Cryptocurrency has become an increasingly volatile market, with ups and downs of up to forty percent or more on some days. However, with volatility comes opportunity, and a few savvy investors have already capitalized on huge gains throughout the years.
Factors That Affect Cryptocurrency Valuation
Like any other currency, cryptocurrencies get their value based on market variables: supply, demand, utility, and scarcity. It is worth noting that some cryptocurrency valuations will stem from a company’s image efficiency, as most of the digital currencies in the market are issued by private blockchain-related companies.
Elon Musk is one of the most prolific entrepreneurs in the technology industry, and as such, his comments on the value of cryptocurrency have considerable sway on the public, and therefore the valuation. He doesn’t seem to be fully aware of the gravity of these comments when it comes to what he says or tweets about cryptocurrencies. Almost every time the billionaire has made a tweet about cryptocurrency, he has sparked financial chaos. This is because he controls two big industrial powerhouses that can choose to accept cryptocurrency transactions. It is also because his social media influence has an enormous influence on people’s opinions on cryptocurrency values.
What Makes Real Estate Tokenization More Stable Than Other Cryptocurrency Investments?
Despite the popularity of bitcoin, it remains a risky and volatile investment. Are tokenized hard assets such as real estate a better option for investors?
The answer is simple. Yes, because it is based on real estate rather than public perception. Real estate is one of the fastest appreciating assets that the average investor can own, mostly due to the necessity of commercial and residential real estate.
Tokenization is the method of making a virtual token to signify ownership of a real estate interest. Fractional ownership allows for partial ownership in a single property, made possible through smart contracts and digital transactions facilitated through blockchain technology.
However, not everybody has the massive amounts of capital needed for such investments. As it turns out, the solution is fractional ownership blockchain real estate. This is an enormous technological advance from the traditional process of buying and selling real estate, offering more accessibility to those who cannot afford a mortgage to buy the ownership of the entirety of a property. Fractional real estate investments provide a rare mix of high returns and low risk.
Moreover, the current pandemic has caused a shift in how investors think about different types of assets. Due to the economic slowdown of the pandemic, many retail investors have lost a significant amount of money on commercial goods and services. Many investors are now eying lucrative new opportunities, eager to hear more RealT fractional real estate news.
Unlike the rest of the U.S. financial market, commercial real estate only had a modest recession during the lockdown and it posed to recover well. The future looks bright for investors to wish to start investing in real estate through tokenization. Commercial prices are anticipated to increase, albeit there may be bumps in the road due to the aftereffects of the coronavirus wave.