Opinion – From Grain to Grain: Bitcoin, Bitnumber or Bitalgo, what are you investing in?

in the advertisements of cryptos we see these being displayed as shiny gold or silver coins. However, this has little to do with what he actually is. One cripto is nothing more than an encrypted character set.

The analogy I see in these photos is from the old cigarette advertisements in which young people were shown running on horseback or piloting luxury boats.

the name of the cripto better known, Bitcoin, leads you to a false association with currency and we know that it does not qualify as such by the characteristics.

I have no doubt that the name chosen was very fortunate for its success, but it can wrongly influence the decision of investors.

Perhaps you will argue that you are not influenced by it. However, when you think of Bitcoin, what image comes to your mind? The one on the right, or the one on the left?

If it is the image of the shiny coin, you are already conditioned in this subliminal language.

I remember that I was once talking to the financial director of one of the big cryptos from the country and asked him: “how much do you have in Bitcoin of your equity?”

To my disappointment he said: nothing. I’ve already ironically retorted, “but doesn’t it protect against inflation?” I got a laugh in response.

The fact that it is represented by a golden coin leads to the analogy with gold and inflation protection.

I’ve seen many conservative investors who shy away from any equity investment, but who invest in cryptos, as they believe it is a currency that protects against inflation. This is worrying.

Undoubtedly, the technology used in cryptos will change the way many transactions are carried out today.

However, it is very important not to confuse the technology with the asset.

For example, the technology employed in credit card transactions has greatly facilitated business transactions. However, you do not buy a credit card. Just use this technology.

The US and the world will go through a cycle of rising interest rates due to rising inflation. Instruments that do not have remuneration, such as interest and dividends, and depend only on price changes, may suffer.

I’m a fan of new technologies.

I’m not arguing that no one should have cryptos in its portfolio as a form of speculation on its prices, but a regulation identifying the risks involved in the investment would make sense.

Michael Viriato is an investment advisor and founding partner of Investor’s House

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