This article was first published on SALT Lending Official Blog - Medium
Crypto — Coming Into Its Own
A look at indicators of industry maturity and assessing the right kind of investment risk.
(This article is adapted from a keynote speech delivered at the April, 2019 Crypto Invest Summit.)
I often get asked, whether it’s by former colleagues, or people I meet at social events, or even my dad, “Why would people invest in crypto? It seems risky.”
Depending on your investment strategy, sure, it’s risky.
But…it’s a different kind of risky than it was even two years ago.
So, what’s changed?
Crypto asset performance isn’t correlated to any other asset class. It doesn’t move with fiat inflation or commodities prices. It’s not tied to the performance of a company like a security. That inherently creates risk but also opportunity for significant gain. This is a risk that we as an industry weather and accept.
The perceived risk my dad is referencing has less to do with crypto asset volatility and more to do with the perception that the crypto industry reflects the lawless, undisciplined behavior and unbridled speculation akin to the caricature of the wild west.
This perception is inaccurate.
I was having a conversation with a colleague about this very topic and he said,
“Our industry isn’t in a state of chaos like The Wild West. Our industry is more analogous to The Space Race.”
John F. Kennedy said of The Space Race, “We choose to go to the moon in this decade and do the other things, not because they are easy, but because they are hard.”
Blockchain technology attempts to solve previously unsolvable problems. The complexity of the technology and the nascent nature of the regulatory framework, requires new and emerging expertise....
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SALT Lending Official Blog - Medium