- Purchasing Bitcoin is low maintenance and risky, but it has a profitable return.
- Purchasing real estate is a long-term investment with the potential to generate a steady income.
With an average 30-year fixed-rate mortgage interest rate of 7.27%, refinancing and home purchase applications have dropped significantly. The prices of houses may increase if inflation continues to grow, which suggests that investing in houses in residential and urban areas is a safe haven for investors in this economy.
There are challenges faced by the venture capitalists, like the fact that they recently came forward stating that Instacart’s initial public offering, which established its valuation at roughly $10 billion, is significantly lower than its $39 billion peak valuation. There is a recurring need for a store of value in the investor’s market due to the shift in investor metrics.
Bitcoin does not, like other cryptocurrencies, grow through user base and fees and hence it is rightfully said that Bitcoin itself can function as a money reserve system for banks and nations. This shift in perspective highlights the need for a reliable store of value. Unlike precious metals with auditing challenges, Bitcoin and cryptocurrencies can fill this role regardless of everyday user adoption.
“Mortgage applications decreased for the seventh time in eight weeks, reaching the lowest level since 1996. Given how high rates are right now, there continues to be minimal refinance activity and a reduced incentive for homeowners to sell and buy a new home at a higher rate,” says Joel Kan.
Instacart’s shares are trading under the ticker symbol “CART.” The IPO is a long-awaited step for Instacart, which was founded in 2012. The company filed privately for an IPO in May 2022 but delayed those plans last fall when the markets were roiling due to recession fears.
Risks and ‘Taking Chances’
The Instacart IPO is a bad lesson for venture firms since the grocery delivery company is set to deliver losses for the private investors who piled on late. When Instacart lists in the coming week, it will leave many of its later investors with significant paper losses, a sign of the pain venture capitalists are facing after years of fast and loose spending.
The grocery delivery firm is targeting a valuation of as much as $10 Billion – lower than the $39 Billion valuation that peaked at the time of startup funding two years ago.
“Private investors going forward need to embrace the new reality of a reset valuation world. There will be a lot of down round IPOs’ ‘ Were the words of Byron Deeter, a partner at Bessemer Venture Partners.
Any level of risk associated with a particular investment or asset class correlates with the level of return the investment may achieve. The right investment for you depends on your own financial background, your familiarity with the asset, and how much you are willing (and able) to risk.
Putting it this way, the purchase of Bitcoin is low-maintenance comes with high risks, and has a strong potential for a highly profitable return. The purchase of real estate is a long-term investment with the potential of for steady income or, in the worst-case scenario, taking it all down the road.