Online searches like “the best online investments in 2020” have become common especially during the lockdown.
With a lot of spare time at home, many are waking up to the realisation that virtual currencies could be formidable digital assets worth betting on. But just like conventional investments such as stocks, some cryptocurrencies are more popular and are more investable compared to others during tough economic times.
A survey by a top UK watchdog found that at least 2.6 million residents bought cryptocurrencies in the recent past. According to the UK’s official financial services regulator Financial Conduct Authority (FCA), there is a significant increase in crypto awareness and coin owners.
“We estimate 3.86% of the general population currently own cryptocurrencies. This amounts to approximately 1.9 million adults with the UK population (over 18) taken to be approximately 50 million. The research findings highlight a statistically significant increase … from approximately 1.5 million people to 2.6 million people,” reads a section of the survey report. The narrative is shifting from the usual “stocks to buy now” to things like “ the best cryptocurrency to invest in 2020”.
With that, the question in the minds of many is perhaps one: where is everyone investing?
The UK’s favourite cryptocurrencies in 2020
Savvy business people will tell you to trust and follow your intuition when investing. The same seems to apply for the UK crypto traders. Below are three of the most popular cryptocurrencies this year:
2020 has marked one of the major milestones in the history of bitcoin (BTC). It is in May this year that as the norm after every four years, bitcoin rewards are halved. This meant that the founding and major Bitcoin developers would be offering 50% lesser rewards – effectively slashing 6.25 BTC off the current 12.5 BTC reward for each verified block.
Additionally, experts expect Bitcoin to raise the dominance index to 65-70% when contrasted with other altcoins. As such, Bitcoin’s market share is set to soar, impacting its price in 2020 and beyond. At the moment, bullish Bitcoin seems to be headed right back above the $11,000 mark.
Ethereum’s (ETH) role goes beyond that of any digital currency, unlike its peers including Bitcoin and Litecoin. ETH features practical smart contracts used to decentralise transactions. Investors anticipate a jump in its price this year due to increased demand for its blockchain on top of its underlying asset.
Unlike BTC, ETH’s demand is expected to be driven largely by what its tech can do for the world rather than its currency status. The Proof-of-Stake algorithm and the incoming fork updates are also expected to be major drivers of ETH’s market price this year headed to 2021. As of 7 Sep, 06:39 UTC, Ethereum traded at £292.38.
Cointelegraph has recently reported a positive outlook of EOS by Chinese analysts. The experts are said to exude confidence in the future of the coin at least for the next couple of years.
It seems EOS is a worthy investment in 2020 even for those with little knowledge of the digital currencies.
The coin’s infrastructure has perfected on ETH’s downsides – especially with scalability issues. EOS’s infinite number of similar blockchains coupled with its consensus algorithm of delegated proof of ownership (DPoS) have made it a perfect alternative to most cryptos.
Data suggests that more than half of crypto purchases in the UK were made using online tools such as PrimeXBT. FCA’s research indicates that approximately 77% of the interviewed crypto buyers did so using online exchanges with only 5% transacting on UK-based exchanges.
The Boris Johnson-led government this year announced it would “consult on bringing certain crypto assets into the scope of the financial promotions regulation.”
The UK’s approach to crypto regulation has been measured in the past, although no laws have yet been formed even as involved exchanges operate under a set of regulations.
In essence, the crypto sector is fast-growing, becoming more popular and whether cryptocurrencies will find their way into the country’s “good books” remains to be seen.