Blockchain & Cryptocurrency Investment Alternatives

Although the gains could be huge, so could the losses.  Some of us, though excited about being part of the revolution, aren’t yet ready to dip our toes into such fiscal volatility.  If you are one of those people, or if you are just interested in looking at some alternatives to the normal cryptocurrency and blockchain investments, you may find the following worthy of consideration:

Exchange Traded Funds  

This is the fourteenth section of the Cryptocurrency and Blockchain awareness programme, How to Crypto.

ETFs are very popular and they provide a safer option for exposure to hundreds of individual investments all at once. The most popular ETFs are indexes or collections of the most popular or highest market cap funds which allow you to invest and help you spread the risk.  They aren’t likely to be the highest earning alternatives to direct crypto investment, but they are certainly less risky.

Unfortunately there isn’t yet a Bitcoin ETF.  It is widely believed that the Bitcoin price will skyrocket when one is actually allowed in the USA because many people who want to invest in Bitcoin wont do so without the safer ETF investment mechanisms. Until then, you will need to use Canadian, Australian or European Bitcoin and crypto ETF’s which aren’t quite as popular. The U.S. Securities and Exchange Commission (SEC) is considering such options with many proposals in review.  It’s going to happen, we don’t yet know when.  Soon.

Cryptocurrency Alternatives – Crypto Stocks

If you aren’t sure about directly investing in crypto coins, tokens or ETFs, why not consider the stocks and shares of companies that are already invested.  The following are the most popular:

(NASDAQ: COIN), a top cryptocurrency trading exchange, made its initial public offering (IPO) in April 2021. The company is a popular platform to purchase major cryptocurrencies such as Bitcoin, Ethereum, and Cardano (CRYPTO: ADA), and it allows users to trade more than 160 altcoins.

The Coinbase platform’s success has been contingent upon the increase in crypto prices — which, in turn, has led to millions of new users creating accounts. It is high on the list of alternatives because Coinbase earns a small transaction fee every time someone places an order to buy or sell a cryptocurrency.

(NVDA). This company designs and sells graphics processing units (GPU’s), the heart of the systems used to mine cryptocurrency. They are best known for powering high-end video game graphics, GPUs but they also enable computing-intensive services such as data centres and cryptocurrency mining rigs with their advanced hardware.

PayPal (PYPL). This is a very popular online money-transfer company. It’s payment platform is almost a household name. They recently expanded their services to allow customers to buy and sell select cryptocurrencies with their PayPal and Venmo accounts.  This was initially tried in just the US but is gradually being rolled out globally.

(MSTR) MicroStrategy offers business intelligence and cloud services, and invests its assets into Bitcoin at a huge rate!  MicroStrategy is one of the world’s largest holders of Bitcoin.

BLOCK (SQ) (formerly SQUARE) . This payment services provider for small businesses has purchased over $220 million in Bitcoin since October 2020. In February 2021, the firm disclosed that Bitcoin made up around 5% of the cash on its balance sheet. In addition, Square’s Cash App allows people to buy, sell and store cryptocurrency.

These are just a few, there are many other alternatives to cryptocurrency.  Such as companies that are investing in cryptocurrencies as a hedge against inflation. TESLA and MicroStrategy are just two of a growing number to do this.  TESLA’s CEO, Elon Musk has recently taken things a little further with the takeover of Twitter and his media promotion of the memecoin, Dogecoin.     

Cryptocurrency is notoriously volatile and  a single tweet from an influencer can make the prices plummet (or skyrocket!).  Investing in alternatives such as companies closely related or invested in crypto may also see price volatility.  It is thought however, that this would be at less risk.  

In the next section, we look at how to secure your cryptocurrency as there are currently now reputable, affordable custodial services that can protect your investment for you! Section Fifteen: Crypto Security, Protecting Digital Assets

 

This article is copyright 2022 by Tony Fawl, CryptoNET.

This page is part of the How to Crypto Web Series, an awareness course for beginners interested in blockchain projects and cryptocurrency investment. Please checkout the Bibliography and Glossary of Terms pages for other useful resources and links. To find out what we do, take a look at the About Us page.

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