Bitcoin, a virtual currency created shortly after the 2008 financial crisis, has seen phenomenal price growth of around 700% from early 2020 to now. The digital asset also got a boost with companies such as Tesla, BNY Mellon and Microstrategy showing support for it.
One in four people invest in cryptocurrency, according to a recent Finder survey of 1,004 Australians. Finder also found that almost half of cryptocurrency investors, bought the asset because of its rising value.
New AIA board director Nadine Wake recently decided to dive into the cryptocurrency market. Here she shares her story:
Last year prior to Christmas, I read several articles about Bitcoin’s investment potential and following a discussion with my partner, we decided to invest in the cryptocurrency. Some research was required to decide how to purchase Bitcoin. Choices include investing in companies that have invested in Bitcoin, for example, Tesla, choose an exchange traded fund (ETF) focussed on cryptocurrency, or make a direct investment. I decided to buy Bitcoin directly – a personal decision that suited my level of investment risk. Some investors may not prefer this approach as the price of Bitcoin fluctuates widely and they may take a more cautious approach.
The next step was to decide on a reputable platform to invest in Bitcoin which I researched through canstar.com.au. I decided on swyftx.
So now the biggest decision – the size of the investment. As an SMSF director with an investment plan, it had to be less than 5% of my total portfolio size. Bitcoin has significantly increased in value in the recent past, however you can purchase a portion of a Bitcoin. All that was left to do was transfer the cash electronically to the platform, make the purchase and watch it grow!
Industry experts usually recommend investors buy a Bitcoin wallet to avoid any loss due to online theft or fraud. The significant drawback to this approach is if you lose your wallet or associated password, your Bitcoin is lost forever. The wallet also costs approximately $100.
To date my Bitcoin investment has increased over 25%, hence I am a happy Bitcoin investor, aware of the pitfalls but enjoying the ride.
Thank you for sharing your experience, Nadine. Please note buying Bitcoin is not a recommendation, nor is the platform that was used, rather a personal investing experience.
To watch AIA’s recent webinar, Understanding Crypto Assets & the outlook for 2021, please visit this link.