As soon as cryptocurrencies like Bitcoin slump, negative bears come out of the woodwork to proclaim further drops. That has not been the case. After each mild correction, bitcoin consolidated and rallied to new highs. Investors new to the cryptocurrency markets must watch out for the euphoria ending abruptly.
Endless monetary easing, low-interest rates, and excess government spending is eroding the value of real-world cash. Investors are seeking safety in crypto. Crypto exchanges are thriving. Voyager Digital (OTC:VYGVF) bottomed at around $9 just a month ago to peak at $20.00. The company posted revenue of $175.06 million, although it lost 39 cents on a GAAP basis.
Robinhood (NASDAQ:HOOD) started the development of a cryptocurrency wallet. In addition to revenue growth from stock trading, crypto demand will add to Robinhood’s operating earnings.
Coinbase (NASDAQ:COIN) stumbled slightly after posting Q3 results. Its revenue did not meet consensus due to lower activity in the cryptocurrency market.
Investors have no idea when the euphoria for crypto will end. They cannot ignore the sector, either. If crypto prices dip, find out what is driving the decline. Stiff government regulations on the currency would justify a small correction. Conversely, any wild swings without meaningful news are noise.
Investors cannot afford to avoid the sector. Holding a very small allocation to start a position would minimize the exposure and risks in this market.
