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Bitcoin [BTC] investment requires knowledge of blockchain and payments says Lex Sokolin

Aman Swami

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Bitcoin[BTC] investment requires knowledge of blockchain and payments says Lex Sokolin
Source: Pxhere

Lex Sokolin is the Global Director of FinTech strategy at Autonomous Research. He helps financial services senior executives, board members, startup operators, hedge funds, and venture investors make strategic decisions about FinTech, Cryptocurrency, and Innovation.

In the 21st century, cryptocurrency is very controversial given its new technology which people know very little of but it is really here to stay, says Lex Sokolin.

In his expert opinion, he says the underlying technology is really fundamental for the types of companies people are building right now. For any person who is thinking about investing in Bitcoin, the understanding of what Bitcoin refers to is very important. He must understand how the blockchain works and also understand how payments work.

He further says an investor must know whether Bitcoin is fulfilling the promise of enabling digital payments. The price is very volatile in the market. Therefore, an investor must not go and fill his whole portfolio with cryptocurrencies but it is a good alternative to add to his general allocations. The total investment in cryptocurrency in the portfolio must be around three to five percent.

Lex Sokolin says:

“For advisors when you think about cryptocurrencies. Your clients are going to buy Bitcoin whether you like it or not. So you can choose to say that this whole thing will fall apart not get educated on it, not help people but that’s really irresponsible.”

The advisors should start understanding the basics of how the blockchain works, understand why there are differences between the cryptocurrencies. For example, what is the difference between a payments coin like Bitcoin and Ethereum which is a smart contracts platform? All these things are different.

The advisors have to spend the time to formulate simple answers to the clients’ questions which can better the understanding of the client before investing and give them a logical reason to invest so that they can help the clients make sense of this new technology.







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Aman Swami is an Economics major from Christ University. He is very passionate about cryptocurrency and understanding of financial markets.

Bitcoin

Bitcoin [BTC] will take another 22 years to regain its all-time high, says research analyst

Akash Anand

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'Bitcoin [BTC] will take another 22 years to regain its all-time high', says research analyst
Source: Pixabay

Bitcoin [BTC]’s rise and fall has been a consistent event that has grabbed headlines in the cryptocurrency space. According to the latest financial analysis conducted by UBS research analyst Kevin Dennean, the fans of the cryptocurrency will have to wait for over 22 years to climb back to its earlier heights of $19,000- $20,000.

Dennean made these claims comparing the pattern of Bitcoin and the cryptosphere with the trends of other financial system crashes like the Dow Jones crash of 1929, the NASDAQ slide in 2000 and the Oil tumble of 2008. The UBS analyst pointed to how a lot of the cryptocurrency’s proponents stated that Bitcoin is en route to a bull surge because ‘other assets did that in the past’. He laid the foundation for the delayed rise of Bitcoin by saying:

“We’re struck by how long it took other asset bubbles to recover their peak levels (as long as 22 years for the Dow Jones Industrials) and how pedestrian the annualized returns from trough to the recovery often are.”

Dennean was also of the opinion that not every bubble that bursts recovers its old highs, taking the example of the Nikkei crash, which after 30 years of its fall, has still not managed to reach its earlier peak, currently trading at around half its all-time highs. The Japanese asset price bubble was an inflated economic bubble in the late 80s where the real estate and the stock market prices were greatly volatile. In 1992, the price bubble burst and Japan’s economic machine came to a standstill.



Another figure used by Dennean was the fact that all the asset classes, including Bitcoin, fell by 75 percent with Bitcoin breaching the 80 percent barrier. After the crash, only the Dow Jones and the NASDAQ provided a reprieve to users after rising back to its earlier highs.

At the time of writing, Bitcoin was trading for $5292 with a market cap of $93.423 million. The 24-hour trading volume was clocked at $12.985.





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