As with most other asset classes in 2022, the value of NFTs and cryptocurrencies cratered this year, as fears about inflation, the war in Ukraine and fraud pushed investors away. While some, like Ric Edelman, have been bullish on the cryptocurrency space, others, like economist Nouriel Roubini, urged advisors—and investors—to stay away.
“In the case of bitcoin or any other essentially cryptocoin asset, the basis for the fundamental value and the basis for the capital gain is not there, it’s vaporware; it’s not backed by anything,” Roubini said at this year’s Inside ETFs conference. “They’re not currencies, they’re not even assets, they’re highly volatile, they’re speculative and they’re subject to manipulation of one sort or another.”
One such manipulation involved cryptocurrency exchange FTX, which filed for bankruptcy in November, causing many crypto assets to go into freefall. Bitcoin, for instance, which was worth more than $47,000 in March, has dipped below $17,000 nearing the year’s end.
Despite the FTX debacle, there is still demand for these type of assets. The slate of digital trading cards put out by former President Donald Trump recently sold out in just a day, and the resale market for them has soared.
While many advisors do not recommend cryptocurrencies to their clients, that hasn’t stopped investors. According to The Ascent, 56% of American adults are invested in, or have previously invested in, cryptocurrencies. For that reason, WealthManagement.com has devoted a fair share of its coverage to the space.
Click through the slideshow to read up on how it’s been covered.