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The CEO of venture capital fund Brevan Howard said that he invests in different sectors of the cryptocurrency market to get the greatest profit with minimal risks.
Alan Howard, in an interview with The Block, stated that he knows a way that ensures that “your revenue stream will never depend on just one strategy, topic or human factor”:
“Cryptocurrencies have become an asset class that will influence the development of technology and the economy for many years. Since this is a new asset class, I argue that it is most reasonable to diversify your risks by investing in the entire crypto ecosystem at once.”
The British billionaire warns that working simultaneously in the stock and cryptocurrency markets can prove challenging for those investors who have historically been focused on either the first, largely illiquid asset class, or the second, which can be easily sold.
It’s a new paradigm that all venture capitalists are now adjusting to, Howard says. It creates a “powerful feedback loop that allows you to analyze information about market trends and create opportunities for new market participants”:
“In cryptocurrency markets, unlike traditional ones, venture capital investment and liquid trading should be considered as part of one whole, and not as two separate areas, since project tokens are publicly distributed much earlier than the finished product.”
One of the reasons why some investors are in no hurry to invest in cryptocurrencies is that it is more difficult to manage digital assets than shares that are not included in the listing, the investor argues. Apart from the fact that prices are constantly changing, tokens often provide their holders with the opportunity to influence the direction of development of crypto projects through voting and can be used to generate income.
Recently, Binance CEO Changpeng Zhao (Changpeng Zhao) said that against the background of a falling market, it is short-sighted to invest in one or two cryptocurrencies, it is better to diversify the portfolio as much as possible.
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