Sentiment versus facts. In theory, facts should win every time. Unfortunately, they don’t always. Look at the crypto markets. Right now, crypto currencies are largely sentiment-driven. They reflect investor confidence, which at the moment is extremely low. Investors believe crypto is in deep trouble. But the facts don’t support that conclusion. In fact, when you look at the crypto landscape, it’s filled with good news and positive developments:
1. Developers are in the process of making major improvements to Ethereum.
2. The bitcoin Lightning Network is growing rapidly and improving transaction rates.
3. The infrastructure for big institutional investors to invest in crypto currencies is almost complete.
These are all reasons for optimism. Will it take time? Yes. But the hard work is being done. The infrastructure is being built out. The facts are right there in plain sight.
You should prefer facts to sentiment. Facts should guide your investments. Facts should tell you to keep a small portion of your portfolio in crypto currencies.
Sven Franssen