Blockchain will seriously increase classic car and classic motorcycle prices over the coming five years. This is the one that no one saw coming, as its effects will be profound. Knight Frank have already published that classic car prices increased on average 330% over ten years until 2017. Many motorcycles have increased by that amount over the last ten years, but they were ridiculously undervalued and still are. Blockchain allows anyone to own a tiny percentage of a classic car or motorcycle, making it accessible to everyone at any price point. Blockchain has already started to find its feet in the classic car and other collectible markets as you can read about here.
What is blockchain?
So, what is blockchain? Blockchain is the technological platform that records data and the record is irreversible. It is the technology behind cryptocurrencies such as Bitcoin and allows records of each transaction to be recorded and allocated to an owner. It won’t be long before all house sales are undertaken using this technology instead of all aspects going through solicitors. This technology is a far larger disruptor and game changer than Bitcoin has been, it will revolutionise investment in tangible assets profoundly. There are already classic car funds providing this service and it throws open access to these collectibles to anyone anywhere in the world at any price point at all. CurioInvest and Merj are two companies already providing this service, so this is already happening. I believe that there are other players as well and this is clearly the future.
Classic car and classic motorcycle funds already cover this
Classic car and classic motorcycle funds already cover this, however, they are engulfed in regulation, legal fees and compliance. All of these cause friction and incur very high costs which undermine profits for all of the investors. These are the reasons why classic car and classic motorcycle funds have not covered themselves in glory. This technology allows anyone, anywhere in the world to invest in a Ferrari GTO or Ducati green frame from as little as £10. There are none of the costs or compliance frictions of creating a fund. This technology has now made it possible for three friends to pool their money and buy into a classic motorcycle of their choice that they couldn’t afford before.
Classic car and classic motorcycle stock exchange in your pocket.
This technology has effectively created a classic car and classic motorcycle stock exchange in your pocket. The cost of these assets is no longer a barrier to entry for anyone anywhere in the world. An investment club now has access to these machines, as long as there is a third party who will store the vehicles. Vehicle storage is a massively growing business and there are plenty of facilities through out the world willing to oblige. The opening of these markets to so many new investors will profoundly increase values.
Values of classic cars and classic motorcycles will severely increase
Values of classic cars and classic motorcycles will severely increase, as this will revolutionise demand like nothing else has in the past. I’ve been writing about the demographic drives behind classic motorcycle price increases for more than six years, as you can see here. It is well documented that young motorcyclists are shying away and everyone in every market is trying to woo the young tech investors with little success. Tangible assets have not got the appeal for these tech whizz kids, but Blockchain does offer an appeal to them. Certain young uberwealthy tech billionaires have now started placing large quantities of their wealth into the highest value classic cars on the planet. The wheel is turning and they are citing Blockchain. There are less than forty Ferrari GTOs in the world but there are 3,000 billionaires in the world. When you add a further five billion investors in the world with a small amount to invest at different price points, it’s easy to see where the demand side of this particular equation is headed. These young tech billionaires understand this and can now see the way forward, which is why they are now making their moves on the classic scene. These people certainly know something that we don’t and are incredibly shrewd investors, that’s how they became billionaires.
Now is the time to invest
Now is clearly the time to invest in the classic motorcycle and classic car market. Blockchain is opening this once closed market up to the world. Investment in this unstable world has become so unpredictable and the appeal of tangible assets shows no sign of abating. Investment grade classic motorcycles and cars are incredibly hard to find. There are plenty of nice shiny looking examples, but they are not investment grade. The appeal of this market is that money has been, and is being, printed which dilutes its value. Classic cars and classic motorcycles are very limited in their numbers, especially in investment grade condition. No one can produce more of them or dilute their value in any way, unlike shares, fiat currency and bonds. The rarer the vehicle, the more appeal to investors and the greater the demand. The greater the demand, the better the returns and the investment grade classic vehicle is now seriously coming into its own, over the shiny incorrect example. There will be a time when all classics, that are investment grade, will be owned in this way because the cost of an entire vehicle will be just too great.
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