Cryptocurrency investment is a fashion statement

Cryptocurrencies are a danger to sustainability and they have failed as a practical currency. However they found success as an investment product. Even as such they are accused of being a risky speculation in spite of rapid growth and big investment.

Main cryptocurrency investment characteristics are:

• It is easier to invest in cryptocurrencies. Trading is less regulated and it is easily accessible to anyone anywhere.

• Investors do not need to invest hundreds of thousands to gain relevant profit. Since they are high growth, smaller investment can be profitable.

• Little knowledge is needed to participate. There is no need to understand market mechanics, forex, innovation, competition.

All of these points are typical of speculation and possible scams, but here the last and most important point:

• Cryptocurrency investors are buying an asset which has no hard value, no use, and probably never will. The only point of buying is to buy it, and not to buy something else. Cryptocurrencies are a fashion statement for those who want to differentiate not only by their clothes and music, but also by their investment choices. This need for individual differentiation is fueling the crypto growth.

Basically, younger investors are saying NO to Wall Street. They are the same people who cheered for GameStop. Cryptocurrencies are purely virtual soft product, which allows its investors to differentiate. It is an investment product more similar to punk and Versace, rather than mutual funds and Apple stock.

To predict its growth we must answer this question: How many more people will want to use cryptocurrencies as a fashion statement?

Written by: Nikola Tosic
Publishing date: 6 May 2021