Friday, December 9, 2022

Get out of Our Treehouse! What Do Hedge Funds Really Mean for Cryptocurrency?

Get out of Our Treehouse! What Do Hedge Funds Really Mean for Cryptocurrency?

According to Autonomous Next, 124 “crypto-funds” launched in 2017 that are collectively managing $2.3 billion USD. These funds focus exclusively on investing and managing cryptocurrencies. But does this new industry actually need them?

Also read: CME Bitcoin Futures to Start Trading in December 2017

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Throughout 2017, investors couldn’t help but see the skyrocketing price of bitcoin. You didn’t have to be a techie to appreciate good ROI. If fidget sticks rose $1,000/share in one month, investors would’ve taken notice of that too.

In addition, banks are developing blockchain technologies. Many traditional money managers have added digital asset management to their clients’ portfolios. However, is the cryptocurrency community ready to be part of the traditional financial world?

The Dream

Before we knew about cryptocurrency, for must of us, the idea of money was solid. Money wasn’t something we could create. It was something that belonged to “the big guys.”

diamond wealthHowever, when exchanged with other like-minded companies and individuals cryptocurrency has changed all that. If cryptocurrency spreads in the right way, it has the potential to change the concept of money for the entire world.

This family sold all they had to invest in Bitcoin. They’re buying and holding (with a little short term trading). They plan to cash out in 2020.

Cryptocurrency has turned average people and kids who collect comic books into miners of valuable assets. People without “family money” or financial know-how have become legit investors, making hundreds of thousands of dollars a year. People in countries all over the world earn something of value for their work, even with no access to traditional banking institutions.

It’s amazing what decentralizing the monetary system has done.

The Hype

However, people actively trying to engage the general population in cryptocurrency investments say, “bitcoin tokens have turned everyday people into millionaires” (which is true). They call it “the new gold.”

Many experts say the blockchain boom has the potential to change the financial world like the worldwide web changed the world of communication in the 90s. People are starting to understand cryptocurrency is something that can have meaning for them; and people are interested.

The Good and the Bad

Encouraging Americans to invest in cryptocurrency as independent traders gives them access to savings and investment opportunities they might not normally have.

In addition, the investments have yielded better ROI than traditional ones. Millennials and other young people have access to decentralized banking and savings alternatives that give them a digital identity and mobile access.

However, hedge funds are notoriously bad, (or not worth it) investments. The fees alone can take up to 30 percent of your earnings after all is said and done. ETFs have lower fees, but people truly interested in cryptocurrency investment would do better to start trading on their own.

savings investment funds

Investment Funds: The Best Case Scenario

Most of the cryptocurrency community understands how much control the international banking system has over politics, our society and the world.

Much of the general population still doesn’t know that yet. Therefore the cryptocurrency community must be diligent, and keep watch over any regulations large institutions and governments could try to sneak past “gen pop”.

If the banks and governments come in and try to regulate cryptocurrency as one big mass, it would completely destroy many of the good things it has done and can do in the future.

If the large companies, banks and institutions that get into cryptocurrency stay in their own lane, creating their own tokens; allowing other digital assets to flourish and not changing the systems that are already in place; it’s possible we could usher in a new tomorrow that both benefits the big guys and the little guys.

Cryptocurrency could continue to give people the opportunity to create a better future for their families and for themselves.

Can this technology actually deliver the benefits it promises? Let’s hear your thoughts.

Images via Pixabay

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