It’s too late to make contingency plans for the next financial crisis – it’s already here. And by the looks of things, it isn’t going to be abating any time soon.
It’s certainly not too late to protect your wealth though. As the world comes to terms with the economic shock caused by an epidemiological crisis-induced-recession, smart investors are putting their money to work.
Through astutely rebalancing your portfolio, you can not only protect yourself from the worst of the economic downturn, but earn yield that will grow your nest egg in the months and years to come. Panic selling and buying will not be necessary. But it is imperative to act fast to preserve your wealth and gain exposure to the greatest wealth creation opportunities that the coming years will present.
Buying Bitcoin as an Alternative Investment
Just as gold became the leading global asset due to production being a reliably small percentage of its existing supply, bitcoin’s quadrennial halvings guarantee a diminishing supply growth rate, making it an increasingly attractive speculative option for many investors.
You don’t need to be bullish or bearish on gold or bitcoin to recognize their potential as interest rates fall and the Federal Reserve risks inflation by injecting trillions of dollars of liquidity into the market. Unlike fiat currency, the supply of gold nor bitcoin cannot be wilfully increased: humans have been hunting for gold for thousands of years with ever-diminishing returns, its high stock-to-flow ratio making it the perfect hedge, and bitcoin is often dubbed digital gold due to similar properties.
Bullish on Bitcoin
The world’s best-known and most widely-used cryptocurrency has seen big growth in institutional interest: last year, crypto-focused hedge funds rose to more than $2 billion, up 100% from 2018. The average value per fund increased from $21.9 million to $44 million, with two-thirds of active crypto hedge funds having launched in the last two years. Such investment is easy to appreciate: after all, bitcoin ended the 2010s as the decade’s best-performing asset.
Bitcoin’s price recently rallied above $10,000 for the first time since late February, as anticipation mounted ahead of its third halving, when block rewards for miners fell from 12.5 to 6.25 BTC. The cryptocurrency’s supply is strictly limited, capped at 21 million coins.
As more people demand to hold it, appreciation of the existing supply occurs. And with each bitcoin divisible into 100 million satoshis, there’s enough to go around, despite bitcoin’s much-vaunted digital scarcity.
It’s much easier to acquire than gold too; bitcoin can be instantly purchased through platforms such as Skrill and sold just as easily. Skrill is known to be simple for first-time investors, allowing them to acquire bitcoin quickly and easily. Having facilitated digital payments since 2001, Skrill’s integration of cryptocurrency makes business sense, while adding utility for…