Bitcoin (BTC) and other cryptocurrencies have been compared to FAANG (Facebook (NASDAQ:FB), Apple (NASDAQ:AAPL), Amazon (NASDAQ:AMZN), Netflix (NASDAQ:NFLX) and Google (NASDAQ:GOOGL)) companies due to their network effects, as reported by Cointelegraph. The rationale that the increase in people using a platform makes its value increase exponentially — as it happens with Facebook or the App Store — is applied to cryptocurrencies at large: The more people that hold a crypto asset, the bigger increase in market value.
Further reports have suggested that these companies intend to launch their coins after Facebook’s Libra introduction to the market. Some of these companies have been the darlings of the stock market, but recent shifts in consumer preferences show that a segment of the population (i.e., millennials) already prefer investing in Bitcoin instead of FAANG stocks like Netflix. While this is intriguing, the question is: Are investors better off investing in Bitcoin and other cryptocurrencies than in FAANG stocks?