Here’s why Bitcoin could maintain this momentum throughout 2021, and why you should consider adding it to your wallet before it’s too late.
Over the past year, the value of this cryptocurrency has increased due to institutional interest. Some heavy hedge fund managers have added digital currency to their portfolios, while online payment and stock trading platforms have integrated it for easier access. A state-owned company has put the majority of its balance sheet in Bitcoin.
However, retail investors and average savers have so far missed these gains. According to recent surveys, Bitcoin is still far from being a popular investment option. This year, that could change. After all, ordinary Canadians can now access Bitcoin directly through their WealthSimple accounts.
Meanwhile, a Bitcoin exchange-traded fund and several Bitcoin mining stocks were also listed in 2020. This means that there are now plenty of options for retail investors to bet on cryptocurrency. Interest in retail could drive the price of this digital asset to new heights.
If you are looking to get in, this might be the perfect time.
Invest in BTC
the Bitcoin Fund (TSX: QBTC.U) is a convenient option for investors looking for exposure here. As a regulated and listed security, this fund probably offers a safer alternative to directly owning BTC. It is also eligible for your Tax Free Savings Account (TFSA), which allows you to protect your impressive tax gains.
Another alternative is a Bitcoin mining stock such as Technologies HIVE Blockchain (TSX: HIVE). HIVE operates server farms that create cryptocurrency. Some of this freshly minted currency is reinvested in the business to stimulate growth. The rest is held in reserves on the balance sheet.
As the value of CTB increases, HIVE’s operations and track record become more valuable. This is reflected in the share price, which has risen 2,200% over the past 12 months. If you are looking for an aggressive growth strategy and a way to amplify your BTC bet, this is definitely an ideal option.
However, keep in mind that these securities and the cryptocurrency space are still somewhat speculative. Expect high volatility in the coming months.
At the end of the line
All of the factors needed to drive Bitcoin up seem to be coming together in 2021. There is growing demand from retail investors, and institutions are already heavily involved. This could be the year when cryptocurrency finally becomes a mainstream asset class.
If you are looking to get in and expose yourself to this bull cycle, this might be the perfect time to do so. You can now buy BTC directly or bet on it through mining stocks or an ETF. Adding exposure to this industry has never been easier. Good luck!
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