Nothing should be taken as financial or investment advice. Enjoy the ride.
Robin Lee, the founder and CEO of the Sharia compliant fintech company HelloGold based out of Singapore, says investors should start to hedge into gold as the markets shift. Historically, Bitcoin and the rest of the market should now turn to retrace after their massive gains since April targeting the $8,500 level. Instead of simply shorting your assets into a stablecoin, Robin suggests investors learn to hedge into the gold market to combat standard inflation.
Gold has always been a stable commodity to hedge against any market decline globally or domestic. The main purpose of the gold is to do more than just hold the cash value of your wealth. Traditionally, most investors are 50% cash and 50% investments. Holding cash is not a bad decision, but people could be maximizing their returns by holding a percentage of those cash reserves in gold for the time being as gold has historically out preformed or stayed levek with the rate of inflation on average.
HelloGold (HG) is one solution to this problem for Malaysian investors. Currently, HG has over 100,000 investors utilizing its platform using its first gold investment vehicle product. In the future, the company does want to offer other services or commodities to invest in, but right now they are focused on capitalizing on their recent approval as a Sharia compliant company and product. This basically enables the product to be offered in the Middle East and more specifically, Dubai, the investor hub of the world.
Definition of “Shariah compliant”. An act or activity that complies with the requirements of the Shariah, or Islamic law. The term is often used in the Islamic banking industry as a synonym for “Islamic”—for example, Shariah compliant financing or Shariah compliant investment.-Islamic Markets
Although HG is surging in adoption, the original purpose of the project was one with a heart felt cause. The main purpose of HG is to offer an investment vehicle to the undeserved populations of the world.
Gold is an incredibly valuable asset to have in your portfolio, regardless of how much money you have to invest.-Robin Lee
These countries are known to have hyper inflation which can quite literally diminish someone’s life savings over night. This has happened multiple times for countries like Malaysia, Turkey, Venezuela, and many more. The effects of hyper inflation most of the time are life altering for everyone in the country. Companies have to turn to almost any means of trade or exchange and individuals are left with little choice than to work for the rest of their lives to make up for their financial damages. By giving these countries citizens an option to hedge their savings into gold, this could prevent the devastation of hyper inflation on an entire population.
Should Investors Turn to Gold
Robin Lee is the former CFO of the Gold Council which handles one of the largest gold reserves in the world. He has also been apart of the SEC commission of Malaysia for multiple years. It is a safe bet that he knows what he is talking about when he discusses gold. He can be considered an expert on the topic.
Therefore, if Robin thinks now is a good time to hedge into gold, then investors may want to do some research on the topic. Speculatively, the world markets could soon go through a very harsh recession. Since 2008, almost every market around the globe has seen immense growth, and the world wealth levels are at all time highs never seen before in the history of the world. This is great, but how will the crypto market respond when the tides turn? What goes up, will usually come down at some point.
A common belief among the crypto community is that when the market goes south, investors will hedge into Bitcoin and crypto assets as a means to escape the collapsing economy structure. The problem with this line of thinking is, it has never happened. You see, Bitcoin came into existence after the last stock and housing market crash in early 2009. The crypto market has never experienced a global economic melt down, and how it will preform, is pure speculation. Therefore, if the markets decided to turn, it would be wise of most investors to have an “escape plan” for a percentage of your portfolio. Traditionally, this would mean investing in commodities similar to gold, silver, and platinum.
From an economic stand point, Bitcoin should preform the same way as physical commodities, but no one knows. It is basically anyone’s guess at this point, and only time will truly tell how the crypto market fairs during the next global meltdown.