In his column, experienced trader Andrey Elinson talks about trends in the cryptocurrency market, gives recommendations for working with major cryptos, and shares his thoughts on the prospects of this market.
Cryptocurrency market trends continue to worry many existing and potential investors. This is hardly surprising, since, considering the current background of general financial instability, cryptocurrencies can serve as a good alternative for investments. However, the recent collapses of several currencies may cause concern and uncertainty, and the problems of major players may cause doubts regarding the reliability of cryptocurrencies as a whole.
Perhaps the most revealing and impactful event of recent times was the collapse of the cryptocurrency exchange FTX. Its owner, Sam Bankman-Fried, filed for bankruptcy and resigned as CEO. Of course, it became a shock to the crypto industry, but we should not associate the problems of FTX with the industry as a whole. After all, the investigation revealed that Bank man-Fried covered the losses of Alameda with the funds of the FTX customers while keeping other executives of the exchange in the dark. He used at least $4 billion from the stock exchange funds. So, considering the circumstances, certain problems should not be a surprise.
Cryptocurrencies Continue to Evolve
When I was still in school, only a few people were actively engaged in Bitcoin mining (Ed.: Andrey Elinson was born in 1985 in Tolyatti). It was a time when you could “mine” cryptocurrency on your home computer. Now, even specialized equipment is often unprofitable and is not enough to mine crypto currency in sufficient volume. By the way, this is why the demand for video cards has finally started to decline.
For those who plan to invest in cryptocurrency, now is a peculiar period. On the one hand, the value of cryptocurrencies has fallen, which means it is possible to make a more profitable purchase. But on the other hand, no one wants to do it too early, so as not to lose their money. The same situation could be observed when I received my first higher education (Ed.: Andrey Elinson graduated from school and entered MIPT in 2002).
There Were, Are, and Will Be Fluctuations and
However, the decline observed earlier is not the first and certainly will not be the last for the digital asset market. I remember when I was a student, there were a lot of talks that “crypto is coming to an end”, that “no one will invest in it”, but the number of people who want to not only mine, but also buy cryptocurrencies continues to grow.
During my studies in economics (Ed.: Andrey Elinson graduated in management and economics from MIPT), I formulated several criteria for working with various assets and I continue to use them to this day. Based on this experience, which is expanding every year through the analysis and consideration of new situations, new cases, and new trends, I am gradually expanding the portfolio of assets that I work with myself and recommend to my clients.
The World Needs Cryptocurrency
There are a lot of reasons for the further development of cryptocurrencies. One of them is the widely discussed situation with the stability and reliability of the U.S. dollar, which can be perceived in many different ways. It is indisputable, however, that it creates additional demand for alternative financial instruments. Blockchain-based cryptocurrencies are among the most promising in that regard.
Attitudes Toward Digital Assets Is Becoming Reasonable
I got a broader introduction to cryptocurrency operations after my MBA studies. In 2011, I graduated from one of the oldest business schools in Europe (Ed.: Andrey Elinson got a Master’s degree in Executive MBA Strategic Management in HEC (École des hautes études commercials de Paris)) and discovered that more and more companies were using crypto assets in their financial operations. And in many countries, the legislation is not only lenient to Bitcoin, Ethereum, and other altcoins but fully supports them (Ed.: Andrey Elinson provides services and advises clients on cryptocurrency trading).
Today, we can also say that cryptocurrencies are gradually becoming part of the financial system. Thus, regulators are also developing rules to work with them, and the politicians of several countries talk about creating national exchanges to support fellow citizens who have savings in crypto. They also serve as one of the channels for the formation of a global and heterogeneous financial system.
Thus, despite the decline in the value of several cryptocurrencies, they remain an important strategic asset for people in several countries. After all, the prices of various metals can also rise and fall. Shares of companies can rise and fall. Now we have seen a decline in the value of Bitcoin, but I continue to work with other digital instruments that are currently on the rise (Ed.: In his lectures and master classes, Andrey Elinson recommends diversifying crypto assets and actively promotes investment in altcoins).
However, Bitcoin itself will also reach its growth stage. The only question is when it will happen. Specialists that analyze the market signals and see the impact of various trends on cryptocurrency rates will be able to get the most out of this process.
About Andrey Elinson
Born May 18, 1985, in the city of Tolyatti.
2002 Graduated from high school with a silver medal;
2007 Graduated from MIPT (Department of Control and Applied Mathematics);
2009 Defended his thesis in Management and Economics at the same MIPT;
2011 Defended his thesis in Executive MBA Strategic Management in HEC (École des hautes études commercials de Paris), one of the oldest business schools in Europe.