Cryptocurrency and Cryptocurrency Stocks Have Generated A Lot Of Attention, But Why?
The total market cap for the entire cryptocurrency sector just keeps heading higher. Yep, as we said in another article, with the rise of bitcoin to new all-time highs, the market capitalization for cryptocurrencies has risen to more than $170 billion. Do you know what this equates to as far as growth for the year? That percentage increase is equal to eight hundred and fifty percent since January 1 of 2017.
But why does cryptocurrency continue to grow as an asset class?
The reason is multi-faceted. One can look to the plethora of initial coin offerings (ICO), which have garnered more attention and raised intrigue from new investors. Companies were able to raise some $1.3 billion through ICOs during the first half of 2017. Even FinTech firms were able to raise much more through ICOs than they had through traditional venture capital investment.
What have become known as token sales are also in the spotlight but are less interesting for raising capital but they have still pushed cryptocurrency markets higher.
“The ease of fundraising via an ICO is drawing both entrepreneurs and investors away from less effective capital raising channels,” said Brad Chun, chief investment officer of hedge fund Shuttle Fund Advisor.
Increased adoption of the currencies has also played a role. Investors scrambling to digital currency like Litecoin and Monero, shows a clear and rising demand.
Petar Zivkovski, COO cryptocurrency trading platform Whaleclub, said in a note, “There is a rising interest in cryptocurrencies in general and many more ways to acquire them as local exchanges have popped up en masse across the world,”
In the end, shifting investor perception has been a big help for the acceptance of cryptocurrencies as a viable investment option. People are beginning to notice that crypto assets could be a more secure option and may be much more than the “fad” that some investors still think it to be.