Letter To Investors
Dear Investors,
Welcome to our new Smart Portfolios guide for investing in the Web3 world. We've written this guide to help you to understand the basics of Web3 and gain insights into the best ways to invest in this new and exciting world. We believe that Web3 has the potential to revolutionise the way we invest, communicate, work, create, and play. With this guide, we hope to demystify the technology and provide you with the knowledge and tools you need to become a better investor.
2022 was a rollercoaster year for Web3 investing. The market experienced a rapid rise in the first half of the year, followed by a sharp correction in the second half. However, we believe that this is part of the natural market cycle and that the long-term potential of Web3 remains enormous.
Web3 technologies have the potential to be a game changer
Web3 technologies have the potential to be a game changer because their decentralised nature enables greater transparency, security, and accessibility, opening up new opportunities for innovation and collaboration. Web3 also allows for greater control and ownership of digital assets, which we believe will become increasingly important in the digital age. Given the advantages of Web3 technologies, experts expect the market to grow at a compound annual growth rate (CAGR) of 45% between 2022 and 2030.
As a leading investment platform, eToro is well-positioned to provide valuable Web3 insights and guidance to our clients. Our Smart Portfolio team includes experts in both traditional investing and the Web3 ecosystem, and we have applied the principles of portfolio management, such as diversification and risk management, to our Web3 Smart Portfolios. Risk management is important when investing in Web3 as asset prices can be volatile. Accordingly, we have developed three different investment strategies that will enable investors to gain exposure to the technologies while maintaining balanced and diversified portfolios.
Given the higher-risk nature of many Web3 assets, our approach is that investors may potentially allocate around 5–15% of their overall capital to these technologies.
In this guide, we will cover key Web3 technologies, trends to watch out for, investment approaches, and risks to avoid. Whether you are a seasoned investor or new to the world of Web3, this guide is here to help you navigate this emerging area of technology and achieve success on the investment front. We are committed to helping our clients achieve their investment goals in this rapidly evolving market. With our platform's direct exposure to the Web3 ecosystem, clients can invest in a range of projects and assets, while benefitting from our expertise and security measures.
Sincerely,The Investment Office Team
