Investing.com – Tesla (NASDAQ 🙂 founder Elon Musk, who contributed a lot to the rise of the comic cryptocurrency, now recommends investing in cryptoassets with caution.
“Cryptocurrency is promising, but please invest with caution!” wrote he’s on his Twitter (NYSE :).
In the video under the tweet, Musk mentions the irony of turning “currency invented as a joke” into “real currency.”
The DogeCoin Rally has lifted the asset price by over 12,000% this year to a record 69 cents per token. wrote Thursday WSJ. Bitcoins briefly climbed to over $ 60K apiece last month, more than doubling in price since late 2020. This prompts investors to look to new digital assets such as DigiByte, VeChain and SafeMoon in search of cheaper alternatives that could be better, the newspaper notes.
Meanwhile, the Governor of the Bank of England (BOE) Andrew Bailey said yesterday that cryptocurrencies “have no intrinsic value” and people who invest in them must be prepared for losses. informs CNBC.
“I’ll put it very bluntly again,” he said. “Buy them only if you are willing to lose all your money.”
Bailey’s comments echo a similar warning from the UK Financial Conduct Authority (FCA), which warned investors back in January of the possibility of a total collapse.
Bitcoin is up more than 90% this year, thanks in part to growing interest from institutional investors and corporate buyers like Tesla.
Bitcoin proponents see it as a store of value or a hedge against inflation, similar to its limited supply, as only 21 million bitcoins can be issued in the world.
However, skeptics view cryptocurrency as a market bubble that is waiting to explode. Michael Hartnett, chief investment strategist at Bank of America (NYSE 🙂 Securities, said bitcoin’s growth looks like the “mother of all bubbles,” while Stephen Isaacs of Alvine Capital believes the product “lacks fundamentals and point”.
Meanwhile, alternative digital currencies have brought in even greater gains than. Ether, the blockchain’s proprietary token, has generated over 360% of its profits since the beginning of the year, while DogeCoin, as mentioned, has grown by over 12,000%.
David Kimberley, an analyst at UK investment app Freetrade, described the DogeCoin rally as “a classic example of the current big fool theory,” referring to the practice of selling overvalued assets to investors willing to pay higher prices.
At the same time, the largest US banks are gradually starting to provide wealthy clients with the opportunity to invest in cryptocurrency, and central banks, including the Bank of Russia, are considering issuing their own digital currencies.
– In preparation, materials from WSJ and CNBC were used