Investing in cryptocurrencies is already a consolidated financial and technological trend, but there are still many people who have stayed on the sidelines and have not yet decided to take the step because they do not know if it is early or late to buy Bitcoin for the first time.
Wells Fargo, in a new report entitled “Understanding Cryptocurrencies”, tries to resolve this doubt and is optimistic about it, considering that the number of investors continues an upward progression that is not expected to decrease in the coming years, but which will become more and more frequent and the number of cryptocurrency users will increase.
The report to understand cryptocurrencies
It is not too early, much less too late to start investing in Bitcoin (BTC), the fourth largest bank in the United States points out in said report. The traditional financial institution of the United States believes that the massive hyper-adoption of cryptocurrencies is underway and sees the current situation as a turning point in the trend. In fact, it establishes a peculiar comparison that will help us understand the current situation from a more mundane point of view: there are more and more Bitcoin users all over the world, as happened with the Internet in the 90s.
As can be seen in the graph above, the curve shows an upward trend similar to that of the number of Internet users in the last decade of the 20th century. From the time of the Internet’s launch in 1983 to 1995, only 14% of Americans used it (less than 1% of the world’s population). The number increased from 77 million in 1996 to 412 million in 2000. After that, the number of Internet users worldwide rose to 1.98 billion and reached 4.9 billion in 2010. The numbers of investors in cryptocurrencies are really similar..
It’s time for cryptocurrency hyper-adoption
With these data, Wells Fargo considers that there is no going back in the investment trend in cryptocurrencies and there is no longer a possibility that the level of adoption they reached will decrease, but rather that it will continue to increase, each time with greater speed. In addition, he expects the number of Bitcoin investments to increase as more and more success stories are revealed, of millionaires who achieved a large part of their wealth through investment in crypto. For example, the Forbes list of the richest on the planet in 2021 already featured 12 crypto-asset entrepreneurs.
The financial institution believes that little by little more people will be attracted to the cryptocurrency market instead of traditional investment in the Stock Market, since it is one of the best-paid assets. That is the case with Bitcoin, which has seen a “216% year-over-year increase since 2010, while the total return of the S&P 500 stock index stood at just 16% annually.”
The forecasts are equally rosy, since in 2022 new highs are expected to be reached for the value of BTC, with forecasts from $100,000 and even the most optimistic reaching $200,000 for the second part of 2022.
Of course, Wells Fargo recommends that any foray into this market should be guided by professionals and clarifies certain restrictions in this regard: «For now, we suggest the consideration of only professionally managed private placements. We do not recommend any of the other current investment options, such as mutual funds, ETFs, trusts, and individual cryptocurrency speculation. We are hopeful that greater regulatory clarity in 2022 will provide higher quality investment options.”
