Rapid changes in blockchain and cryptocurrency technologies are creating opportunities where opportunities simply didn’t exist before. In this episode of The Yield, Peter Kerr welcomes Dchained co-founder and managing partner Edmund McCormack for a conversation about blockchain, cryptocurrency investing, and risk management education.
[1:21] Education or investing — which came first for Edmund?
[6:03] Who really needs to understand the technical side of investing in bitcoins?
[8:02] Key components to successfully entering the crypto space.
[9:50] Offerings of the lesser known blockchain technologies.
[11:38] Web 3.0 and the role it will play in blockchain and decentralization.
[20:52] What are the true supply drivers of bitcoin?
[25:01] Is blockchain headed toward a dot com-style bubble burst?
[28:51] A comparison of blockchain to gold.
[32:38] Finding a place for crypto in your investment portfolio.
[35:29] Educational resources to expand your investment horizon.
One of the most common reservations that new investors have about crypto is that they just don’t understand the inner workings of the systems at play. It can be overwhelming to try to understand exactly how blockchain works, but in reality, how much do any of us really know about the complex algorithms that make any of the Internet work? You may not understand the complex systems that make audio and video work together in near real time, or any other number of technologies that make business happen, but the average smart user or investor really doesn’t have to know everything about these technologies to benefit from them.
Generally speaking, people look at the face value of a consumer product or service, and then they invest in the commercial value of it. According to Edmund, it is a major misconception to feel like you need to be a computer scientist or that you need to be highly technical from a development standpoint to get involved in the crypto space, when really, that’s just not the case.
Take the advice from someone who has been deeply invested in crypto for over 10 years. Edmund makes it easy – just start with the basics. Take time to learn about the big picture and to understand the four major fundamental cryptocurrencies that are the building blocks of the entire system. By looking at crypto through the same lens as you would equities, it becomes clear to see which steps to take first. Just as a smart investor would buy into an index fund rather than stock picking, there are potentially major benefits to focusing on the main crypto building blocks rather than on any one particular – or popular – coin.
Along with cryptocurrencies, Web 3.0 is another rapidly developing aspect of the decentralization of finances, but what exactly will a world with Web 3.0 look like? Edmund walks listeners through the possibilities that are transforming the landscape as it merges with blockchain, and the bottom line is that these technologies are creating opportunities to add value in ways that simply didn’t exist before.
Many investors wonder about the true drivers behind blockchain, and whether some of the novelty coins are going to fade away over time. According to Edmund, just as the dot com bubble separated the struggling businesses from the strongest ones, the most valuable blockchain offerings will persist over time while those that are not as viable are not going to last. And when many consider bitcoin as valuable as gold, it is expected that the value of bitcoin is going to last for a long time.
With highlights on the educational resources that can help expand your investment horizon, insights into the regulations that are being put in place surrounding blockchain and a promising look at all that the future of bitcoin holds as it continues to mature, there are a variety of reasons to consider this as the next place to expand your investment portfolio. For more information, visit www.yieldstreet.com today.
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