Bitcoin has become headline news again as it approached a record valuation this week, surpassing $19,000 (14,230), before subsequently falling back down towards the $16,500 mark.<\/p>\n
A growing number of professional investors argue that Bitcoin, the oldest cryptocurrency and the largest by market value, deserves a place in a diversified portfolio.<\/p>\n
Sceptics counter that Bitcoin has no intrinsic value as few people use it to buy things, it is unproven as a safe haven asset and faces the threat of legal clampdowns that could make it worthless.<\/p>\n
So should you buy some? And is it ever safe to do so?<\/p>\n
Investors should steer clear, according to Felix Milton of Philip J Milton, a financial planning firm, because governments could intervene at any moment and outlaw it as a currency, making it illegal to own. At the moment its allowed to operate but that may not last forever, he said. I would strongly advise against investing unless it becomes regulated by the Government.<\/p>\n
If this happened, it would reduce price volatility and legitimise it as an investment. But right now it is too risky to own as a serious investment and is more of a gamble.<\/p>\n
Simon King of Vermeer Partners, a wealth manager, said Bitcoin faced two main hurdles before it could be considered investible. He said it needed to be used as a means of exchange, like other currencies, but this was currently not the case. Secondly, it needed to be accepted as a store of value, like gold, but as it was launched only in 2009 it was too early to conclude this.<\/p>\n
All this, along with issues around fraud and theft, drastically limit its merits for a serious investor. For those who want to take a small gamble on volatility, fine. But it should not be an investment choice as part of a considered strategy and portfolio, he said.<\/p>\n
But not all professional investors are put off by Bitcoins volatility and newcomer status. Tancredi Cordero of Kuros Associates, a wealth manager, said the most important reason to own Bitcoin was that it acted as a hedge as its price moved in different directions from other investments, including gold.<\/p>\n
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More here: Bitcoin has become headline news again as it approached a record valuation this week, surpassing $19,000 (14,230), before subsequently falling back down towards the $16,500 mark. A growing number of professional investors argue that Bitcoin, the oldest cryptocurrency and the largest by market value, deserves a place in a diversified portfolio Continue reading
\nShould you invest in Bitcoin and how to do it - Telegraph.co.uk<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"