Cryptocurrency, especially Bitcoin, has attained remarkable traction in the past few years and has sparked mixed reactions in the investment industry. The challenge many investors have with cryptocurrencies is their high volatility. With Bitcoin having surpassed the $60,000 mark, many first-time investors are becoming more and more curious regarding the investment opportunities presented by cryptocurrencies.
The high volatility of cryptocurrencies has frightened away many old-fashioned investors. If you’re one of the investors who are scared of risking their funds directly on Bitcoin, here are several investment alternatives that don’t require you to buy Bitcoins. Some organizations present investment opportunities that adhere to conventional business models yet are still crypto-oriented.
Below are five ways, as indicated by Forbes, of investing in Bitcoin without having to risk your money into buying Bitcoins.
Today, many Bitcoin mining companies offer people opportunities to purchase and sell Bitcoins and other cryptocurrencies. Coinbase’s shares have sunk since its initial public offering in April; however, they have risen steadily since then. Apart from the income Coinbase generates from trades, the company equally has substantial cryptocurrency assets.
Additionally, in August, Coinbase outlined its plan to purchase $500 million worth of cryptocurrency and invest 10% of the profits it will make into crypto assets. Within the second quarter of this year, the company realized $2.23 billion in total revenue, a significant increase from the $186 million obtained in a similar period the previous year. Therefore, by investing in Coinbase, you’ll avoid the direct risk of buying Bitcoins yourself.
In February, Elon Musk’s giant electric-car company gave Bitcoin an uplift when it started purchasing Bitcoins. Since then, Tesla’s Bitcoin assets have generated (paper) revenue of $1 billion. Currently, the company holds approximately 43,200 BTC.
Additionally, Elon notes that Tesla will “most probably” start accepting Bitcoin payments once it evaluates the usage of renewable energy. Its shares have risen upwards of 14% this year. Consequently, this indicates that as an investor concerned with the volatility of the cryptocurrencies, you can invest in Bitcoin with Tesla without buying Bitcoins.
Not many organizations have huge investments in cryptocurrency like MicroStrategy. As of June 2021, MicroStrategy had accumulated a total of 105,085 BTC. On average, the company paid $37,617 for each of their Bitcoins, translating into a considerable profit.
Furthermore, MicroStrategy has constantly defended Bitcoin as a “reliable store of value backed up by a strong, public, and open-source framework unchained to sovereign monetary regulation.” Year to date, the company’s stock has surpassed 76%. Such statistics indicate the potential of investing in Bitcoin using companies like MicroStrategy without directly buying Bitcoins themselves.
4. Hut 8 Mining Corporation
Hut 8 Mining Corp is one of the few North American-based cryptocurrency mining firms obtaining significant market share over the past few months. Analysts note that Hut 8 Mining Corp and similar firms such as Riot Blockchain, Core Scientific, and Marathon Digital are “rigorously making money.”
For instance, Hut 8’s shares have skyrocketed upwards of 292% this year, while Marathon Digital has reached 320%. This indicates the high potential of reaping huge profits through investing in these companies without buying Bitcoins directly.
5. Blockchain ETFs
Exchange-traded funds (ETFs) function as a hybrid between stocks and mutual funds. Virtually, an ETF is a category of stocks, bonds, or other holdings. When you purchase an ETF share, you acquire a stake in what investments are made using the fund.
Often, ETFs are categorized by the type of investments they consist of; therefore, one way an investor can invest in Bitcoin without buying them is by placing into an ETF committed on its fundamental technology: blockchain. Usually, a blockchain ETF involves firms either utilizing or advancing blockchain technology. Ultimately, investors can invest in Bitcoin and other cryptocurrencies without purchasing Bitcoins by investing in blockchain ETFs.
Today, investors have many alternative ways to invest in Bitcoin without the actual purchase of Bitcoins. However, as an investor, you should proceed with care as there is no guarantee that you’ll make profits by investing through third-party companies. Overly, investing in cryptocurrency has its risks, and investors should be ready for any eventuality.