I live where government authorities are trying to treat Crypto as an asset class. They want to treat it as a high-income asset where even the hold of such asset will be considered an asset class.
I know many people who hold enough Crypto to treat it as a side hustle or income stream. Like they get enough rewards out of the staking and delegation. So for them, it is already an asset class.
Crypto vs Debt
Debt instruments have a specific amount set which rarely changes. When it changes, you can consider that the outward market is in bad stages. Say some instruments pay you 7 percent. You get kind of an assured income from this.
On the other hand, Crypto could make your investment 2x or 3x the initial deposit. So there is also another point when it can go down the same 2x or more. It all depends on the market time. Still, Crypto beats debt.
Crypto vs Equity
We can say equity has Crypto as it is one of the components. However, the mainstream media and the market do not consider it as one of the asset components. So the Equity market has this volatile pattern where you get the returns of that type.
Crypto also has some such patterns where you can get high returns, or it can go into the negatives. However, you can often do market analysis with the equity, something you cannot do in the case of the Crypto for the investment.
Crypto vs Funds
Let us take a case of the funds, be it mutual funds or ETF funds. You may find that they are kind of second to the debt funds. In that context, you may find that the percent you get out of the funds investment is secure but sometimes volatile if it has equity.
However, with Crypto, you can say that you get much better returns than the funds. Crypto has this market-specific value which may bring good returns if you have made a good investment during the market dip times.
Do you think it is an asset class?
Asset classes have this specific value that comes out of it when invested for duration. The same can be said about Crypto. It may not always give a consistent income, but if you are diversified, you are protected in this process.
What is your opinion on Crypto as an asset class?