Bitcoin advocate Charlie Shrem has said that new crypto investors should not be spooked by the volatility of the asset class, but should rather select a token near the top end of the market and adopt a long term investment position.
“Learn and Have Fun With It”
Speaking to Yahoo Finance at the MoneyShow conference in San Francisco on Thursday, August 23, Shrem advised against excessive exposure to crypto assets on the part of new investors.
Acknowledging the unpredictable nature of cryptocurrencies, he said:
“You’re putting your wealth in these things, and they break. Things happen. The values go down 90%, then the values go up 100%. I always tell people if they want to get into crypto, ‘How much money, if you lost it right now, would you be OK with?’ ‘$500,’ they tell me. So invest $500 in a basket of crypto, and then just have fun with it. Just enjoy it, learn. There’s a lot of good ones: bitcoin, Ethereum, Dash, Litecoin. Just learn what makes them different.”
Shrem also advises investors to buy crypto with the aim of holding for five years, after which they will have a heightened probability of getting a return. This he says, is because bull and bear markets usually occur in two-year cycles.
In July 2016, CCN.com reported that Shrem was freed from prison following his 2014 conviction for conspiring to sell bitcoin to users of the illegal marketplace Silk Road. At the time of his arrest and indictment, Shrem was the founder of BitInstant, a crypto exchange that once processed as much as 30 percent of all bitcoin in circulation.
Since his release, Shrem has co-founded Crypto.IQ, a crypto education startup that offers resources, insights, daily newsletters, marketplace access and text alerts to crypto traders. He acknowledges that the crypto scene has changed dramatically since BitInstant became defunct, but he does not see the proliferation of cryptocurrencies as a bad thing, or a threat to bitcoin.
Explaining his point of view he said:
“These 1600 coins are doing the guerrilla marketing. They’re doing that on-the-pavement work that crypto used to do in the early days. It’s getting people in — it’s getting people intrigued…Bitcoin will always be that ‘daddy’, that long term gold that everyone has a huge amount in. You will see overtime that the transaction volume of bitcoin will go down because people are going to see it more as a store of value knowing that if that one fails, they all fail. But it’s definitely fun to have other projects like Steem to experiment with and see what they’re all about.”
Shrem also believes that the long-awaited SEC permission for a bitcoin ETF will take place sometime in 2019, but he warns that the crypto market has to use the opportunity wisely because it will only get one chance to prove itself.
In his words:
“We only have a ‘first shot’ at it. If we have an ETF, something happens, we get screwed. They shut it down. You know hard it’s going to be to have an ETF again?”
Featured image from Flickr/TEDx UTampa.
Last modified: March 4, 2021 3:37 PM