Bitcoin [BTC] and cannabis might meet the same fate, according to market speculators

image

Tilray INC, a pharmaceutical company and a cannabis producer, witnessed a surge to $200 in their stock price in the month of September 2018. The premium medical cannabis provider had become more valuable than CBS, an American broadcast network, and American Airlines, according to a report by Forbes.

Some of the reasons for the volatility is because the direct marijuana investments are very low and only a few companies in the United States of America publicly trade cannabis. Another major problem for Tilray is the legalization of cannabis in Canada, which has been attracting a lot of investors. Furthermore, Tilray released a small number of shares during its Initial Public Offering [IPO].

These reasons have resulted in a speculation that the price of Tilray and several other cannabis companies might witness a similar price movement to that of Bitcoin. The cryptocurrency’s price surged to $20,000 in the month of December 2017 and following which, it dropped by 60% within a few weeks, affecting many investors. Furthermore, the platforms are usually “deeply misunderstood” and are “mysterious”.

According to the report, Bitcoin and cannabis stocks have few common factors. One of the major differences between them is that Bitcoin was neither a regulated medium of exchange nor was it widely accepted by the general mass. This reason might have instigated the price of Bitcoin to crash.

On the other hand, marijuana had a strong and established market. About 9.5% of adults had reportedly been using marijuana in 2015, which was almost double the rate of usage a decade ago. In addition, reports claim that the usage might increase in the near future with the shifting regulatory policies and softening public opinion.

The volatility of Tilray should not be considered as an act of forfeiture by investors in the cannabis industry, whereas, “it’s more of a reflection of the unique dynamics hovering over one company”. Thus both Bitcoin and cannabis industries are very volatile and are new to the market. They have huge potential for growth but might not necessarily have a huge growth potential. The report added:

“The rewards could be high, but so are the risks, making pot perhaps the ultimate caveat emptor investment opportunity that exists today”

Follow us on Telegram | Twitter | Facebook


Related Topics:

Don't Miss

Ethereum [ETH]’s Vitalik Buterin discusses use cases of on-chain governance

image

Original author: Ajay Narayan
Coinbase Pro Adds 0x (ZRX) Token Ahead of Mass Rol...
0x (ZRX) Listed On Coinbase Pro

Related Posts

 

Comments

No comments made yet. Be the first to submit a comment
Already Registered? Login Here
Guest
Saturday, 17 November 2018
If you'd like to register, please fill in the username, password and name fields.

Related News

26 September 2018
XRP - Ripple - News
XRP/USD 60-minute chart. Spot rate: 0.54970. Relative change: +4.80%. High: 0.57454. Low: 0.48367. T...
26 September 2018
XRP - Ripple - News
Ripple (XRP) has powered back to retake its position as the world's second largest cryptocurrency by...
26 September 2018
XRP - Ripple - News
The declines in the past couple of days had XRP/USD break the support at $0.58 and $0.52 respectivel...
26 September 2018
XRP - Ripple - News
Investing.com - XRP was trading at $0.56245 by 07:18 (11:18 GMT) on the Investing.com Index on Wedne...
26 September 2018
XRP - Ripple - News
XRP rebounded sharply on Wednesday after Coinbase announced a new asset listing process, fueling fre...