Is convenient to invest in cryptocurrency baskets?

 

By FintechNews staff

-Investing in cryptocurrency baskets—or token baskets, as others call them—is often considered as the safer and easier way to get into crypto investments. Though it’s still a high-risk investment, crypto baskets can mitigate risks in various ways.

-A cryptocurrency basket can refer to a collection of digital assets—such as cryptocurrencies or tokens—that investors can buy and manage as a bundle.

-By offering cryptocurrencies and tokens in bundles, the new investor can save time and effort as they won’t have to research each asset individually. As a result, the allocation process of building a crypto portfolio takes less effort to accomplish overall.

-Each crypto basket holds multiple different assets much like how a traditional index fund is composed of various types of assets. Thus, by getting a crypto basket, investors can quickly acquire a horde of different cryptocurrencies and diversify their crypto portfolios within a single exchange.

-Cons: 1. Cryptocurrency baskets may not contain the specific assets an investor may want. Thus, certain investors will prefer to research and purchase each type of coin themselves rather than getting a crypto basket.

2- The returns of crypto baskets may not be as high as those that can be gained from investing in single digital assets.

JPMorgan Chase & Co. (NYSE: JPM) is planning to launch a new product that will give investors exposure to cryptocurrency through eleven Bitcoin proxy stocks.A few weeks ago, strategists from JPMorgan endorsed a one percent allocation towards cryptocurrency in a note to clients. The analysts said that such an allocation would serve as a hedge against inflation in traditional asset classes like stocks, bonds, and commodities.

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