Why Are Major Finance Companies Still Moving Into Crypto During the Downtrend?
This is a question that I was asked today by someone that invests primarily in stocks because he legitimately doesn’t understand the world of crypto. Every couple of months, he checks in with me to see how the crypto market is doing, flirts with the idea of investing, and then doesn’t actually invest. Anybody else have experience with friends like this?
I always answer his questions and tell him briefly that I am still in the market because of the technology/projects that are going on then we both go our separate ways for a time.
But, he does bring up a good point so I wanted to address it.
Build in the downtime to catch the ride up
From a business perspective, it makes sense to build a business when the market is down in an industry that was previously thriving and has a decent track record of growth.
Crypto ticks both of those off the list in my mind.
If you focus on building when the market is down and no one is really paying attention that industry, you will be working in relatively quiet conditions and don’t have anyone really breathing down your neck demanding innovation (unless you count the investors that hold for the long term).
When the market starts to take notice of your industry again, mostly in thanks to the technology built during the downturn, your company would be in prime position to take advantage of the upswing.
Businesses taking advantage of this time
Goldman Sachs announced August 6, 2018 that they plan to offer their clients custody for crypto funds but remains undecided on their crypto plans at this point.
They indicated that there has been client interest in cryptocurrencies so they are trying to take advantage of that.
“Having a custody operation in place could also lead to other ventures, including prime-brokerage services,” Bloomberg added, paraphrasing the sources.
My last post was about Intercontinental Exchange (ICE) announcing a partnership with Starbucks via a brainchild that they’re calling Bakkt. Read the post here.
Michael Novogratz, founder and CEO of Galaxy Digital and former hedge fund manager, launched Galaxy Digital on the public exchange on August 1, 2018.
This was deemed a risky move by many critics but Novogratz made comments publicly that if he had known the market was going to be down for this long he may have waited longer to launch but he doesn’t have regrets that he ended up launching now because he believes in the long term viability of the crypto market.
Novogratz has been a huge public supporter of crypto and has been outspoken in his opinion. He is a face for cryptocurrency in the public sector and has given many television interviews on his prediction for the marketplace as well as the avenues of future technology within the space.
We have seen many public faces of celebrities like Floyd Mayweather and the Kardashians look at crypto as a viable investment and this has given the public a look at crypto that may not have been possible otherwise.
Crypto prices are down right now and have been down for months but there have been so many developments in the space like new technologies and new voices for the community that have had huge impact on the possibility of mass adoption by the public. And mass adoption would likely mean exponential growth in the marketplace.
I would love to hear your opinion and thanks so much for reading!