Private investment firm Hargreaves Lansdown has issued a statement on crypto and Bitcoin specifically, describing the world’s most popular crypto as “not an asset class.”
To quote the firm:
“…we do not think cryptocurrency has characteristics that mean it should be included in portfolios for growth or income and shouldn’t be relied upon to help clients meet their financial goals. Performance assumptions are not possible to analyse for crypto, and unlike other alternative asset classes, it has no intrinsic value.”
While recognizing that some investors will purchase Bitcoin, Hargreaves Lansdown cautions investors on crypto as they are “high risk investments” and not appropriate for retail investors.
Hargreaves Lansdown said it will offer “appropriate clients” access to ETNs (ETPs) next year.
Crypto exchange-traded notes or cETNs were made available to retail investors in the UK this week (October 8).
In August, David Geale, executive director of payments and digital finance at the UK Financial Conduct Authority, explained:
“Since we restricted retail access to cETNs, the market has evolved, and products have become more mainstream and better understood. In light of this, we’re providing consumers with more choice, while ensuring there are protections in place. This should mean people get the information they need to assess whether the level of risk is right for them.”
Some of the policy changes have been driven by the US adjusting its approach towards digital assets, reversing the aggressive stance undermining crypto during the Biden administration. The current administration aims to create a regulated ecosystem that fosters innovation while ensuring investor protection.
Bitcoin started the year trading at around $93,000. Today, Bitcoin trades at over $121,000, representing a gain of around 30%.
Some people see Bitcoin as akin to digital gold. Others view it as a hedge against a devalued currency, as the supply of Bitcoin is capped. Regardless, Bitcoin has emerged as a popular trading vehicle, with some predicting that BTC will rise dramatically in value in the coming years.
