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Let's face it.

We all know this already.

Crypto is a lot of things.

But is it an asset?

To answer that question,we need to know what an asset is.

An asset is, in the simplest way possible,anything that puts money into your pocket passively.

It could be your business.

Or your gold coins when they appreciate.

Or your real estate.

Or your stocks and bonds.

Ok cool.

Crypto has put money in my pocket dozens of times.

It's got to be an asset right?

Ehhhh....not so easy.

See we tend to classify crypto as an asset class.

Whereas it simply comprises multiple asset classes,and isn't an asset class itself.

Ok, what the heck is an asset class?

Well, an asset class is a group of financial instruments which have similar financial characteristics, and behave the same way in the market place.

Examples are stocks, bonds and real estate.

So crypto comprises Bitcoin and other cryptocurrencies.

Including the ones that are outright scams,and the ones that will never cost more than a few pennies.

So therefore, in the end, crypto is merely a means by which other assets are created and delivered.

Just look at ripple.

They sign deals with multi billion dollar financial companies who have absolutely no holdings in crypto.

The ripple currency was created as a means for Ripple labs to find funding for their major projects.

And in return give more value to their currency, while holding a shit ton of it.

That's a classic example of crypto being a means to an end.

All this is well and great.

But can crypto be referred to as an asset?

First, for something to be called an asset, it must have both intrinsic and extrinsic value.

In other words, it must be pegged to something of a greater value than itself. And it's holders must also have faith in it's ability to work, and put money in their pockets.

Bitcoin has only intrinsic value. Cause we all have faith it'll rise to a crazy price someday.

But there's no extrinsic value. It isn't pegged to money or gold or land. It's just.......valueless in the eyes of seasoned investors.

And for good reason.

Sure, there may be better alternatives to bitcoin as the major crypto in the future.

Alternatives pegged to something.(like the USD tether and Chinacoin both pegged to the US dollar and Chinese yen respectively.)

But for now, unless you're holding any of those two crypto coins, crypto really isn't an asset.

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