Bitcoin: Virtual money, unreal returns
SA investors are showing greater interest in the digital currency after its 120% return, which made it the year’s best asset class
A little more than three years ago the idea of buying into Bitcoin for investment purposes was akin to saying one wanted to purchase a unicorn. Ludicrous. But anyone who dared believe in the unthinkable then is reaping the rewards now. Bitcoin could prove to be a lucrative alternative asset class for the riskier investor. For the second year in a row it ended last year as the best-performing currency in the world. On January 1 2016 the average price of one bitcoin was R7,307. One year later it had risen to R14,443. It has since retracted and is now trading at about R13,500. An investment in the JSE’s all share index in 2016 would have yielded a flat return. One in the S&P and in gold would have produced a return of about 9%. And yet Bitcoin managed a return of 120%. Luno, the oldest and largest bitcoin exchange in Africa, says there has been a rise in the number of local customers buying bitcoin, as well as a rise in bitcoin-rand trading volumes and in the usage of the currency as a...
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