Lyle Hauser Places Bet on Asset-Backed Cryptocurrencies as Best Investment
The Key To Cryptocurrency Investment Is In Quality—Not Quantity.
The continued evolution of cryptocurrency-backing technology is one of the most important parts of the market. As crypto markets continue to develop, it is important that investors begin to assign value based not off of the flashy words behind cryptocurrencies, but rather on the realities behind the currency itself.
For many investors, the concept of a gold-backed cryptocurrency is incredibly alluring. Gold has been a consistent backer of value, with currencies all over the world being backed by it at some point or another.
But gold-backed cryptocurrencies are relatively common and finding a currency which is actually linked and pegged to the price of gold is difficult. For this reason, some investors have chosen to throw their money at multiple currencies, hoping that there will be some sort of substantive value behind one of them.
But professionals in the industry warn that this might not be the right strategy. Instead, top analysts find that the right way to invest is instead to try to find the right gold-backed cryptocurrency, which may be easier than it initially sounds.
Oversaturation of the market has always been one of the biggest problems facing cryptocurrency. At this time, there are more than 1,600 cryptocurrencies which currently exist on the market. These currencies range wide in their functionalities and backing developers.
This means that for the average investor, it is increasingly difficult to find the cryptocurrency that might retain, or even increase in, its overall value. Additionally, factors like market insecurity, lack of backing assets, and market manipulation all play factors in causing some to shy away from investment.
Gold is not the only way that currencies obtain a pegged worth to lean against. Currently, a variety of pegged currencies lean against different things. There are currencies backed by oil, some backed by contracts, and even some that are backed by real estate and diamonds. But for some investors, there is nothing like good ole’ fashioned gold. The hypothesis is relatively backed historically.
The United States has one of the most significant and lasting economies in the history of the world, and much of the stability of the currency peaked when the U.S. still worked under the gold standard.
For altcoins, this backing makes sense. Though Bitcoin derives much of its value from both its limited supply and the interest of the public, newer altcoins have very little to back up the price which is initially assigned to it. But with gold backing the currency, it might be possible for a newer altcoin to derive legitimate value from its relationship to gold.
But not all gold-backed altcoins are created equally. Investment advisors consistently argue that cryptocurrencies should be viewed cautiously. It isn’t just the safe value in gold that matters to the worth of a currency. Several factors, including the technology backing the cryptocurrency, as well as the development team behind its initial release, should contribute to the decision regarding which coin to inevitably invest in.