Hop on board the cryptocurrency freight train!

Cryptocurrencies are here to stay and getting educated on them will change the way you think about money and investing. As someone who spends a significant amount of my time in both Singapore and the USA, I always have a more difficult time convincing citizens of rich 1st world countries why they should be investing a small percentage of their net worth in cryptocurrency. Because their local currency has been relatively stable for most of their lives, they feel more comfortable with their US dollars and Singapore dollars, primarily because it is what they have grown accustomed to. However, I believe getting educated and participating in this new era of investing is a huge opportunity that every person should partake in before cryptos go mainstream.

Here are four main reasons why cryptocurrency is coming like a freight train to take significant market share away from fiat currencies.

1. Once you learn the basic skills to send and receive cryptos, you almost find it laughable how troublesome and time consuming the process use to be with the banking system. Moving digital currency from one person to another is super easy, no matter what country each person resides. I can be in almost any country in the world and transfer digital money to a citizen of any other country. It is fast, easy, and secure. Dealing with banks is a pain, especially for US citizens who have to jump through hoops with all the cumbersome regulation.

2. Many countries have seen their currencies devalued and therefore, do not trust their local currency. At one point during 2016, the Argentinian government annualized inflation rate was more than 1000 percent. Everyone knows what happened in Cyprus where depositors got money taken from their bank accounts. Greece, Venezuela… the list goes on and on, proving that governments and central banks all over the world have the ability to manipulate the value of their currency. Will the Euro even be around in ten years? It is a toss up. And the almighty dollar? Ninety percent of the 10.5 trillion USD in existence are in digital form already. Many people also forget, but the US government does have a history of confiscating assets from citizens as well. Executive Order 6102, which was signed on April 5, 1933 “forbid the hoarding of gold coin, gold bullion, and gold certificates within the continental US”. And does the US government really have the ability to pay back all the debt it has accumulated? Even an amateur doing basic research into the finances of the government knows it is highly unlikely the government will pay back their debt and outstanding obligations. Printing more and more money while keeping interest rates near zero is just creating another massive debt bubble, but this is a discussion for another time. There is also a war on cash brewing all around the world, which is helping to push decentralized digital currency to the mainstream even faster.

3. Billions of dollars have been invested into this new asset class because it is a major disruptive technology. Many governments and the largest, most powerful companies in the world have already recognized the value of the blockchain (which is the digital ledger in which transactions are recorded chronologically and publicly.) In addition, dozens of new hedge funds are in the pipeline eager to start investing in this new asset class.

4. This is not just a digital currency fad. We are in the midst of a true paradigm shift in money and banking. Yet, this just scratches the surface of what cryptocurrency has the ability to do. The blockchain technology can also utilize smart contracts to verify and enforce negotiation and performance of contracts, thereby offering a better, faster, and cheaper way to exchange assets without counterparty risk. This is a complete game changer for so many industries and the use cases are plentiful.

Of course, one major challenge is educating people in this new and emerging industry. Getting people up to speed on purchasing, analyzing, diversifying and securing digital currency will take time. This is something everyone needs to learn now and the industry seems to be adapting quickly to make the process more user friendly. Presently, the crypto space is emerging from infancy and is somewhat analogous to teaching your mother to use email 15 years ago. The big difference is that this revolution is taking place much more quickly and I believe within 5 years, digital currency could be a trillion dollar industry (the market capitalization of all cryptocurrency is currently $120 Billion). In addition, cryptocurrencies in general could represent a respectable percentage of the ADV (average daily volume) of traditional fiat currency trade.

I believe this is a sweet spot for investors to start learning and slowly accumulating some of the major established cryptocurrencies and other altcoins which offer major growth opportunities. Even though this is a much more risky asset class than most, the downside is significantly less than it was one year ago or even 6 months ago. The current traditional menu of investing products yields very little, not to mention the stock market appears to be at the end of long bull market cycle, where there seems to be more risk to the downside than to the upside. I would recommend every investor start to educate themselves on cryptocurrency and digital assets. This is a great way to build a modern, cutting edge, diversified global asset portfolio not controlled by a financial advisor or central bank, nor anyone else. Only you will be in control and have the private keys, passwords, and back up phrases that will give you total power over your wealth.