The analysts concluded that cryptocurrencies are close to a mass adoption phase and still attract small and large investors. They explained that only 1% of citizens worldwide had access to the Internet in 1995, like what happens with the current crypto market.
Analysts from banking institution Wells Fargo made a report detailing the current development stage of the cryptocurrency market. The results from the study helped them determine whether it is too late to start investing in cryptocurrencies.
The experts concluded that cryptocurrencies are a financial instrument close to a phase of mass adoption. Likewise, Wells Fargo found that small and large investors still feel attracted to those digital assets.
They explained that, even at the beginning of 2022, cryptocurrencies are in a not too early development stage. The high volatility of cryptocurrencies in recent months allowed them to prove that.
The institution compared the volatility of Bitcoin against that of gold, the US dollar, and MSCI market indexes. Many investors use the latter to measure the health of the actions of the world market.
In addition, the volatility of Bitcoin caught the attention of analysts, as those drastic changes in the BTC price reflect its lack of maturity.
The Growth of Bitcoin Will Be Similar to That of the Internet in the 1990s
Wells Fargo stated that the cryptocurrency market would continue to grow exponentially as the Internet did in the 1990s.
The report from the banking institution says that the creation of the Internet occurred in 1983. The analysts explained that only 14% of Americans and less than 1% of citizens worldwide had access to that technology in 1995. Curiously, the position of the Web in 1995 is similar to that of the current cryptocurrency industry.
The experts also highlighted the similarity in the growth rate of Internet users and cryptocurrency traders.
The analysts consider that investors want to know whether the world is ahead or behind in cryptocurrency investments. They believe that the investment on the Internet in the late 1990s seemed reasonable, as it reached a hyper-adoption phase and has never looked back.
In addition, Wells Fargo warned that many projects could disappear in the context of market development. The analysts recalled the crypto winter following the rise to USD 20,000 in the price of Bitcoin in December 2017. At that time, around 40% of the cryptocurrencies on the market ceased to exist.
Education Is Necessary Before Investing in the Cryptocurrency Sector
The analysts stressed that traditional and institutional investors should learn everything possible about the cryptocurrency market.
They acknowledged that the traditional stock market has a limited number of cryptocurrency-related investment products. They also explained that futures rather than digital assets back the current investment products listed on the US stock exchange.
The experts stated that they do not recommend investing in mutual funds, ETFs, grantor trusts, and speculation on individual cryptocurrencies. They said they hoped greater regulatory clarity in 2022 would provide new higher-quality investment options.
The American banking institution considers that it is neither early nor late to start investing in cryptocurrencies. Besides, they believe that their massive adoption is underway and may have already reached a positive turning point as the Internet did in the 1990s.
By Alexander Salazar
