BlackRock: Cryptocurrencies Have Potential, But They Are Risky Assets Now

February 27, 2018

One of the largest investment companies in the world BlackRock believes that cryptocurrencies will play a more important role in the future, and so will blockchain technology, although currently there are serious barriers on the way to their development. This was written by global chief investment strategist of the company Richard Turnill and published on the website of BlackRock this Monday.

He stated:

"We see cryptocurrencies potentially becoming more widely used in the future as the market matures. Yet for now we believe they should only be considered by those who can stomach potentially complete losses. Similarly, blockchain needs to overcome significant hurdles to reach its promising future."

According to the strategist, cryptocurrencies have prospects, but at the moment they are volatile and may be considered as high-risk assets, which makes their integration into investment portfolios a dicey initiative.

Turnill noted that blockchain technology has opportunities to completely change various global industries. However, he also said that this integration will not be smooth, therefore it is necessary for financial regulators and central banks to be involved in this process. 

He wrote:

"Take the financial industry. A blockchain-based, single shared financial database could eliminate inefficiencies and risks associated with human processes, but adoption at scale would require a massive shift in software development and a well-constructed maintenance model."

The strategist discussed cryptocurrency not for the first time. Back in October 2017 he stated that cryptocurrency markets are dangerous and could become bubbles and that there are no real way to determine the fair value of bitcoin and other cryptocurrencies.

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