San Francisco-based Kraken, partnering with The Economist, initiated an interesting case study with university MBA groups from around the globe. The teams from multiple universities were asked to submit investment proposals for bitcoin or ether for a chance to win $10,000.
Which Investment Will Be More Lucrative: Bitcoin or Ethereum?
The school teams have finished their proposals and now the voting begins.
Based on a five-year investment cycle, the groups were asked what would they do if they had $1 million USD to invest in either bitcoin, ether or both. The proposals describe how much the MBAs would invest in each and why they would choose a particular direction. Kraken founder and CEO Jesse Powell said is firm is providing this learning environment for people to get a better grasp of digital assets.
“This competition is an opportunity for you guys to learn about digital assets and take what you’ve learned and develop a profitable digital asset investment strategy,” he explained to contestants. “We’re asking you to help us answer a question that has been hotly debated in the industry over the last year. Which is the digital asset of the future? Is it bitcoin, ethereum, or both?”
MBA Programs Submit Investment Proposals
The proposal contest asks the university groups to create a 2-3 minute video that beginners can understand, but which also demonstrates knowledge of investment skills. First place will win $10,000, second $5,000, third $3,000, and the “people’s choice” will win $3,000. MBA programs who participated include: the BYU Marriott School of Management, Creighton University, FIA Business School, Johns Hopkins Carey Business School, Tulane University, and much more. Each school provided a video and written explanation of the group’s choices.
School have submitted proposals with video content and, after being reviewed, can receive anonymous votes here. Proposals were fascinating, with many of the school teams choosing a larger bitcoin investment over ether. The only programs that did not favor bitcoin were Porto Business School, Worcester Polytechnic Institute, Rutgers, and Ivey Business School at Western University.
For instance, Rutgers’ video and written proposal shows ether leading in final price over bitcoin based on the team’s regression model. The group went over the historical prices and forecast prices since the cryptocurrency’s inception. However, Rutgers believed both cryptocurrencies will fall by the wayside in the coming years.
“Although we do not believe in cryptocurrencies in the long run, there is significant potential for the underlying technology to be used to increase the efficiency and transparency of trade,” said the Rutgers team.
Most Case Studies Show Bitcoin’s Network Effect Casting a Large Shadow Over Ethereum
Most of the other MBAs’ case studies chose bitcoin as the choice investment over the next five years. The majority of schools gave bitcoin a 60-80% ratio over ethereum for multiple reasons. Team BYU chose 78% bitcoin over 22% ether with a $1M investment over the next five years. The reasons bitcoin was selected by BYU included security, liquidity, sentiment, supply, and other network effects.
“Allocating 78% to bitcoin and 22% to ether provides a better balance,” BYU’s investment proposal stated. “This midpoint approach has three distinct advantages. First, we allocate the majority of the funds in the higher ranked, proven asset. Second, we are still able to participate in the potential upside inherent in ether. Third, we diversify our portfolio as the two cryptocurrencies show no correlation.”
Overall, reading all the proposals and watching the case study videos can give beginners knowledge about these digital assets. That seems to be the primary goal for Kraken and The Economist — teaching the masses digital asset benefits through academic knowledge.
All the university team videos and full solution proposals can be viewed here.
What do you think about the investment solutions the student teams provided? What investment strategy would you choose? Let us know in the comments below.
Images courtesy of Bitcoin.com, Kraken, and Pixabay.
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