Crypto Gurus: Bitcoin investments, crypto domination and ETF

Crypto Gurus: Bitcoin investments, crypto domination and ETF

Three well known analysts and personalities talked about the crypto market this week as they were offering their vision about three aspects of the blockchain and digital currencies world.

Mohamed El-Erian, Brian Kelly and SEC’s chief Jay Clayton talked about blockchain dominance, cryptos recent rollercoaster and investments, and Bitcoin regulation and ETFs.

Cryptos will gain even more popularity, but it will not be dominant

Famous analyst and Allianz chief economic adviser Mohamed El-Erian believes that cryptocurrencies will gain popularity in the years to come, but it will not be the standard asset.

In a conference in New York, El-Erian said he thinks “cryptocurrencies will exist and will become more and more widespread, but they will be part of an ecosystem,” not the system itself.

“They will not be dominant as a lot of the early adopters believe they will be,” El-Erian highlighted.

The analyst considers that the great recession paved the way for the irruption of cryptocurrencies as people lost their confidence in the financial system, so they started to look for different options to store their capitals.

“I do not think we would be up here on stage today if there had there not been a shock to the trust in the way the economy works,” said El-Erian. He also commented the cryptos industry is still an immature market. “It is just finding its place in the ecosystem.”

Cryptocurrencies should be part of an investor’s portfolio

“Bitcoin last two-year rollercoaster is similar of what the crypto king performed in the periods 2010-2012 and 2012-14, “a very, very similar move. We saw a huge run-up, just like what we saw this time last year, and then a sell-off again, and it repeated again,” said Analyst Brian Kelly in an interview to CNBC’s Power Lunch.

Kelly, Founder and Managing member of Brian Kelly Capital and CNBC Contributor commented that current Bitcoin situation is very similar of previous runs and falls, “it doesn’t feel very good, but people need to remind themselves, that this is the most risky thing you can do with your money, it’s cutting-edge technology, and it would be extremely volatile.”

According to Kelly, the pessimism today is a mirror image of the euphoria of last year. “Bitcoin should be at least a small part of an investor’s portfolio,” says Kelly. Investors should understand that these volatile assets must be sized correctly in their portfolio. “One to five per cent of institutional portfolios are going to this kind of assets class.”

SEC wants better surveillance and custody for cryptocurrencies before ETFs

SEC Chairman Jay Clayton wants to see more control and monitoring into the cryptocurrencies industry before approving a Bitcoin ETF as he said at CoinDesk’s Consensus Invest conference in New York.

It seems the first ever bitcoin exchange-traded fund will have to wait until the SEC finishes most of their investigations and regulatory framework as SEC chairman Clayton said the crypto market needs more surveillance and monitoring tools like the ones used in stocks, before having the ETF approval.

“What investors expect is that trading in the commodity that underlies that ETF makes sense and is free from the risk of manipulation,” Clayton said. “It is an issue that needs to be addressed before I would be comfortable.”

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