The market of cryptocurrency is unpredictable, but investors still invest, and the outcome always remains a mystery. That mystery provides a thrill to investors across the gold, and the investors always seek new digital currency to invest in. In 2009, an excellent digital currency was released by a mysterious entity, and since then, it keeps on growing and gaining popularity. Bitcoin is a decentralized digital currency that is not governed by the government or central authority.
No doubt, the market of bitcoin is just like an uncertain cryptocurrency, and therefore businesses and agencies find it risky to invest in bitcoin. Investing in bitcoin is just like gambling, but it carries some risks. The main risk is to market, and price dropping and online hacking and the incident of crashed hard drive can occur, leaving the investor with no alternative.
Is it risky to invest in bitcoin?
Since 2009 till today, the bitcoin market has been dramatic and has seen some excruciating crashes, but still, it managed to retain noteworthy gains. Since its introduction, it has been the first digital asset to produce the network of cryptos. The craze of investing in bitcoins among young investors has increased, and there can see profits shortly. It is an ultimate solution to modern-world problems of investing and anon system, and there’s no possible replacement of it till now.
Merits of Investing in Bitcoin
The outstanding performance of bitcoin has made people realize that this is the best investment that involves nearly no risk. Also, the performance of bitcoins has attracted people to invest in it. Bitcoin, as a decentralized currency, offers many merits to users when compared to traditional investments which are as follows:
Low Inflation Risk
Unlike fiat currencies that are controlled and regulated by the government, bitcoin is invulnerable to inflation. The blockchain technology used in verifying the transactions and maintaining a secure environment has offered users a secure place to invest. Investors are not at all worried about losing their funds that may happen in other cryptocurrencies.
Due to the establishment of exchanges, online brokerages, and trading platforms, bitcoin is considered as the main liquid investment asset. Trading bitcoins for assets and cash involves less risk and fees. Due to high liquidity linked with bitcoins, it makes it the best investment craft for people who are gazing to invest in getting short-term profits.
New and better opportunities
Cryptocurrency and bitcoin trading are quite young and are becoming popular by each passing day. The new coins are getting conventional in everyday life, and this newness carries changeable swings in volatility and price. These changeable swings can offer great opportunities that can lead to massive profits in bitcoin.
To stock trade, a trader must have a license or a certificate. Also, it is crucial to have the experience to trade shares of the company through a broker. Bitcoin trading is minimalistic trading because it is easy to buy and sell bitcoins, and the investors and traders can even locate them in a bitcoin wallet. It is easy to send and receive bitcoins because the bitcoin wallet has made transactions instant. It is not like stock trading orders that will take many days to process.
Demerits of Investing in Bitcoin
Menace of online hacking or theft
Hackers make it difficult for new investors to invest in bitcoin by threatening them about online hacking. Bitcoin transactions occur through mobile devices and websites, which makes it chances of hacking and theft of your funds. Also, bitcoins detained on exchanges are not insured by FDIC, which led to higher chances of theft and hacking.
As said earlier, bitcoin has seen some uncertain things, and the market increase and decrease according to the demand of investors and traders. The market keeps on continually changing, which makes it unsure that bitcoins will offer a good return on your invested funds. It is important to keep a close check on the uncertain market of bitcoins and be aware every time to avoid any loss.
Just like a coin that has two sides, there are always two aspects of a thing and so do bitcoin has. It is imperative to gain knowledge on all the merits and demerits involved in the investment of bitcoin.