1 1 1
Despite the on and off acceptance by the government towards this virtual form of currency, yet millions of people across the globe are investing in cryptocurrency. Being unregulated and uncontrolled has become the hottest form of currency and its reflective pricing has not stopped people from considering the usage of cryptocurrency. It is in the market from last 8 years with a market cap of 180 million dollars summing to about 1% of world GDP. If there are people, on one hand, have not heard much about this booming currency, yet on other side, people are busy investing in it. Since the year 2011, they have been seen an increase in its value with rising rise of so many forms of cryptocurrency. Now the question arises. Is this virtual asset really a valuable asset? Let’s look into whether it is a safe bet or not and how is different than other forms of investment.
Pluses of Investing in Cryptocurrency:
Recent market study has shown stable growth rates as far most of the currencies are concerned and is estimated for the trend to continue.
Most big companies to retailers have already started to use this form of currency and slowly even Government is warming up towards legal use of cryptocurrency.
It is more transparent and fraud free.
Billions of people access the internet every day, making this form of currency accessible to everyone.
Acts as immediate settlement while purchasing of assets such as real-life property.
There are no transactional fee levied for the exchange of cryptocurrencies.
Financial and political instability will make cryptocurrency way of storing savings over fiat currency more reliable.
Minuses of Investing in Cryptocurrency:
Investing in the currencies at a bulk without understanding it.
Even though there is a boom in this currency yet it is not acceptable legally making cryptocurrency irrelevant.
Volatile nature of the currency. Predictions state that the faster rate the currency is rising, the sooner will it fall. Making it suitable for short-term transactions rather than long-term plans.
Stock market versus Company versus Cryptocurrency investment:
Investing in cryptocurrency is not like the normal investment in stocks. Stocks is part owner of a corporation’s assets. While investing in stocks, people follow the rule of buying it at a low price and selling it at a higher price.
As far as cryptocurrency is concerned, investing in it means putting your money into an unregulated and volatile digital asset. When compared with stocks, it looks like a risky affair in investing in cryptocurrency. On return point of view, cryptocurrency has higher values than stocks. Stocks are also risky with its rise and fall of value, yet the volatile nature of cryptocurrencies is very high with a huge dip in value when it falls. While investing in stocks one need starting capital unlike is the case of cryptocurrency with zero capital. The liquidity of stocks depends on the bid while that in case of cryptocurrency depends on the method of receiving the cash. On the hand, stocks seem as a long-term investment where the loses can be made up with dividends, while in case of virtual currency seems tempting yet loses can be huge with no way to make up for it. In short investing your earnings into something known as stocks seems a clever investment than something unknown like cryptocurrency.
In short, the type of market one wants to invest solely depends on knowledge and objective of investment. To begin with, one can start by buying some coins of any form of cryptocurrency and investing remaining in another form of investment if in near future the value of the virtual currency rises, you made some investment else you will not have much to lose. Investing in cryptocurrency is a risk solely which depends if one is willing to take it or not.