Possibly the biggest reason you’re already in Bitcoin, is that there’s little incentive for the financial services industry to change that for you.
Bitcoin is for everyday investors, because when it’s not busy completely replacing the global financial system, it’s just another thing you can invest in. It shouldn’t be a big deal right?
On one hand, it’s just another investment option. On the other hand, it’s actually quite different to anything else out there. I recall watching a documentary on light a few years ago – If my memory serves, physicists don’t yet agree on whether or not light is a particle of a wave. In Bitcoin circles, regulators are trying to figure out whether or not it’s a currency, or a security. A Government ban on this asset would be ill-advised by all accounts, but further regulation is inevitable. Either way, the time for being dismissive or burying one’s head in the sand is well and truly over. Regardless of what Bitcoin ‘is’ we need to decide if we should own it.
Even Satoshi Nakamoto him/her/themselves, called Bitcoin a peer to peer electronic cash system – but as a medium of exchange only, Bitcoin hasn’t really found it’s place. It’s almost as if it’s showing us what it wants to become.
So far we can see, Bitcoin is kind of like money, it’s kind of like gold, and it appears attract itself to countries and individuals on the fringe, who dream dreams of big changes in the future.
“Who controls money control the world.” Henry Kissinger
The core argument of Bitcoin is around centralized vs decentralized authority. Will Government and Central Bank control currency in 10 years time, or will that power finally be able to rest on the shoulders of the community instead? I’d be amazed to see this kind of power-transfer happen with ease.
There’s a deafening silence around Bitcoin in the financial advice community at the moment, but that will change. It’ll likely change when there’s a revenue model for current institutions to work with. This sounds cynical, but it’s not entirely so: The biggest roadblock to faster adoption to everyday investors is the issue of custody. Once there are solutions that don’t require you and me to ‘be our own bank’, I’d expect to see more KiwiSaver providers hitching their wagons to the Bitcoin engine quick smart.
Even a tiny allocation towards Bitcoin may have a tremendous impact on portfolio performance without significant increases to risk.
We’re having to make a choice in this fork in the road. Here are your multiple choices just to make things easier, select what you think is correct:
Bitcoin is a vaccine for a financial pandemic yet to come.
Bitcoin is a scam, a fad, and bad for the environment.
Bitcoin has it’s place in any mainstream portfolio.
Choose your side here but don’t tarry. History may show us we’ll be punished for changing our minds later. To quote the maximalists out there, ‘the price you pay for Bitcoin is the price you deserve.’
*Investing in Bitcoin carries a significant amount of risk – do your own research and get advice before acting on anything here. Darcy Ungaro is a financial adviser, with qualifications and experience to offer personalized advice around digital assets like Bitcoin.
I recommend Easy Crypto for any Crypto buyer based in NZ (as mentioned in this show)