Why I need to invest in Crypto Currencies?
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| Why I need to invest in Crypto Currencies? |
INTRODUCTION
Cryptocurrencies are digital currencies that have no centralized authority, they’re decentralized. In other words, cryptocurrencies aren’t controlled by any central bank like the Federal Reserve System in the US, the Bank of England or the ECB; rather, cryptocurrencies are created through complex cryptographic protocols making them extremely difficult and costly to manipulate. This means that cryptocurrency transactions can be trusted and won't require any form of government approval. Cryptocurrency uses blockchain technology, allowing secure and instant transfer of funds.
The first cryptocurrency was Bitcoin, which came into existence in 2009, but it has seen many competitors enter over time. Ethereum, Litecoin, Ripple XRP, Dash, EOS, Monero, Stellar Lumens (XLM) and Zcash are just some examples of cryptocurrencies that have been released since then. Each coin differs from each other based on their use case and overall goal.
There are three main reasons why people invest in cryptocurrencies today. Firstly, the value of cryptocurrencies have increased dramatically in recent years. Secondly, the underlying technology behind crypto currencies, blockchain, offers huge potential benefits across industries. And thirdly, investing in cryptocurrencies allows investors to hedge against future volatility in traditional markets.
We take a quick look at Bitcoin's history, and then we explain what makes blockchains different and exciting. We then move onto explaining what we mean by the word token. And finally, we give our thoughts on why you should consider buying, holding, and trading your own cryptocurrencies.
What are Pros and Cons of Cryptocurrency?
Pros:
-Cryptocurrency has been around for quite some time now, but not many people know about them; this leads investors to believe that they are safe investments. However, there are many types of cryptocurrencies out there and most do not have much value.
-There are no transaction fees if you choose to go through Coinbase to deposit your money into any cryptocurrency.
-You can access your funds 24/7 since you have it stored online. There aren't any hours where you won't be able to withdraw your funds.
-It's easy to transfer money from place to place using cryptocurrency; however, withdrawing money can be difficult depending on where you use it.
Cons:
1. High volatility
Cryptocurrency prices are volatile due to its unregulated nature. This means that cryptocurrency traders can experience gains/losses when the market swings between bullish and bearish trends.
2. Lack of regulations
Unlike traditional fiat currencies, cryptocurrencies do not have any regulatory structures in place. Because they aren't issued or backed by a central bank or government, they have no way of regulating their value.
3. Fraud
Fraudsters can easily manipulate transactions and make them undetectable, making cryptocurrencies a target for hackers. In January 2018, $7 million worth of bitcoins were stolen from Tokyo-based bitcoin exchange Coincheck.
What is the future of Cryptocurrencies?
We've all seen the news reports about how cryptocurrencies are becoming more mainstream and we know that blockchain technology has revolutionized how people make transactions online. However, the future of cryptocurrency may not be just about making transactions easier. As our society becomes increasingly digitized, we might see the rise of digital currencies being used for other purposes.
In this video, I discuss what the future of cryptocurrencies could look like if they do become more commonly integrated into everyday life.
What are your thoughts about cryptocurrency? Do you think that these currencies can take over banking or already have a significant place in the world today? Let me know in the comments below!
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