Is It Early or Too Late to Invest in Bitcoin: Wells Fargo Has 3 Tips for New Crypto Investors
US-headquartered banking giant Wells Fargo has three tips for new cryptoasset investors, with a recent report released by the bank’s Investment Institute answering the question that many ask themselves: is it too early or too late to jump on the crypto train? The report's authors advise new crypto investors to be patient, prudent, and careful.
There is no need to rush with crypto investments, as most of the opportunity lies before investors, the analysis says.
In its evaluation of the “too late to invest” argument, the study points to the fact that bitcoin’s price has compounded at a 216% annual rate since the crypto’s first recorded transaction in 2010. In contrast, over the same period, the total return of the S&P 500 index has compounded at 16% per year.
"We understand the 'too late to invest' argument but do not subscribe to it," the institute said. "We believe that focusing too much on past performance, especially with cryptocurrencies, can be misleading to new investors. [P]erformance numbers are skewed because most cryptocurrencies evolved from virtually zero."
The authors say they see cryptoassets in the “early, but not too early” investment stage, which is why they emphasize the need for investor education, as investment options are a bit behind and continue to mature.
The authors went on to compare three main ways to gain exposure to crypto:
The analysts concluded that they are looking forward to regulators approving option 2, but, unsurprisingly, until that day comes, the provider of financial services itself recommends option 3: “We recommend professionally managed private placements for now, as the investment landscape is still maturing.”
The bank’s analysts argue that crypto users are growing globally and
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