Cryptocurrenices- The Future in Investments

KVIMIS Blog Cryptocurrencies - B School , Coimbatore

Cryptocurrency is essentially virtual coins or digital money which can be transferred between individuals without the need for any financial intermediaries. Apart from the well-known bitcoin, we also have others like Litecoin(LTC),Ethereum (ETH),Zcash (ZEC),Dash (DASH), Ripple (XRP), Monero (XMR) etc.

The demand for cryptocurrency has grown steadily over the last few years especially with the media showcasing how much initial investors have made thus far. Virtual or crypto currencies like Bitcoin and Ethereum are by far the hottest investment product currently available. Cryptocurrencies are not a normal investment and their volatility grossly exceeds that of any other investment class.

Eventhough a lot of early investors are profiting from the eye-popping returns, investment in crypto currencies are suitable for individual investors who has a high-risk tolerance as it's an amazingly risky investment.

Among the hundreds of online currencies, the wealth created by bitcoin has prompted firms like,Dish Network,Expedia etc to start accepting bitcoin payments. For investors looking for investments in crypto currencies, it can be made in three primary ways

Invest in the companies building businesses in the emerging space
Investing in companies dealing with crypto currencies is one of the safest ways to investment. For instance the e tailing company became the first major retailer to accept bitcoin for transactions and its shares have risen 260% rise since August, as it began trading digital coins. The LongFin Corporation, for example, saw its value soar to $7 billion after the company purchased a blockchain-powered global micro-lending solutions provider.

As companies have already seen the financial benefit of associating with cryptocurrencies, in the future more and more organizations are likely adopt cryptocurrencies to strengthen their own stock market valuations and it will continue to be a factor influencing investor decisions.

Buying the digital currencies outright
We have digital currency exchanges worldwide for purchase and sale of these virtual currencies. In India we have the COINOME - Crypto Currency Trading Exchange which is an online platform to buy and sell digital currenices like Bitcoin (BTC), Ethereum (ETH), Litecoin(LTC), Ripple(XRP) and Dash. For a direct investment in a digital currency, investors should look for two traits: longevity and durability. Nicholas Colas, chief market strategist at ConvergEx advices to invest in such online currency that lasts for two years without breaking down.

Research the investment funds being created to hold digital currencies
Cryptocurrency investment funds are the next generation of collective investment schemes that gives investors a myriad of opportunities to participate in what is dubbed as the currency of the future. For instance, Grayscale Investments, a digital currency investment firm has launched four new crypto funds: Bitcoin Cash Investment Trust, Ethereum Investment Trust, Litecoin Investment Trust and XRP Investment Trust. Each fund has a one-year holding period before it can be resold without restrictions.

Ready to deal with the new currency??