The king of crypto dropped back down below $60,000 after its impressive rally in October, but bulls like Ark Invest’s Cathie Wood remain optimistic about its price trajectory. She told Barron’s in an interview:
If institutional investors move into Bitcoin and allocate 5% of their portfolios, the price of the cryptocurrency will soar to about $560,000 by 2026.
This corresponds to 800% growth, which seems wild. However, Wood did predict a 1,200% upside in Tesla, which she was right about.
This short article looks at ways to take advantage of the crypto boom. These include buying cryptocurrency stocks, investing in Bitcoin ETFs, and fine art, an often overlooked asset.
Investing in crypto stocks
Cryptocurrency exchanges and other companies that are directly connected to the crypto market make it possible for investors to benefit from the crypto rally. MicroStrategy bought 9,000 bitcoins in the third quarter of this year, bringing its total bitcoin value to $6.7 billion.
Riot Blockchain mines the flagship crypto and holds mining equipment for institutional clients. Its shares have gained almost 500% over the past year.
Another option is Coinbase, which operates the biggest cryptocurrency exchange in the U.S. This summer, its share price dropped below $250, but it is back to over $300 since.
Wood’s Ark Invest amended its prospectus to include exposure to Bitcoin via Canadian ETFs in September this year. Canadian ETFs have been very profitable. In the U.S., the first Bitcoin ETF, ProShare Bitcoin Strategy, made the biggest contribution to Bitcoin’s rally to a new all-time high in October. The fund holds bitcoin futures contracts that trade on the CME.
Cryptocurrencies are notoriously volatile and many people feel uncomfortable holding such unpredictable assets. Fine art correlates only slightly with the stock market’s ups and downs. What’s more, it is often overlooked as an asset.
At the moment, modern works of art are outperforming the S&P 500. Over the last quarter of a century, they have gained 174% more than the index according to data of Citi Global Art Market.
New investment platforms for art
In the past, you had to be ultra-rich to buy a Banksy or Andy Warhol piece. With new platforms like Masterworks, you don’t need to be Jeff Bezos to invest in iconic artworks. The founder of Masterworks aims to simplify the process of investing in modern art.