Qoin's View on How Digital Currencies Can Diversify Portfolios
The integration of digital currencies into the Australian economy is undoubtedly challenging our traditional financial systems and products. This innovative Fintech product is inspiring investors and individuals to further investigate diversifying their portfolios by going digital. In our fast-paced world, long term sustainability for maintaining and building wealth is intrinsically linked to adapting to ever-evolving technological and financial advancements. This involves developing innovative strategies to enhance what were once conventional financial portfolios. Diversifying portfolios through the addition of digital currencies can potentially increase returns. Why is this change needed? It is undeniable that the Australian economy has always restructured itself over time to keep up with the growth of innovative technologies. Australia’s digital currency market is seeing rapid exponential growth, with a recent finding from Accenture noting that Australian Digital Currency Exchanges represent 66% of local markets. This digital transformation is changing all aspects of the world, meaning businesses are moving quickly towards adopting digital currencies as payment methods to keep up.
Investment in digital currencies Digital currencies as we know them - were invented back in 2008. Original investors in new currencies have since seen huge returns. For many people across Australia, managing and investing in an investment portfolio is a profession, but for some, it is a hobby which has the potential to provide the alleviation of financial stress once they have retired. For portfolio strategies to continue being successful, it’s important that investors take note of the digital currencies revolution and make investments that will secure their financial prospects in the future. Investment in digital currencies saw a dramatic increase in 2017 when Bitcoin – the most popular form of digital currency across the world – saw a steep rise in price. Both experienced and naïve investors decided to invest their money into these coins. While investing digital currencies was originally considered to have high risk factors, research has since concluded that if Bitcoin was included in a portfolio, even in small proportions, the risk and return profile of a portfolio was improved, sparking a re-assessment of the benefits of digital currencies as a whole. The bottom line Recent advancements in Fintech have brought digital currencies to the forefront of investors’ minds. With the growing expectation that Australia will become a cashless society at some point in the fairly near future, people are looking for investment opportunities in digital currencies as a way of diversifying their portfolios into different asset classes. Investors are looking to upgrade their strategies to keep up to date with the rapidly changing financial world and where the future of wealth is going. As digital currencies are growing at an impressive rate, including them in a portfolio is likely to yield increased returns and a diversification of risk. As people become more confident in the financial benefits that come with investing in digital currencies and in their daily utility, we may see more investors choosing to diversify their portfolios by using several different digital currencies in the market such as Bitcoin, Qoin, and Ethereum rather than just one, providing them with a competitive advantage in such a volatile market.