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Reasons why S.A investors are betting big on Bitcoin
South African investors are showing greater interest in Bitcoin. This is after the digital currency gave investors returns of 120 per cent, making it the best asset class of the year. Werner van Rooyen, Head of marketing, BitX, which is the oldest and largest bitcoin exchange in Africa, joins CNBC Africa for more.
Wed, 25 Jan 2017 08:07:46 GMT
Disclaimer: The following content is generated automatically by a GPT AI and may not be accurate. To verify the details, please watch the video
AI Generated Summary
- The surge in Bitcoin's popularity in South Africa is fueled by increased infrastructure, merchant adoption, and a favorable regulatory environment.
- Bitcoin offers investors a non-correlated asset class in a fragile global economy, attracting funds seeking alternative investment options.
- Despite the benefits, investors must be cautious of security risks and regulatory challenges associated with Bitcoin investments.
South African investors are increasingly turning their attention to Bitcoin, with the digital currency delivering remarkable returns of 120%, making it the top-performing asset class of the year. Werner van Rooyen, Head of Marketing at BitX, the oldest and largest Bitcoin exchange in Africa, shed light on the factors fueling this surge in interest. According to van Rooyen, the growing infrastructure supporting Bitcoin, increased merchant adoption, and a more favorable regulatory environment are key drivers behind the cryptocurrency's popularity. Furthermore, in a fragile global economy, investors are seeking alternative asset classes, leading to a growing influx of funds into Bitcoin. Despite the political and macroeconomic instability globally, Bitcoin remains largely unaffected, offering investors a non-correlated asset class to diversify their portfolios. However, van Rooyen highlighted the risks associated with Bitcoin investments, particularly in terms of security and regulation. As an unregulated instrument, investors must be cautious of the storage and handling of their Bitcoin to mitigate potential risks. When it comes to the utility of Bitcoin as a form of payment, van Rooyen mentioned that the digital currency is primarily used in online transactions, with a growing number of internet retailers accepting Bitcoin as a payment method. In South Africa, popular online stores such as Takealot.com and payment processors like PayFast are embracing Bitcoin as a means of payment. Looking ahead, van Rooyen emphasized the potential impact of Bitcoin exchange-traded funds (ETFs) on the market. Similar to the effect of gold ETFs on the gold market, Bitcoin ETFs could attract more institutional investors and increase liquidity in the Bitcoin space, ultimately influencing the price of the cryptocurrency positively. While the future performance of Bitcoin remains uncertain, van Rooyen expressed optimism about the currency's outlook, fueled by ongoing innovations and growing institutional interest in the asset. As South African investors continue to bet big on Bitcoin, the cryptocurrency market is poised for further growth and development in the coming years.
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