If you bought $100 worth of bitcoin at 10c on the 10th of October 2010, you would have been able to buy 1,000 bitcoins. Today that same investment would be worth an incredible $55m (R853m).

Bitcoin has been on a remarkable trajectory that’s outpaced other investments, including stocks, property and commodities. Bitcoin wrapped up 2020 just a tad shy of $29,000 (R420,000). So far, in 2021, the price has nearly doubled, soaring to around $55,000 (R860,000) as it benefits from increasing institutional adoption. 

Some market observers attribute Bitcoin’s price advance to the strong demand from buyers seeking to hedge against market inflation.

“It’s the best-performing asset of the last decade for sure,” said Sean Sanders, CEO and founder of Cape Town based crypto investment platform Altify, which is backed by JSE-listed Sabvest.

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What’s driving these returns?

Most recently, the price has been driven by high-profile support. Bank of New York Mellon said it would provide custody services for crypto-assets, citing growing client demand.

In February, Mastercard also said it would begin to offer support for cryptocurrencies on its network this year. And, Tesla announced that it had bought $1.5 billion of bitcoin and that it would soon start to accept the currency as payment. Everyday investors have been piling into the Bitcoin and cryptocurrency market, with an estimated 180 million people worldwide engaging with cryptocurrencies.

“We’ve been wondering what it would take to catapult crypto into mainstream adoption, and over the last few months, we seem to have found some answers,” says Sean Sanders. “To say that the past year has been one of the most important in crypto’s history would be an understatement.”

“For those of us working full time in crypto for several years, much of what has transpired this last year felt inevitable. We always believed that large institutions like PayPal would help normalise crypto for everyday use, and institutional investors would come around to this new asset class,” says Sanders.

“What’s remarkable is that it all seems to be happening at the same time. This is becoming a reinforcing cycle, where positive adoption news – like that of PayPal entering the crypto space, or Tesla’s bullish outlook on crypto – puts pressure on other big-name payment institutions and financial firms to do the same.”

Where to from here?

The entire crypto market, up +120% this year, which is ahead of Bitcoin’s 98% gain, is now worth nearly $1.8 Trillion in total, which is just below the value of the world’s most valuable company - Apple.

“While cryptocurrency has now been around for more than a decade, it’s still ‘new’ in the grand scheme of things, and to many, it’s still somewhat of an unknown investment class. At the same time, cryptocurrency is going to continue to evolve. The ways we use it, the ways we invest in it, and the different things it can accomplish will keep changing and expanding in the years to come.

“In the coming months, we expect to see large banks launch crypto custody services, and brokerages open up access to crypto products, to see more retailers displaying ‘We accept crypto’ signs, large institutions building major applications on public blockchains – and we expect investment conversations to transition from ‘Why should I invest?’ to ‘Why aren’t we already invested?’

“As with all new technologies, the journey for crypto will continue to have its ups and downs. Price corrections are to be expected and are healthy. But one thing is becoming clear: crypto is arriving now, and the time to get ahead of crypto’s mainstream breakout is starting to run short. The next six months are likely to change the game.”

He continues: “In just 11 years, bitcoin has gone from nothing to an awe-inspiring creator of wealth. At this point, whether prices go to the moon, stagnate or correct, the cryptocurrency is becoming impossible to ignore in an increasingly dysfunctional global financial and monetary system.

“The growing involvement of major players in the financial services realm supports the staying power of the asset class and validates other people getting involved. I think bigger players better understand that buying bitcoin and putting it in their portfolio is meant to be a store of value, an inflation hedge, digital gold or a digital form of money. This is much better suited to the digital world we live in today versus historical stores of value like gold, which would have been certainly much more applicable to a world characterised by physical exchanges.

How to invest?

Buying the JSE Top 40 index is a proven way to spread risk through diversification and profit from the returns of the 40 largest companies listed on the exchange.

Altify offers the same thing in the rapidly emerging crypto market. Sign-up is simple, the minimum investment is R500, and there are no monthly fees. You can sell your crypto investment at any time and withdraw your funds. There are no lock-up periods like there are with other investment funds.

You have the choice of three crypto ‘bundles’ (similar to unit trusts).

Each of Altify’s bundles has produced exceptional returns on a year-to-date basis, and most have outperformed an investment in bitcoin alone.

What does Altify offer?

Altify offers 3 crypto Bundles to reduce the amount of research you need to put into each individual crypto-asset by using our proprietary software and Bundle methodology to ensure that you always have the top-performing assets in your portfolio by rebalancing our Bundles monthly.

The Top 10 Bundle is like the JSE Top 40 or S&P 500 for crypto and provides equally weighted exposure to the top 10 cryptocurrencies making up more than 85% of the crypto market.

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The Payment Bundle provides equally weighted exposure to the top 5 payment focused cryptocurrencies looking to make payments cheaper, faster and more global. These cryptos include the likes of Bitcoin, Ripple, Bitcoin Cash, Stellar and Litecoin.

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The Smart Contract Bundle provides equally weighted exposure to the top 5 smart contract focused cryptocurrencies like Ethereum, EOS or Tron that enable developers to build applications on top of their blockchains, similar to how Apple builds apps on top of its OS operating system.

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Altify’s Bundles have outperformed an investment in Bitcoin alone over 1, 3 and 5-year time periods.

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Have I missed out?

“As with all emerging sectors and technologies, the journey for crypto will continue to have its ups and downs,” says Sanders. “Price corrections are a natural part of any investment market and are especially natural in the crypto ecosystem. But one thing is clear: crypto has arrived, and the time to get ahead of crypto’s mainstream breakout is starting to run short.”