Money Talks is Stockhead’s regular drill down into what stocks investors are looking at right now. We’ll tap our extensive list of experts to see what’s hot, their top picks and what they’re looking out for.

Today, we hear from Christian O’brien, licensed portfolio manager for US-based HFX pro.


Why is crypto hot right now?

As the global economy shifts towards a digital ecosystem, there are a lot of things that make the crypto space really hot right now, according to O’brien.

Let’s start with the fact it’s already a market worth over $100 billion and experts tip that it will head as high as $2 trillion within the next decade.

“These figures are staggering and shows you how hot this space really is,” O’brien told Stockhead.

“A lot of institutional investors and companies are getting involved in cryptocurrencies.

“For example, in 2018, Intercontinental Exchange — a parent company of the NYSE — partnered with blockchain technology company Blockstream to create a cryptocurrency data feed, and announced their Bitcoin futures platform BAKKT, which is expected to launch later this year.

“Additionally, 2018 was the year Goldman Sachs invested in crypto assets Custody solutions BitGo, and TD Ameritrade backed a Bitcoin futures platform known as ErisX.

“The fact that these institutions are championing the advancement of these assets make it a really hot space for the big players and I think it’s amazing for investors.”


Big trends

Facebook’s plan to launch its own cryptocurrency known as “Libra” will be a “huge trend” in the industry, according to O’brien.

READ: Will Facebook’s Libra finally bring cryptocurrencies into the light?

“It will make crypto use more realistic for the larger population,” he said. “This trend is set to push a potentially 2 billion users market to the crypto space.

“This will give a great boost for mass adoption of cryptocurrencies.”


What not to do when investing in crypto

As with any other investment, you shouldn’t buy without first doing your homework, O’brien says.

Here are some of the other “don’ts” of crypto investing:

    • Don’t view it as a “get rich quick scheme” because it can lead to bad decisions;
    • Don’t make financial decisions based on emotion because this leaves no room for factual and technical analysis;
    • Don’t be complacent when it comes to security, be very conscious to avoid hacks;
    • Don’t be too hasty when investing and don’t indulge the “fear of missing out” (FOMO) mentality;
    • Don’t invest all your money at once. Start moderately and if there is a need to increase your investment with time then you can invest more; and
    • Don’t be greedy.

For those looking to invest in crypto, O’Brien suggests seeking professional assistance.

High risk, but potentially (very) high reward

Just like any other speculative venture, investing in cryptocurrency is “highly risky”.

“This is because they are barely regulated. This makes the values very volatile and based on demand at any particular point in time,” O’brien explained.

“For example, if everyone stops using crypto they would be worthless. All they are worth is what people are ready to offer at any point in time — luckily people are ready to offer a whole lot for cryptocurrencies.

“You can literally lose half of your portfolio in a couple of minutes if you aren’t careful.

“However, this can be maximized into profit through active portfolio management and trading, by monitoring the market using different working methods to know when is best to buy or sell and make good profits.”

While crypto assets are highly volatile, there is the potential to make up to 5x more profit than listed stocks, according to O’brien.

Crypto is also easier to invest in, and anyone can invest in it, unlike listed stocks that may require a lot of formalities.

“Unlike traditionally listed stocks, cryptocurrencies can be traded on a 24-hourly basis and profit can be made at any time depending on market occurrence at that time,” O’brien said.

“Traditionally listed stocks often work for several hours daily.”


So why invest in crypto?

O’brien says that just like any other investment type, the main aim is to make good profits and also prepare for various life stages such as college or retirement.

“Bitcoin is the fastest growing asset in the market right now, that alone should make you want to invest,” he said.

“Some crypto currencies like Ripple and Litecoin have really good purpose behind them.

“There are other cryptocurrencies that are predictably going to be very huge in the future because of their purposes.

“Many big companies are investing; they obviously believe in the long-term outcome. So this tells you that crypto assets are in the right track.”

O’brien says that if your crypto assets are actively managed, you could be on your way to some “ridiculous profits” in years to come.


Christian O’brien has broad experience in business administration and professional portfolio management. He has managed different positions in several crypto companies and also managed many private clients. He has been actively involved with the market since 2002 but started trading professionally in 2006. O’brien started trading cryptocurrencies in 2013.

The views, information, or opinions expressed in the interviews in this article are solely those of the interviewees and do not represent the views of Stockhead. Stockhead does not provide, endorse or otherwise assume responsibility for any financial product advice contained in this article.