Why most of the investments are going into crypto currencies ?
Increased demand from institutional, corporate, and more recently retail investors has powered bitcoin's surge. Bitcoin jumped more than 5 percent on Friday to fresh record highs of $41,530, reversing losses from earlier in the session. Bitcoin fell more than 5% on Friday, a day after topping $40,000 for the first time.
At the same time, Rival cryptocurrency Ethereum sank more than 10% to as low as $1,087.Interest in the world's biggest cryptocurrency soared last year, with investors viewing bitcoin as a hedge against inflation and an alternative to the depreciating dollar.
America’s largest bank and the world’s most popular social network, two companies with multi-billion dollar market caps, announced courageous forays into the cryptocurrency industry earlier this year. JPM Coin and Facebook’s Libra are expected go a long way towards legitimizing the cryptocurrency market in the eyes of the public.
Cryptocurrency and Blockchain are the next big things to discuss on the board and sources said, few top business houses in India are planning to come up with their own cryptocurrencies. Even outside of the cryptocurrency market, investor interest in the underlying blockchain technology continues to rise by the year.
Blockchain has found a plethora of use cases in industries ranging from insurance to supply chain. Going forward, the cryptocurrencies to be used as a commodity.
Investors are saying, the negative interest rate by the Financial institutions and specially in India the growth of investment looks towards the positive trend, lead the investors to think of moving to invest into crypto currencies, since it attracts by the prospect of quick gains in a world of ultra-low yields and negative interest rates.
The digital currency has emerged as a rival to gold and could trade as high as $146,000 if it becomes established as a safe-haven asset.
"We are seeing a continued demand spike driven largely by sustained and unprecedented institutional interest, showing no sign of abating as we move into 2021," said Frank Spiteri of digital asset manager CoinShares.