Last weekend, bitcoin hit US$57,000, which gave it a market capitalisation of more than $1 trillion.
Ethereum, the second-largest cryptocurrency, surged past US$2,000 for the first time, giving it at the time a market cap of $226 billion.
However, the digital currencies have since seen a pullback, with bitcoin losing almost $100 billion in market value in just one week.
Nigel Green, the chief executive and founder of deVere Group, said, “Despite this week’s drops, the bitcoin price has still soared by almost 360 per cent over the last 12 months, partly fuelled by endorsements made by Tesla billionaire Elon Musk, among others, and growing interest from institutional investors.”
He also said a poll from deVere Group showed that 70 per cent of clients aged above 55 of those surveyed had already invested in digital currencies or were planning on doing so this year.
“While the recent massive social media hype and clickbait headlines are more of a catalyst for Millennials and Gen Z to consider investing in the likes of bitcoin, there are other drivers for older generations,” Mr Green explains.
“The over-55 respondents to the survey frequently cited a key factor for their interest in crypto is the historic levels of money-printing as central banks around the world attempt to prop up their economies following the fallout from the pandemic.”
Mr Green believes older investors are moving to digital currencies due to a flood of money devaluing traditional currencies, with bitcoin’s reputation as ‘digital gold’ likely to attract older investors.
“Bitcoin will continue to dominate the crypto ecosystem, but even within this class, it is recommended to maintain a diversified portfolio to mitigate risks and to seize opportunities,” Mr Green said.
The CEO believes that older investors embracing the digital currency will continue to help drive the price of the assets.
“Baby Boomers and Gen X, who own most of the world’s wealth, are embracing the cryptocurrency revolution. This will serve to further bolster prices in the market in the longer term.”
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