,” “project,” “estimate,” “become,” “plan,” “will,” and similar expressions. These forward-looking statements involve known and unknown risks as well as uncertainties, including those discussed in the following cautionary statements and elsewhere in this article and on this site. Although the Company may believe that its expectations are based on reasonable assumptions, the actual results that the Company may achieve may differ materially from any forward-looking statements, which reflect the opinions of the management of the Company only as of the date hereof. Additionally, please make sure to read these important disclosures.
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