This is an on-off and on the question that does crop up and financial advisers do indeed have much interest in this query. Bitcoin has always shown an upward trend and does offer high profile “initial coin offerings”.
Yet, advisers usually do not recommend investing in digital currency or in the few investments vehicles that have cropped up. There are indeed a number of market and regulatory risks that are inherent in trading cryptocurrencies. Bitcoin and similar digital currencies may also offer the investment opportunity in the coming future according to users. As of now, digital currencies do remain speculative.
Ups and downs
Bitcoin has been facing price swings that are related to security breaches, hacking and regulatory scrutiny as well as action. Fluctuations in value have been there and regulatory uncertainty happens to be another risk factor. Government authorities can restrict or control the use as well as bitcoin or other digital currencies. The focus is on investments. Regulatory-based approval of cryptocurrency investment funds could indeed bring legitimacy to the asset, or even rejections could shake the existing investor confidence.
There are risks involved while tracking the price of cryptocurrencies such as failure to track the currency closely, and illiquidity.