An esteemed investor, Mike Alfred, has recently shared his insights on companies engaged in the production of the world’s first cryptocurrency.
According to him, in the current market scenario, such firms represent an alluring investment proposition.
Alfred is of the opinion that mining companies are endowed with “operational leverage” due to the surge in the value of Bitcoin.
While many investors consider investing in such companies to be quite perilous, he is confident that they are among the safest options in the market.
Alfred clarifies that determining the actual value of such firms is not an exact science and depends on various factors, including price.
He believes that while several mining companies were overpriced in 2021, some of them are undervalued in 2023 due to the cyclical nature of the market.
Alfred recommends investing in high-quality infrastructure operators, particularly those that are currently trading below their intrinsic value, as conservative investors are often satisfied with low returns instead of seeking out risk-adjusted assets.
He suggests that investors should look at the profits in 2025, when the economic cycle is complete, to gauge the success of their investments.
The expert advises investing in companies that possess the skills to develop infrastructure, manage various aspects of the mining process such as energy procurement, building data centers, and creating computing power for the Bitcoin network.
The simplicity of their business model, combined with the operational leverage resulting from rising BTC prices, makes them a fascinating investment prospect.
It is worth noting that an article published by Bits.media highlights how the green trend can enhance the resilience of the Bitcoin network