Crypto Investors Should Be Ready to Lose All, Says BlackRock

The chief investment strategist of the largest asset management company in the world has said that cryptocurrencies could be proposed only to those ready to accept total losses.

Richard Turnill, chief investment strategist at US asset management giant BlackRock, believes that Bitcoin and other cryptocurrencies should be considered only by those prepared to lose their entire investment. According to him, cryptocurrencies would not become “part of mainstream investment portfolios soon.”

BlackRock, the world’s biggest player in its field, published on Monday its weekly report, with author Turnill sharing his views on the state of cryptocurrencies.

“We see cryptocurrencies potentially becoming more widely used in the future as the markets mature. Yet for now we believe they should only be considered by those who can stomach potentially complete losses,” he wrote.

The strategist noted that the main reasons crypto coins remain outside mainstream portfolios are their high volatility, the lack of regulation, and the fragmented market. The report compared the volatility in US stocks, gold, and the top three coins: Bitcoin, Ethereum, and Ripple.

BlackRock, which managed $6.28 trillion in assets as of December 2017, does not seem to be interested in the emerging market of cryptocurrencies. However, Turnill left the door to the crypto space open, saying it has to overcome several challenges to reach wider adoption. He anticipates that G-20 countries would launch regulatory standards for cryptocurrencies during a meeting scheduled for March.

Although even crypto skeptics give blockchain positive reviews, Turnill said the technology would need serious changes in software development to get wider adoption.

In October 2017, Turnill told Business Insider that Bitcoin and other cryptocurrencies exhibited the characteristics of a bubble. He noted that it was challenging to value Bitcoin fairly given there was no right or wrong price for it. However, the BlackRock strategist admitted the company was considering blockchain for various use cases.

“I think it’s a technology which is going to get more and more adoption over time,” he said then.

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