The Nasdaq Composite is down 14.6 % from its recent all time high.
Cryptocurrencies' prices, a rough measure of which is Bitcoin's price, have been falling also.
Many analysts and investors have in the past expressed different views whether Bitcoin and other cryptocurrencies prices will fall in tandem with technology stocks when the long expected technology stocks crash comes.
While there may be still not a technology stocks crash, the current circa 15 % fall puts a strain on many unprofitable technology and biotechnology stocks. These companies have been losing money and heavily utilizing investors' money to keep their respective companies functioning as a going concern.
Cryptocurrencies were viewed by many as a substitute for gold or some sort of safe heaven. Up till now Bitcoin and other cryptocurrencies are acting like a risky asset.
Cryptocurrencies carry inherent higher leverage than technology stocks, since cryptocurrencies are not part of the capital structure of the respective companies that issued them, so they are not entitled to dividends or bankruptcy proceeds in case of firm default. This inherent volatility of cryptocurrencies insures the high risk and high reward of Bitcoin and the cryptocurrencies asset class in general.
As far as I am concerned, I find the high risk high reward investing profile of cryptocurrencies reasonable. This is similar to the technology stocks investment characteristics. Actually, I think cryptocurrencies could end up as a reasonable vehicle to store value in the future due mainly to the disruptive potential of the blockchain technology underlying Bitcoin.
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