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Crytocurrencies demonstrate incredible profitability

Since the market collapse in March caused by the COVID-19 pandemic, the price of a Crypto.com Coin (CRO) token went up from $0.026 to $0.125, bringing investors five times more profit in less than four months.

An even more profitable token is Aave that jumped from $0.016 to $0.148. This instrument returned 825%, increasing the original investment more than nine times, RBC reports.

It would be early to claim that cryptocurrencies can be a safe asset although some altcoins did continue to grow when stock indices, exchange rates and commodity rates were falling, commented AMarkets Analytics Director Artem Deev.

All the forecasts concerning digital currencies are currently divided into two perspectives. Some investors are predicting that the popularity of cryptocurrencies will grow noting that it was during the crisis that many market participants started investing in bitcoins and altcoins.

The other forecasts focus on the fact that the bitcoin’s dynamic is closely linked to S&P 500. Its price follows the index’s fluctuation, the expert explains.

“Therefore, we should see cryptocurrencies as only one investment option during a crisis, invest only part of the money in bitcoins and altcoins and monitor the markets carefully,” Artem Deev recommends. “If there is a second wave of the pandemic, it is quite possible that the rates will go down (especially it is true for bitcoin) like other indices (oil prices, stock indices and EM currency exchange rates). The cryptocurrencies should not take up more than 15% or 20% in the portfolio. The major part of the funds should be invested in foreign currencies and precious metals.”

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