With the concern in the crypto-verse regarding the ongoing crypto market turmoil caused by the Coinrail hack and 4 crypto exchanges being investigated by the CFTC, Ethereum World News managed to get the insight of a seasoned investment expert, Brenda Whitman, who deals with IRAs (Individual Retirement Accounts) centered on precious metals and cryptocurrencies.
Ms. Whitman is a Registered Financial Consultant and the Interim CEO at Coin IRA as well as its parent company of Goldco. CoinIRA, has tailor made Bitcoin IRAs that can be bought using traditional IRA or 401k pension accounts. Ms. Whitman has over 13 years experience with precious metal and cryptocurrency IRAs. She was very optimistic about the cryptocurrency industry and was quick to reference the current turmoil as ‘growing pains’.
She had this to say with regards to the above and the CFTC investigations causing a bit of uneasiness:
The cryptocurrency industry is still in the throes of a massive growth spurt. That means that there will be some growing pains, among them the price volatility that concerns a lot of investors. That has also manifested itself in CFTC’s investigation into possible price manipulation on or by exchanges. It’s the fear of cryptocurrency trading being a rigged game, more than fears of hacking, that has led to recent selloffs and price drops.
She also expressed concerns that the lack of direction by the SEC was causing further uncertainty:
The major unknown going forward…is the threat of regulatory action. Government agencies have accepted that cryptocurrencies are here to stay, but that doesn’t mean that some of them won’t be subject to further regulation.
With respect to the current discussion of both Ethereum and Ripple being classified as securities, Ms. Whitman mentioned that:
If SEC rules those to be securities then it could push future cryptocurrency development further along the model of Bitcoin rather than that of Ethereum.
This is due to the fact that the Ethereum project was itself a crowdfunded endeavor. The platform in turn provides an avenue for ICOs which are also crowdfunded projects. This then might classify Ethereum and subsequent ICOs, as securities worthy of regulation: a process that might cause a legal ripple effect on most crypto projects that started out as ERC20 tokens.
She however mentioned the reluctance of regulatory bodies to act on such and the effects of the delay on the crypto-markets:
But given how slowly regulators tend to move, we foresee underlying market forces remaining the major factor in driving cryptocurrency prices higher in the immediate future.
When asked about the general direction of the crypto-markets and the discussion of Institutional investors deciding to invest in the crypto markets, she said that:
With stock market stagnation, Federal Reserve monetary tightening, and higher interest rates, the stage is being set for a cryptocurrency breakout as more and more investors will move out of stocks and bonds and look to alternative assets to protect their investment wealth.
In a nutshell, the crypto-verse is experiencing some growing pains such as hackings and investigations by regulatory authorizes. However, as the regular stock markets continue to stagnate, traditional investors are bound to switch to the crypto markets in search of more profitable investment options.
Disclaimer: This article is not meant to give financial advice. It is an opinion piece. The opinion herein should be taken as is. Please carry out your own research before investing in any of the numerous cryptocurrencies available.
[Photo source, finance.yahoo.com]