Hasan Shahid is a technology entrepreneur and investor from Toronto, Canada. His resume includes work for such companies as Microsoft, GE, Nissan, Pfizer, and Procter & Gamble. He recently spoke to Miner One about investment in bitcoin and mining  

Hasan Shahid recently joined Miner One’s Advisory Board. Miner One speaks to Shahid about bitcoin and mining.

Miner One: How great is the effect on bitcoin prices of what’s being said in the news?

Hasan Shahid: Bitcoin shows patterns of trading based not on the fundamentals of technology, but on what people hear. For example, late 2017 was the time when the word about bitcoin spread through the masses. A certain dollop of FOMO [fear of missing out] propelled the market’s movement and the price of bitcoin skyrocketed.

This year we observe quite a different situation. News about looming government regulations, China’s plan to crack down on cryptocurrency activities, and other factors have put the market into a downward spiral.

However, it’s only natural that there has to be some consolidation after any stock or market moves up so fast. It’s what we are seeing right now. If you look at the bitcoin price history, it had many crashes before. This one is not unique. The thing is that we now need some very positive news for bitcoin to rise.

Miner One: Should people keep investing in cryptocurrency?

Hasan Shahid: One piece of positive news that could propel the crypto market upwards would be an announcement that someone is introducing the first bitcoin exchange-traded fund (ETF). Currently, buying bitcoin is very difficult and confusing for the average person. One needs to do research to open a separate account and to understand how everything functions.

Last year the SEC [US Securities and Exchange Commission] rejected an initiative to launch the Winklevoss bitcoin ETF. It cited the lack of regulations between exchanges as one of the major concerns. However, in the near future the situation might take another course. After last December’s boom, the SEC might reconsider its strict approach to bitcoin ETFs-to-be. Currently, the SEC is looking at the cryptocurrency carefully and sees it as a very important market.

Since we are in the early stages of blockchain and cryptocurrency adoption, we need a vehicle for retail investors to make bitcoin more approachable. As a result, a new tool would spur the market to mature.

Miner One: Since bitcoin fluctuations will remain, is it better to “HODL” or invest in mining?

Hasan Shahid: As is the case with all breakthrough innovations, constant change is inescapable. In the long run bitcoin might become more stable. But for now, it will remain very volatile. That said, the wild fluctuations don’t favour the “HODLing” approach as the best way to collect your profit.

Crypto mining, on the other hand, has the potential to cushion bitcoin’s volatility and still deliver considerable amounts of profit. Looking at bitcoin’s price rallies, one needs to be realistic. After the dramatic drop from $20,000, bitcoin is still trading at about $7,000. Investing in professional mining operations seems like the most profitable and secure way to direct your investment in crypto.

Miner One: Do you believe bitcoin and blockchain are the future?

Hasan Shahid: Currently, bitcoin has captured the attention of many governments, institutions, and big banks. To boot, we’ve also seen a record number of cryptocurrency hedge funds being formed in the last six months. The changing perspective of political and financial authorities is a serious indication that bitcoin is not going anywhere.

Since cryptocurrency is just one possible application of blockchain technology, other significant developments are starting to take place, especially in government services. For example, applying blockchain to elections makes the voting procedure more efficient, auditable, and transparent. The same holds for property registration.

Blockchain technology can bring management of many processes to a higher level. And just like the appearance of the Internet forced newspapers to go online or otherwise perish – an industry that resisted the change until it had to adapt. Similarly, financial institutions are probably uneasy about mainstream adoption of bitcoin because they fear they might be replaced or would need to adapt.