Would you invest in Trump Coin?
TIM McINTYRE WOULD you invest in Marijuana Coin? How about Tattoo Coin or Invisible Coin?
You can even get behind Trump Coin, created in early 2016 to help the now President into the White House.
The Bitcoin craze has awakened the public to the burgeoning cryptocurrency space, which now has almost 1400 types of “coin” listed by Coinmarketcap.com.
Many cryptocurrencies have experienced significant growth in recent times, but high fees, long transaction waiting periods, links to the criminal underworld and complexity of how the values work are some of the emerging negatives.
An average Australian thinking of investing in the space needs the right preparation, according to Josh Callaghan, general manager of wealth at financial comparison company Canstar.
“Cryptocurrencies exist to remove the middleman – banks primarily – from global financial transactions, enabling large scale person-to-person exchanges of value without using a third party,” Mr Callaghan said.
“It’s a revolutionary idea but for the everyday Aussie it can be risky. If anything happens such as losing your account number, private key, having your details hacked or funds not turning up in your account, there’s no-one to call for help. In most cases, your money is simply lost forever.”
Mr Callaghan said three key aspects needed to be understood: the coin’s value, the cost of the investment and security.
Values were difficult to determine, but could be linked to the aim of the coin; to either solve a problem or deliver a new service to improve users’ lives.
Once you’ve purchased, you need to make your coins secure.
“Enable two-factor authentication on your account and store your coins in a secure wallet,” Mr Callaghan said. Damien Hatfield of Triple A Partners recently formed EKT Active Fund, an actively traded cryptocurrency and ICO fund.
“Cryptocurrencies is just another asset class,” Mr Hatfield said. “But I think the technology base is here to stay. It’s new, it’s now established and it is going to grow and grow.”
NEXT WEEK: FIVE WAYS A CRYPTOCURRENCY MAY HAVE VALUE