Become A Digital Asset Investor
The most popular way to invest in blockchain technology is by becoming a digital asset investor. As a digital asset investor, you simply invest in assets that reside on a blockchain.
When thinking about these types of assets, youre probably most familiar with cryptocurrency .
Investing in cryptocurrency is relatively straightforward. First, set up an account on a cryptocurrency exchange, like Coinbase or Gemini. Then, use the platform to buy your desired crypto.
Cryptocurrencies arent the only kind of digital asset available to you, though. Gold, art, stocks, real estate all of these investment opportunities are available as assets on a blockchain.
One form of digital asset, security tokens, have started to gain traction in the past year. As you could probably guess, security tokens are the blockchain version of traditional securities . Without diving into the details, these tokenized securities have the advantage of increased liquidity, quicker transactions, and lower costs. They grant you the stability of traditional assets while enabling you to pseudo-invest in blockchain technology by reaping its benefits.
So, if youre interested in blockchain, but the volatility of cryptocurrency still seems daunting, investing in blockchain-based traditional assets could be right for you.
Investing In Companies With Crypto Interests
Thats how personal finance expert Suze Orman initially did it. She recently told NextAdvisor about how she invested in MicroStrategy, a cloud computing firm that holds billions in Bitcoin, because its CEO was putting all of the companys working capital into Bitcoin. She figured if Bitcoin increased in value, so would the value of Microstrategys stock.
But as anyone who follows Ormans advice knows, she recommends index funds as a much better investment strategy than picking individual stocks.
Rather than buying shares in any single crypto-forward company, its better to maintain a balanced portfolio by identifying companies with crypto interests, and making sure their shares are included in any index or mutual funds you put money into. Not only does that allow you to invest in the companies where you see potential, but it also helps you keep your investments diversified within a broader fund.
If you invest with Vanguard, for example, you can use the sites holding search to find all the Vanguard funds that include a specific company. Just enter the companys ticker symbol and the tool will offer a list of all the Vanguard products that have holdings of its shares. Other investing platforms offer similar ways to search by company within index and mutual funds.
How To Buy Bitcoin
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Buying Bitcoin is often the first step that investors take into the world of cryptocurrency. And it can be an unfamiliar landscape for someone used to traditional financial products.
The value of Bitcoin the worlds first and most popular cryptocurrency has risen from $3,237 in December 2018 to the low five figures, though in 2022, Bitcoin’s value has trended downward amid the widespread crypto crash. Like all cryptocurrencies, Bitcoin is speculative and subject to much more volatility than many tried-and-true investments, such as stocks, bonds and mutual funds.
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Consider Storage And Digital Wallet Options
Crypto is entirely digital, so you need a digital place to store the coins you owe. One option, according to Feldman is your investment platform. As the cryptocurrency market has developed, most newer participants choose to store their cryptocurrency investments with the investment platform theyre using, Feldman explains. Make sure you choose a platform that will be responsible for custody and safekeeping of your assets that type of platform will be regulated, well-protected against hacking and cyber threats, and carry lots of financial insurance, says Feldman.
If you choose not to invest through the more popular platforms, youll need a crypto wallet these hold the private keys that allow you to access your crypto by unlocking the digital identity that is associated with your ownership, recorded on the blockchain. You can opt for either a hot or cold digital wallet. A hot wallet is accessible via the internet and is generally more convenient. A cold wallet is a physical storage device, much like a USB drive, that keeps your cryptocurrency keys completely offline and generally more secure.
What Are Some Applications Of Blockchain Technology
Blockchain technology can be used for anything that requires a digital, append-only, immutable ledger of transactions or data storage. This includes money transactions, real estate transactions, voting records, supply chain tracking, and more.
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Blockchain Is A Bet On The Future
If you invest in blockchain today, expect to wait a few years before it moves the needle on your investments. This technology is still ahead of its time. Companies and industries are still trying to figure out how, exactly, to use blockchain effectively. And while some are on the cusp of major breakthroughs, it could be a few years before they make it downstream, into the world.
The good news is that blockchain and cryptocurrencies are widely available as investment vehicles today. If you believe in blockchain, nows your opportunity to get in on the ground floor. Just make sure you have the risk tolerance to bear the bumps along the way to a future thats rife with blockchain innovations.
Is There A Better Opportunity
Investment is about finding the right opportunities at the right time. If you find yourself something better than what youre currently invested in, it might be a good time to take your crypto profits.
Ask yourself if youre willing to let go of your current investment in favor of rechanneling it towards something else. But, do remember the amount of profit you lose by going for option one and letting go of option two which involves the opportunity cost.
It could also provide insight into another characteristic that makes a cryptocurrency risky to employ in real-world transactions: cryptos volatility. Consider that you will be relinquishing your current cryptos potential profits and ask yourself if youre willing to take the risk.
This goes for investors with multiple investments as well. If you decide that youd rather have the time and money you spent on cryptocurrency invested in another opportunity , youll have to weigh the pros and cons as well.
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Investing In Cryptocurrency With Stash
Whether crypto leaves you feeling delighted or daunted, understanding how to invest in cryptocurrency opens up your options if you decide to explore this type of investment. With Stash, you can gain exposure to select cryptocurrencies through the Grayscale Bitcoin Trust and Grayscale Ethereum Trust , which are now components of Stash Smart Portfolios.
If youre a do-it-yourself investor who believes in the long-term potential of cryptos, you can browse Stashs crypto offerings directly to research and decide which investments are right for you. Our Crypto Calculator will help guide you against overexposed relative to the rest of your portfolio^ when purchasing cryptocurrencies.
Invest in crypto with confidence.
Invest with clear guidance and support, no matter what tomorrow brings.
Grayscale And Osprey Over
These investments are another attempt to get bitcoin into a fund-like vehicle. The trusts trade throughout the day, making it possible to bet on crypto without the hassles of buying, storing and safekeeping the coins or tokens themselves.
You can buy these in most investing accounts, and they are overseen by the SEC, adding an extra layer of security. However, you may pay a higher fee for this type of fund than for an ETF. For instance, Grayscale Bitcoin Trusts expense ratio is 2%, double what some popular futures ETFs charge.
Another issue is that the prices of these trusts dont always match the prices of the cryptocurrencies they own. While crypto futures funds also share this problem, it tends to be more extreme with over-the-counter trusts. Trey Barnes, a financial planner in Overland Park, Kan., says hes seen one popular fund, the Grayscale Bitcoin Trust, trade for prices as much as 33% below the value of the bitcoin it holds.
Of course, if you are a sophisticated investor, and willing to take on some extra risk, you may be able to use the price mismatches to your advantage. A discount kicks in when there are more sellers than buyers of the trusta scenario that could someday reverse itself. If you bought shares trading at a discount, you bought a dollars worth of bitcoin for less than a dollar, says Barnes.
Where to get started
Popular over-the-counter crypto trusts include:
- Grayscale Bitcoin Trust
- Osprey Solana Trust
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How To Invest In Crypto Without Buying Coins
The easiest way to get investment exposure to crypto without buying crypto itself is to purchase stock in a company with a financial stake in the future of cryptocurrency or blockchain technology.
But investing in individual stocks can bear similar risks as investing in cryptocurrency. Rather than choosing and investing in individual stocks, experts recommend investors put their money in diversified index funds or ETFs instead, with their proven record of long-term growth in value.
Believe it or not, most individuals with a retirement plan or an investment portfolio allocated in an index fund already have some exposure to crypto, says Daniel Johnson, a CFP with ReFocus Financial Planning.
Many of the best index funds like S& P 500 or total market funds include publicly traded companies that have some involvement with the industry by either mining crypto, being involved in the development of blockchain technology, or holding significant amounts of crypto on their balance sheets, says Johnson.
For example, Tesla which holds over a billion dollars in Bitcoin and accepted Bitcoin payments in the past is included in any funds that track the S& P 500. Since its 2020 inclusion, its become one of the most valuable, and therefore influential companies in the index. And Coinbase, the only publicly traded cryptocurrency exchange, is in the ARK Fintech Innovation ETF.
Cons Of Investing In Cryptocurrency
- The cryptocurrency market is highly volatile it can be difficult to predict when values will rise or fall, and the drivers of large swings in value may not always be clear.
- Though crypto blockchains are very difficult to hack, individualscan be susceptible to hacking, due to the same risks inherent in any online activity.
- Cryptocurrencies are not currently subject to much government regulation, so transactions dont come with legal protection.
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Protecting Yourself While Investing In Cryptocurrency
You must take extra steps to protect yourself and your capital with any investment type. There are a few common concerns when it comes to cryptocurrency: credibility, security, privacy. Many investors are skeptical of crypto platforms and are hesitant to start investing.
A great way to mitigate these concerns is by thoroughly researching the crypto you want to invest in and whats behind the platform. Look up who owns the marketplace you are interested in and gather more information about them. Research how old the company is and in what stage of development the platform is in.
Cryptocurrency is unfortunately susceptible to hackers and other technical issues that simply dont impact other investments as frequently. For this reason, it is crucial that you fully understand the marketplace you choose to work with.
It is not uncommon to choose platforms high profile investors are known to work with as a starting point. This, along with a sound company structure, can help serve as a sign of stability for that marketplace.
As you continue to learn how to invest in cryptocurrency, take the initiative to read the fine print before you start an account. The companys prospectus will provide you with insight into the companys inner workings. This information can help provide you with peace of mind and let you know exactly how secure your investment will be.
Pure Blockchain Technology Play
Pure blockchain technology plays are available.
A number of established companies including Intel Corp. and IBM Corp. are making significant investments in blockchain technologies for broad use by various industries. These can give investors a foothold in the space without betting the farm on it.
Others, like Galaxy Digital Holdings and Silvergate Capital Corp. are all-in on cryptocurrency and blockchain technology.
If you want to keep your level of risk relatively low, the best option is to invest in one of the stocks issued by a major financial services company experimenting with the potential of blockchain technology for improving services, or a technology company investing in broader applications for blockchain services.
For investors who are able to tolerate a higher degree of risk, investing in one of the pure blockchain technology investment opportunities could deliver the right combination of risk versus potential return.
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Best Online Brokers For Blockchain Stocks
The best online brokers for blockchain stocks that trade on the major exchanges include TD Ameritrade and E*TRADE, but any major broker that has access to U.S. stock markets would be adequate. For OTC and penny stocks, you might want to check out Charles Schwab, Interactive Brokers, TradeStation or Fidelity. A comparison of some of the best online brokers for blockchain stocks appears below.
- securely through CenterPoint Securities’s websiteMore Details
- securely through IBKR Stocks’s websiteMore Details
- securely through eToro Stocks’s websiteMore Details
Benzinga is compensated if you access certain of the products or services offered by eToro USA LLC and/or eToro USA Securities Inc. Any testimonials contained in this communication may not be representative of the experience of other eToro customers and such testimonials are not guarantees of future performance or success.
Is Jeff Browns Gte Technology Legit
Jeff Browns GTE Technology is a legit presentation because it is being promoted by Jeff Brown, the chief investment analyst for Brownstone Research. I think Brownstone Research is a legit investment research firm and Jeff is legit.
He is a legit guru with a degree in aeronautical and astronautical engineering and decades of experience working in the technology industry under his belt.
Jeff makes some bold predictions about the amount of money he expects to flow into the GTE and that will have made you doubt the viability of his claims. However, this kind of talk is common with newsletter gurus as they sell you a newsletter. This is why you should take every word he says with a grain of salt.
Another question that comes up frequently is: What is Jeff Browns Net Worth? It is hard to tell because there are no reliable sources for that kind of info, but he is probably worth a couple of million dollars.
That being said, beneath the hyperboles and the grand claims, there is a legitimate investment opportunity that could even take a couple of years to be profitable. The NFT craze has proven that tokenization is not just a fad.
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Companies Developing Blockchain Uses
You can invest in several companies researching and developing blockchain and DLT products and services. Many well-known companies such as IBM and Nvidia are developing blockchain use cases, and many more are emerging in the public and private markets. There are several markets you can choose from:
Overview: Blockchain Penny Stocks
Blockchain technology, the use of digital time stamps for ordering transactions, has been around since 1991. Researchers W. Scott Stornetta and Stuart Haber were looking for a way to create better document timestamps, but blockchain first produced a widespread real world utility as the underlying framework for Bitcoin in 2009. Not too long later, as an objectively better way to record transactions and prevent fraud, the concept of the blockchain is already a part of many mainstream companies behind the scenes.
Identifying when the first blockchain stock appeared is difficult. As Bitcoin began to expand, many small tech companies already on exchanges simply slid over into researching and producing blockchain technology. It is also true that many penny stocks who claim blockchain are using the lexicon strictly for marketing purposes. Speculative tech is a relatively unregulated business space that many government regulators dont even have the training to understand.
The first well-publicized blockchain stock offering was conducted by Overstock in 2016. The first blockchain ETFs showed up in the U.S. in early 2018 following the Q4 2017 Bitcoin mania . Since 2018, the crypto securities market continues to expand as cryptos market cap consolidates between a range of $150 billion and $330 billion.
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What Industries Will Benefit From Blockchain
Nearly every industry will benefit from Blockchain because its a more efficient and more secure way of storing data. The vast majority of businesses need some sort of data storage solution, and blockchain technology can fulfill that need.
However, if youre looking to invest in blockchain now and wondering which industries will adapt first, it will likely be banking, healthcare, logistics, supply chain, and data storage. Any companies that manufacture hardware will also be a boon to investors.
Also keep a lookout in the news for developments around the digital dollar and the already-extant digital yuan because once governments and their central banks create their own forms of digital currency, you can bet that they will outsource most of the work to contractors from the private sector, such as Accenture and Taiwan Semiconductor.