17% of Americans Are Invested in Cryptocurrency — Should You Invest?
Bitcoin and cryptocurrencies overall have rebounded this year, following a slow and steady 2023, which came on the heels of a couple of years marred by scandals, collapses, losses and lawsuits. So, it’s no wonder that adoption and positive sentiment around the assets are also growing.
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Several factors have buoyed the industry — namely, the long-awaited approval of spot bitcoin exchange-traded funds in January, deemed by many a landmark decision for the crypto industry, followed by the most recent approval of spot ethereum ETFs in May.
These began trading on July 23, as GOBankingRates previously reported.
In turn, a recent Morning Consult survey found that while cryptocurrency ownership remained consistent with the previous quarter, there is an “uptick in those considering purchasing cryptocurrency.”
For instance, 17% of U.S. adults owned cryptocurrency as of May, and a whopping 25% of adults said “it’s likely they’ll purchase cryptocurrency in the next month, up 3 percentage points since January 2024 and 5 points since October 2023,” according to the survey.
The global crypto market cap stands at $2.14 trillion as of Aug. 13, according to CoinMarketCap, and the price of bitcoin, the largest crypto, stands at $60,896. And while having recently experienced a lot of volatility, the asset is up more than 107% in the past year, according to CoinGecko.
Against this backdrop, here is what experts had to say about why bitcoin and crypto in general remain potentially good investments.
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Growing Institutional Acceptance and Legitimacy
The ETF approvals have further legitimized the crypto space and have sparked a lot of interest among investors. In addition, these investment vehicles can make access to crypto less intimidating and easier for many investors.
In addition to the growing institutional acceptance, Edward Corona, trader, strategist, publisher of The Options Oracle Newsletter, noted that bitcoin’s scarcity and decentralized nature make it an attractive hedge against traditional market volatility and inflation — making it “a solid investment.”
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Easier To Invest In
Corona also noted that the ETFs make it much easier for everyday investors to gain exposure to bitcoin without needing to directly purchase and store the digital currency. In turn, this could lead to a substantial influx of new investors, particularly those who are more comfortable with traditional financial products.
‘While it’s true that traditional stocks tied to the crypto space, like MicroStrategy and Coinbase, offer indirect exposure, the real excitement is around these bitcoin ETFs,” he said. “They will likely democratize access to bitcoin, making it a part of the average investor’s portfolio in a way we haven’t seen before.”
Brian Dixon, CEO, Off The Chain Capital, also noted the growing ease with which investors can now get exposure to crypto assets.
The ETFs, he said, have created a “massive and easy onramp for them to enter the space.”
The numbers speak for themselves: assets under management of crypto investment products — which “had fallen to $75 billion, wiping over $20 billion off in the correction,” have since recovered to $85 billion, according to an Aug. 10 CoinShares report.
A Great Way To Diversify
Another point that Dixon made is that the broader macroeconomic outlook is shifting right now, and it’s creating a situation in which more investors will likely allocate a larger portion of their portfolios to crypto assets.
“They’re likely to do this because of the growth potential, of course, but also because crypto has now become a useful and productive way to diversify portfolios,” he added.
Growing Adoption Means Growing Prices
As Markus Levin, co-founder of XYO Network, explained, in general, the rise in price investors are seeing is partly a result of growing adoption.
In turn, he said, this means that the next drawdowns likely won’t be as intense because more people are adopting and using the technology.
Post-Election Rally
Finally, some experts believe that prices will skyrocket after the presidential election.
For instance, Michael Terpin, who founded the crypto venture capital firm Transform Ventures, told Forbes that “October and November are historically strong months for bitcoin, especially in the year of the halving and the year after.
He added that a Trump presidency could bring in a “rush of new buyers” and push bitcoin’s price to “over $100,000,” Forbes reported.
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This article originally appeared on GOBankingRates.com: 17% of Americans Are Invested in Cryptocurrency — Should You Invest?