I want to start this with the Conclusion. One type of investment will not replace another. If yes, we would have seen similar things in history. Each one has some specifics that makes it unique. Each type of investments has its place.
Each investment has a market cycle. A bull cycle, a bear cycle. Repetition. At one time, a particular investment could be in a bull phase, another one in bear phase. So, there could be money flow from the bear phase investment to the bull phase investment – it is quite natural. People want the best bang for their bucks!
Chinese domain investments are at the bottom of a bear phase. CryptoCurrencies are having a bull phase. I was able to influence about 100 domainers for cryptocurrency investment, but the vice versa is not very encouraging. So, definitely there is money flow happening from domain investors to Cryptocurrencies.
Cryptocurrency investments cutting into some of the advantages of Chinese domain investments
One of the reasons I always say that makes domain name investments lucrative is the ease of investment. It is digital. It does not require paperwork. You can keep your assets in digital form and take it where you go. Your investment can be anonymous and it only requires a few click of buttons. It was domainer’s pride, but not anymore. CryptoCurrencies offer the same.
Another one is you could park huge amount of fiat value in a single domain name. Also in Cryptocurrencies, there is literally no limit in how much you could park in digital form.
Advantages of Cryptocurrency investments over Chinese domain investments:
1. The major advantage is that there is no maintenance fee. You can hold it for life with no additional cost, unlike domains.
2. Change to any type of cryptocurrencies at any time with a click of few buttons. You could change from Bitcoin to Litecoin, Litecoin to Monero, Monero to Bitcoin. It is seamless.
3. Cashing out is faster. Most of the countries have bitcoin exchanges that will help people convert to fiat, so you just have to take your proceeds in bitcoin and cash out.
4. Invest in minute fractions. You can invest in any coin for 1$ or 100k. The asset is extremely divisible.
Disadvantages of Cryptocurrency investments over Chinese domain investments:
1. Talk about pump and dump – Cryptocurrency is the best place you will see pumps and dumps in much larger scale. The entire market cap is huge.
2. At this point in time, there are about 900 plus cryptocurrencies. http://coinmarketcap.com/all/views/all/ And this number is increasing day by day in a bull phase with set up ICOs (Initial Coin Offerings).
3. Uncertainty and highly risky. The investment is quite new and has not proven itself. Most of these currencies fail and they disappear into thin air. It is difficult to call the tops. There is huge market cap, more volume, more players. It is difficult to say we are at the peak of the bull phase or it is just the beginning. Often times, the crash is much harder.
4. Security and storage issues. Currencies are stored in online or offline wallets. You don’t own the private keys in an online wallet and you might get hacked. Exchanges can shut down and you might lose your entire holdings. The offline wallet solutions does not support all coins.
5. Comparatively difficult at start. It needs some experience with wallets, addresses, transaction IDs, and some technical terms.
Advantages of Chinese domain investments over CryptoCurrencies:
1. Limited in number.
2. Limited in niche.
3. Regulated and transparent market.
5. Organic growth.
6. Less risky. Safe asset.
7. Easy to invest just like Crypto.
8. Dedicated Chinese investment which their government does not intervene.
9. Growth of internet users in China, govt. support, and the growing need of domain names.
In case you want to join my Cryptocurrency group in Whatsapp: https://chat.whatsapp.com/0xVXHI1xkmr4JndWJJM8QZ
In case you want to join my Chinese domains group in Whatsapp: https://chat.whatsapp.com/KsIx5iptrhYCwbnDcA81fQ