After the economic recession in 2009, Bitcoin attracted investors who were curious about the possibilities with cryptocurrency and the fact that this emerging asset was comparable to precious metals.
Flashforward to current times with the Covid-19 pandemic, and many of us learned the importance of savings and investments. People were disgusted with Wall Street’s manipulation and tired of gambling their money away into the stock market (the disasters of GameStop and AMC come to mind).
Real assets seemed more appealing as the days passed, and investors continued to branch out to options that were considered safer, including:
> Real estate (Read about 5 ways it pays investors)
> Gold & Silver (Read 7 “Golden” points on how it offers stability)
> Cryptocurrency (Read about what makes it special)
If you’ve been following along with us here for a while, it’s clear why the attraction to these real assets grew, especially real estate investing.
But you may be wondering, which is the better investment option to grow your wealth: gold & silver or crypto?
When constructing a financial portfolio, any great investor considers every possible asset along with the pros and cons of each. And, it’s always a wise idea to consult your financial advisor; however, we’ve found that the simple answer is that it’s best to have multiple streams of income.
So…why not invest in both?
Here are a few points to consider…
Stable vs. Volatile
Precious metals are price-stable assets, whereas crypto is volatile, and it may require a different investment approach.
The price of gold and silver doesn’t change, and it doesn’t hold the same competitive risk as its digital counterpart.
If price fluctuations seem risky, investors should have a plan of action. When the value of crypto increases, it’s smart to consider when and if you would be ready to take a portion of your profits, if any.
Limited amount of both
Many people have called blockchain-based cryptocurrency “digital gold” because like gold & silver, supply is limited.
Why gold & silver?
✓ Never loses its value, and it’s used as a material for jewelry and other consumer goods
✓ It is not in abundance
✓ The supply is low, and more will have to be mined from the earth over time
✓ It cannot be manufactured
Why cryptocurrency?
✓ According to Markets Insider, crypto is expected to surpass gold’s market cap by 2030.
✓ Can be easily traded on platforms (example: Tesla has even promoted its use)
✓ It is used often in our modern economy due to ease of purchase, exchange and liquidity
✓ Bitcoin is seen as “aspirational” and its value can continue to skyrocket
Final verdict?
While precious metals and crypto have similarities, I’ve found that adding both to your financial portfolio is wise for diversification and a hedge against inflation.
If you want to dive into this further and discuss investment opportunities that may interest you, schedule a call!
To learn more about passive investments, check out our OnDemand Webinar How to Passively Invest. You’ll be given an opportunity to view an exclusive investment opportunity with Caribbean Capital Group, so be sure to check it out!
