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Money Choice: Why I choose to invest in cryptocurrencies

·4-min read
Kelvin Chen, Kent Ridge Health CEO (PHOTO: Kelvin Chen)
Kelvin Chen, Kent Ridge Health CEO (PHOTO: Kelvin Chen)

By Lyn Chan

SINGAPORE — Bitcoin and other cryptocurrencies are almost impossible to ignore now. Once, they were a curiosity, the talking point of many investment conversations. These days, they are a viable investment; at the very least, cryptocurrency seems to be a good place to park some cash.

Dr Kelvin Chen, Kent Ridge Health’s chief executive officer, is a believer in the digital asset. The 37-year-old started investing in cryptocurrencies five years ago. Here’s his story:

“My crypto investing started five years ago, initially in Bitcoin, then in Ethereum and some others, a year later. I bought S$10,000 each of Bitcoin and Ethereum, and I’ve bought more of Ethereum in small parcels since. I was not attracted to crypto per se. It just happened to be a time when early adopters were mostly people in the IT industry who didn’t mind getting freelance work done paid by crypto. When the freelancers I was working requested to be paid in crypto only, I thought I would put in small amounts needed for these transactions. Then, it was cheaper than paying them by the dollar value. It was also exciting because the price could vary wildly all within a day.

Was I ever worried about losing my money? I was initially a sceptic. In the early days, there was merely a smattering of platforms and wallets, and fewer scams existed, compared to now. Many of my friends and relatives have received phishing emails and messages advising them to invest. Nevertheless, I believe that crypto excels as a medium of exchange across borders, and its scalability makes it a viable currency for online transactions. Also, it has better value than traditional futures like gold.

My crypto investments are done through Coinbase, Delta and Coin Market Manager. They provide actionable analytics to make objective trading decisions.

Ethereum is my choice for crypto investing because it is used as both a digital currency and a global computing network which supports applications via its own currency, Ether. Currently, I hold 60 per cent ether, 30 per cent Bitcoin and 10 per cent other altcoins. I am considering investing in Litecoin, Dash, Ankr and CRO.

I cashed out half of my crypto portfolio a year ago amid the COVID-19 crisis. The amount was enough to cover all that I had put in, plus more. What’s remaining is my original capital of S$20,000, and then some.

Liquidating part of my crypto holdings gave me room to examine new initial coin offerings.

Having been in crypto investing for several years, I feel that it is not for the faint of heart – crypto fluctuates a lot. When I first started, I was attracted to a wallet app that was free to use. After putting some cryptocurrency in, I discovered that it was confusing to use — so much so that when I got locked out, I could not get in again. And there was no support. Do not get excited by new platforms that guarantee profits. Do basic market research: There are mock apps that you can use to have a feel without immediately putting in actual money. Also, platforms that have been around longer and given the proper regulatory approval are probably safer.

As for investing, I suggest spreading across in a few assets instead of putting all your capital in a single currency. Be wary about DeFi platforms as they are not regulated. Do your due diligence and prepare for volatility. If you are new, do not put more than 30 per cent of your savings in crypto investing; start small and learn as you go. After all there is still a long way to go for crypto as more institutions such as Mastercard are getting into the game in a big way.

Make sure that the exchange you are using is accredited in your region, many exchanges have geographical restrictions. Familiarise yourself with the different trading orders. It is still prudent to focus on your core investment portfolio and if you have spare cash after that you can buy some crypto."

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