Wealthy Investors Moving Towards the Cryptocurrency Market

There are several rich investors that are interested in cryptocurrencies. The volatile cryptocurrency market is a great option for individuals that like important swings in prices. Besides that, investors that want to diversify their portfolios, may be looking for the disruptive asset that would potentiate their investments.

Increased Interest in Cryptocurrencies

According to the latest annual Wealth Report survey, conducted by Knight Frank, 21% of private bankers said that their clients have decided to increase the cryptocurrency investments in their portfolios during 2017. But one of the main problems of these investors is that they do not understand blockchain and how these new currencies work. 

About this situation, Nicholas Holt, Knight Frank’s head of research for Asia Pacific commented during an interview with CNBC that people is investing in cryptocurrencies but there is not a full understanding about what that can mean for their portfolios.

Some experts have been warning about the risks of investing in digital currencies like Bitcoin or Ether. The markets are very volatile and sometimes are influenced by fake news or insider trading.

At the same time, other investors are searching for more volatile assets to increase their profits. When the stock market is flat and does not produce any important movement or action, they try to find riskier assets to generate more profits and trade during the swings.

Knight Frank’s report reads as follows:

“In recent months, crypto markets have faced increased government regulation, including a few outright bans on trading digital currency, alongside negative comments from crypto sceptics, including Berkshire Hathaway Inc., Warren Buffet and JP Morgan CEO Jamie Dimon. Despite the criticism, digital currencies such as Bitcoin, Ethereum and Ripple have made their way deeper into the mainstream, making a major win with a debut on the futures market in the U.S.”

Important enterprises are investing in Bitcoin and other cryptocurrencies. Rich individuals are also placing their funds in the market. Among these investors we find Michael Novogratz and Bill Miller. Additionally, some weeks ago, an anonymous trader bought $400 million dollars in Bitcoin.

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