Trading cards are suddenly selling for $1.3 million. Bitcoin cryptocurrency’s worth just reached $1 trillion. And digital artwork of an animated kitten sold for $69.3 MILLION! Why are these investments so hot at the moment?
Cash infusions in everyday investors’ bank accounts from stimulus payments and a lack of faith in traditional stocks and bonds markets is inspiring some investors to buy into extremely risky asset categories.
They’ve even gotten creative with their research.
Some people are manically flocking to online communities like Reddit and Discord, or spending hours on tech tools like trading apps Robinhood or Coinbase, to uncover which investment – from rare collectible sneakers to digitally authenticated nonfungible tokens (NFTs) – would hit pay dirt next.
While the frenzied activity is exciting, many experts say it’s more like gambling than informed investing. “It’s just a pent-up cycle where the money has nowhere to go, so it’s doing stupid things,” investor, entrepreneur and market commentator Howard Lindzon told the New York Times.
Is it “stupid” to take a chance on an unusual asset like say, trading authenticated basketball highlight clips – another kind of NFT? That has yet to be seen.
Remember: if you’re betting on faith that a hobby, nostalgia, other unique interest, or a traditional investment will pay off, only invest what you can afford to lose!