Why Should You Consider Investing in Digital Assets?

A digital asset is anything that is stored digitally and is uniquely identifiable that organisations can use to realise value. Examples of digital assets include documents, audio, videos, logos, slide presentations, spreadsheets and websites.

The digital world has paved the way for many new investments to come, including the crypto world. Cryptocurrency has transformed from what once used to be known only as Bitcoin to a trending topic in 2022.

Shortly after the recession began in 2008, Bitcoin was the first cryptocurrency to launch in early 2009. While it remained quite a mysterious thing for many years, it has managed to break out of the ice. As a result, investors are now turning more than ever to cryptocurrencies, and it’s becoming a profitable market to invest in.

Don’t go anywhere because, in this article, we will discuss which digital assets are the best ones you can invest in.

Should you expand your investment portfolio?

Expanding your investments in different sectors helps you reduce investment losses and helps you with the natural fluctuations that happen in the market.

Moreover, it’s unlikely that every marketing- stocks, bonds, real estate, crypto, and more- will hit rock bottom simultaneously; the more you diversify your investment portfolio, the better it is for you and for reducing your overall losses.

An investment portfolio should be well balanced and contain a mix of digital assets that investors need to meet risk tolerance levels and the goals they are trying to achieve.

Investment portfolios balanced out and have a great blend of assets will lower risk levels and generate higher returns compared to only investing in one asset in your investment portfolio. Studies themselves have shown this to be accurate, and the most important thing to know is that you don’t need to be an expert in investing to generate high returns. Instead, your goal should be to balance out risk and reward levels.

Why should you consider investing in cryptocurrencies?

The booming sector

Digital assets like the crypto world have become part of the “booming” sector, which means that we see a considerable increase in returns in a short period of time. However, due to the start of the global recession, the crypto market has staggered. As a result, the prices of cryptocurrencies are lower, but at the same time, this is an excellent opportunity for you to invest and generate higher returns when they go back up.

For example, let’s take Bitcoin for instance; several years ago, it had a price of only $7,000, but in late 2021, Bitcoin managed to hit all-time highs of more than $60,000. So, in general, the crypto market is a booming industry and managed to hit all-time highs and generate multiple levels of returns.

Excellent returns

Many traditional investors will underestimate the power of cryptocurrencies, but the amount of returns it generates is insane. Of course, not every cryptocurrency will generate the same amount of returns, but it’s worth it if it’s a profitable coin to invest in. For example, a few years ago, Bitcoin was worth a couple of thousands of dollars, but now, it is worth more than $30,000. Imagine if you had invested $1,000 while the price of Bitcoin was worth that amount; you would now have more than 30 times the returns.

You don’t have to invest large amounts of money in the crypto world. But, especially if a coin is rising in value, it is your opportunity to take advantage of it. Depending on the platform you invest in, you can buy USDT with a credit card or debit card and convert them to the cryptocurrency you are looking to invest in. Of course, each platform will have different transaction fees, so this will vary from each platform.

Exchange-traded funds (ETF) and fund managers

There are several methods to leverage crypto investments and yield models, such as crypto staking, crypto loans, yield farming, and more. However, fund managers are most commonly the best way to enter these spaces because crypto investment fund managers have a high range of products specially designed for family offices and even institutional investors.

Moreover, fund managers will offer funds with fee structures, minimum investments, and even liquidity schedules. They include passive or active management regarding cryptocurrencies, venture funding, and more.

Exchange-traded funds effectively reduce crypto investments’ risks, challenges, and burdens. ETFs are an excellent way of gaining access to portfolios for investing in cryptocurrencies, blockchain technology growth, and directly investing in cryptocurrencies.

Some fund managers and EFTs you can consider using for investing in crypto are:

  • Bitwise 
  • Pantera
  • Multicoin Capital
  • Pecunio and more 
  • Wallets and brokers 

A common approach for investing in cryptocurrencies is using digital wallets. These wallets are special digital tools that will safely store your digital assets. These wallets allow you to buy and sell cryptocurrencies and are easy to install. All you have to do is install an app with a crypto wallet. For example, Binance has a wallet stored within the app itself, Coinbase has a separate app that you can download within the app, and trust wallet is a popular app you can download from the play or app store.

Moreover, a broker promotes the same idea. Similar to a digital wallet, you can buy and sell crypto. However, with a broker, these types of services are primarily included on browsers rather than mobiles. In addition, brokers offer trading options for larger cryptocurrencies like Bitcoin, Ethereum, and more.

Digital assets are becoming modern-day investments

We aren’t in times where wealth is pre-determined if you have gold or land. Today, wealth is determined by how well you can keep up with technology and how well you take advantage of investment opportunities. Moreover, we don’t know what might happen in the future, but digital assets might take over physical assets if they become so popular that they will be used as the main currency.

For instance, cryptocurrencies aren’t physical currencies and can only be converted into cash in, which you can use. However, traditional investors still oppose virtual currencies and think they aren’t a currency that the majority might use. However, according to statistics, nearly 20000 businesses accept cryptocurrencies as payment methods, which is growing. Therefore, you have nothing to lose if you take advantage of it from now on.

Of course, if digital assets become more commonly used and are accepted by a larger number of companies worldwide, most popular cryptocurrencies will also rise in value, which will be in your favour.

It might not be a favourite for traditional investors, but those who invest in digital assets will have an advantage over the rest.

A better option for the environment

Cryptocurrencies can’t be held physically compared to physical assets, so they offer a whole new digital ecosystem. This is an excellent alternative to the environmental crisis that is going on in the world right now.

Alternatively, aside from cryptocurrencies, we also have non-fungible tokens (NFTs), becoming increasingly popular alongside cryptocurrencies. Also, you don’t always have to invest in cryptocurrencies, but you can start getting involved with NFTs, or even coin mining, which is similar to crypto investing.

Passive income

We mentioned everything, but the fact that digital assets are an excellent option for earning passive income is the best thing about it. If you are working at a full-time job or even doing something else, investing in digital assets can be your side hustle and allow you to accumulate money in the long and short-term, depending on where you are investing your money.

You don’t need to really break a sweat except for reading about where you will invest your money and let the market do the rest of the work over time.

The final word

That’s all on this article. This is all we had to say about digital assets and the crypto world. Even though traditional investors might be against digital assets, it doesn’t mean they are right about what they are saying. Nevertheless, the world is continually evolving, so we must ensure we are up to date with everything.

Even though physical money is still the dominant payment method, we never know what the future holds, so if you have digital asset capital from now, they’ll be even more valuable in the future for you. First, however, never forget to do your research. A failed investment does not have enough research, and even though we can’t predict what will happen, it’s better to have your research statistics done right.

Take time to read through the type of investment you’ll make and diversify your investment portfolio. Of course, you don’t want to invest your money into something risky!