Bitcoin: A good or bad investment
Notice: First of all, This is not official Finacial advice. Also, we are not Finacial Experts. We are just speaking loud our thoughts and our opinion on this important topic ” Bitcoin: A good or bad investment “. So, We are not responsible for anything you may do or decide to do after reading this.
When we think of traveling, wherever in the world, the first thing we consider is the currency of that country and to exchange the currency with country’s one is the first task we do when we enter in the new country as there are different for different ones, you can’t use euro in united states and vice versa. Well, investing in cryptocurrency ( bitcoin ) is much similar to exchanging your money in another country. The currencies work in a specific process or context with specialized online communities and bitcoin, Litecoin, ether and many others are examples of foreign countries.
As we all know, currencies like dollar, pounds, euros have great worth for us because we can use them for better services with them. You might have heard a lot about bitcoin these days as everyone is talking about it and made up their mind to invest in it as they would be millionaires overnight.
So, before investing let’s discuss some details about it
What is cryptocurrency?
Cryptocurrency is the numeric data that people use for online purchasing and investment. There are many other kinds of cryptocurrencies like ether, bitcoin lite, ripple, bitcoin cash but bitcoin is the most famous among them. These all are getting popular day by day and even Facebook has created a cryptocurrency called Libra.
It might be interesting to know that cryptocurrency means the art of writing and solving codes and each coin has its own line of code.
They can’t be copied and this feature made it easy to track and identify whether they are copied or not.
Benefits of bitcoin investment
The overwhelming performance of bitcoin has attracted many traditional investors. It is overall an easy way to invest that is the big reason why everyone got attracted to it.
Liquidity: due to the worldwide establishment of trading platforms, exchanges, and online brokerages, bitcoin can be easily traded for cash or assets like gold instantly at low fees which makes it the most liquid investment asset. If you need a short-term profit, the high liquidity associated with bitcoin proves it to be the best investment vessel for investors as well as digital currencies have high market demand.
Lower inflation risk: the blockchain system in cryptocurrencies is infinite and hence you don’t need to worry about losing the value of your cryptos as bitcoin is immune to inflation unlike those currencies that are regulated by their government
New opportunities: bitcoin and cryptocurrency are now very inn in the news and are becoming mainstream on a daily basis. You never know what will change tomorrow and there are more chances of swings in invalidity and price, that’s how you can gain massive options for more gain.
Minimalistic trading: you need to have a certificate of license for stock trading hence you need a broker to have a reach to the company’s share. But the process of making money through bitcoin is much simpler as you just have to buy and sell bitcoin from exchanges and put them in your wallet. Unlike other stock trading orders bitcoin doesn’t take weeks or days in fact it is an instant process.
Bitcoin as a bad investment
Currencies are a sensitive topic so we should be well known for their advantages and disadvantages before investing money in them.
Volatility: we can’t trust the system until we get any benefits from them. The same is with bitcoin as its prices keep on going back and forth. Suppose you bought bitcoin on December 18, 2017, for $20,000. After a few weeks, you can’t sell your investment for more than $7,051. Nothing is predictable about bitcoin’s market, so it is hard to get benefits in return, you need to deeply check the market to avoid big losses.
The threat of online hacking: hacking can be a big threat to the investors by the hackers, you have to buy and sell your cryptos using a website or app. This could be a big chance for the hacker to theft all of your investment plus exchanging currencies that are not insured by FDIC
Little or no regulations: there is still no proper regulations in the bitcoin market and the government has shown no concerns and stance on it and you can be suspicious and can be caught in fraud cases
Limits use: it is accepted by a few online merchants and companies still not considering them as a legitimate exchange that gets the uses in doubt plus there is only a fixed supply of bitcoin of 21 million.
Wallets can be lost: as all the money is saved in your wallet and if it is faced by a virus and get crash, it can change you from a healthy one to a bankrupt plus you will lose all the investment plus profit
Bitcoin money can be exchanged with real cash
Bitcoin is meant to exchange and can be done in different ways, it can be sold out on a cryptocurrency exchange like Coinbase or Kraken and then it will be converted into your bank account. There are also some websites that allow you to sell bitcoin for prepaid debit cards. So, if there is an ATM near you, you can exchange it for cash.
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