Is Investing in Cryptocurrency a Good Idea in 2023?
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Loading... - Lily Valen
- 09 Mar 2023
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Whatever you decide, here are five tips from advisors for managing the risks of investing in crypto.
For those who underestimated the risks of investing in cryptocurrency until recently, the collapse of crypto exchange FTX in late 2022 and its domino effect on other firms was a wake-up call.
The leverage and solvency quagmire associated with Alameda Research, the trading arm of FTX, led to its bankruptcy and the arrest of CEO Sam Bankman-Fried. Worse, the whole string of events led to a loss of billions in the cryptocurrency market, as investors' confidence declined and crypto's market capitalization plummeted.
The FTX brouhaha and ensuing "crypto winter" followed the fall of stablecoin TerraUSD (UST) and its companion token LUNA in May 2022, which already had officials up in arms about regulating the burgeoning crypto industry.
Cryptocurrencies as a whole, and Bitcoin (BTC) and Ethereum (ETH) in particular, have bounced back a bit in the first part of 2023, sending the cryptoverse's market capitalization over $1 trillion and prompting some to speculate that the crypto winter is over. But many financial advisors are still recommending that investors use caution and keep these investments limited to a small portion of their portfolios. Read More..
