Investment Management in Crypto

Cryptocurrencies are becoming increasingly popular as solid regulatory frameworks and the availability of coins, trading platforms and blockchain-enabled technology drive investor interest. The overall rise in popularity comes at a time when conventional investment diversification is facing challenges. This buzz surrounding cryptocurrencies could lead someone to make a rash decision from an unverified tip, or wait in the wings too long and miss out on significant returns.

Whether you have heard about an up-and-coming altcoin that could offer great returns, or have concerns about the volatility of a particular asset, you should always approach any investment decision with a degree of informed caution. At Delchain, we advise high-net-worth individuals on their crypto investments every day, and we wanted to share some critical advice with all our readers. 

Educate Yourself on Cryptocurrencies 

If you’re expecting to work with a third-party investment service like ours, it’s advisable to spend some time establishing a baseline understanding of the market. That’s because your financial planner should be presenting investment opportunities that you ultimately need to greenlight. Without a basic crypto education, you’re placing 100% of your trust in the hands of a third party. 

We want all our investors to be confident in their choices, which is why we aim to educate at every stage of the process. We believe that transparency and education leads to better investment decisions and higher client satisfaction. It doesn’t hurt to get started with reputable publications such as The Daily Hodl, CoinDesk, and CoinTelegraph who offer the latest news and insights on cryptocurrencies. 

Why Investment management in crypto is the way forward

The fact that cryptocurrencies remain a topic of debate among financial practitioners suggests that there will be continuing volatility in crypto-related assets in 2021. However, despite the volatility in the market, its size will continue to grow – the current crypto-asset market is worth $200bn, compared to $18bn at the beginning of 2017. There have also been 500 funds launched in the distributed ledger technologies (DLT) and crypto-assets sector in the past three years.

Cryptocurrency transactions are independently and publicly validated by each network node, which lessens the likelihood of fraud. Processing costs are also low because there is no need for disintermediation. The concept of a fixed or limited supply of some coins can allow them to accrue value, even as blockchain networks become more complex.

Financial regulatory bodies have been reviewing crypto in countries around Europe. In Germany, legislation has been proposed to enable banks to handle cryptocurrencies, and Switzerland has led the way in establishing crypto exchanges. High-profile institutions such as JPMorgan Chase, BNY Mellon, and Goldman Sachs are also taking the sector seriously.

Manage Your Risk Vs. Returns 

Crypto assets are always prone to volatility, which means the risk and the potential returns are greater. Crypto investors who have been buying and selling in the market for years are more likely to be open to coins with aggressive returns. 

Although such returns are attractive, these investors also invest a significant amount of time scouting the market and checking rates 24/7. By choosing less aggressive coins or working with a third party, you can obtain a more passive strategy that doesn’t demand you stay up all night monitoring market fluctuations. 

If this sounds like a win-win situation to you, contact Delchain now and let us explain how our crypto investment management services can help you reach your financial goals.

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The information, tools and material presented in this report are provided to you by Delchain Limited for information purposes only and are not to be used or considered as an offer or the solicitation of an offer to sell or to buy or subscribe for securities or other financial instruments.  Delchain Limited may not have taken any steps to ensure that the securities or financial instruments referred to in this report are suitable for any particular investor.  Delchain Limited will not treat recipients of this report as its customers by virtue of their receiving this report. The investments and services contained or referred to in this document may not be suitable for you and it is recommended that you consult an independent investment advisor if you are in doubt about such investments or investment services. Nothing in this report constitutes investment, legal, accounting or tax advice, or a representation that any investment or strategy is suitable or appropriate to your individual circumstances, or otherwise constitutes a personal recommendation to you.  Delchain Limited does not advise on the tax consequences of investments and you are advised to contact an independent tax adviser.

Information and opinions presented in this document have been obtained or derived from sources believed by Delchain Limited to be reliable, but Delchain Limited makes no representation as to their accuracy or completeness.  Delchain Limited accepts no liability for loss arising from the use of the material presented in this document, except that this exclusion of liability does not apply to the extent that such liability arises under specific statutes or regulations applicable to Delchain Limited. This report is not to be relied upon in substitution for the exercise of independent judgment.  Delchain Limited may have issued, and may in the future issue, other communications that are inconsistent with, and reach different conclusions from, the information presented in this report.  Those communications reflect the different assumptions, views and analytical methods of the analysts who prepared them and Delchain Limited is under no obligation to ensure that such other communications are brought to the attention of any recipient of this document.

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