5 Pros and Cons of Investing in Cryptocurrencies
If you want to invest in something that will late bring you some profit, the first thing that may come to your mind are cryptocurrencies.They have great potential for a huge revenue, but like every other investment, they come with a few risks. Virtual money gained its popularity a few years ago when its value was huge compared to the real cash.
Before you start investing and trading with Bitcoin, Ethereum, or other crypto coins, you need to have strong knowledge about the advantages, but also for the risks of your actions. Next, you need to be ready for a long process of mining and solving medium or hard math and cryptography problems, so you can find your virtual coins waiting for you in the blockchain network. Cryptos are widely accepted in some parts of the world, but in others, you need to respect the laws and policies. Before you even think about crypto investment, you need to be informed about all the possible law problems you may have in your country.
Many famous personalities already confirmed that they earned money when the cryptos hit their highest values last year. But, you need to know that, like every other activity, crypto investing has advantages and disadvantages. Here are a few things that you must know before you log in to some exchange platform:
1. Great liquidity and transparency
Every transaction is transparent and you are always informed how much is your cryptocurrency worth. Every step is verified by you and the exchange platform and you always can read the terms and details for your investment. Because of the liquidity, you will be able to trade them or exchange for other cryptos. The possibilities are endless, especially when you have experience in this market.
2. Big chances for great profit
Today, one Bitcoin is about $9,825, but just two years ago its worth reached $18,783. 2017 was an incredible year for all cryptocurrency investors because much other digital money hit their peak then. But, the fluctuations are big. In the first months of 2017, one Bitcoin was equal to $1,000. Many investors are collecting these coins in their digital wallets, so they can wait for better rates that will bring them even bigger profit. Today, the crypto worth is lower than last year because of the coronavirus crisis, which was expected.
3. Trusted trading platforms
If you use trusted trading platforms, you can be sure that you won’t need to pay high fees and memberships. According to btcrevolution.io, you only need a few minutes every day to gain high profits with your Bitcoins and enjoy financial freedom at the same time.
4. Anonymous and encrypted transactions
Every transaction is anonymous and encrypted. From the moment you start investing, when you use legitimate channels, you are protected from scams and illegal transactions. That is why you must choose verified websites to trade your crypto money.
5. Easily accessible money
Once you withdraw your crypto coins to your e-wallet, they are all yours and you can decide what to do with them. Also, you need to know that you have virtual wallets and physical wallets. It’s always better to own a hardware wallet that is similar to a bank token, so you can decrease the risk of cyber-attacks.
Also, crypto investment has its own cons and disadvantages that you should be aware of, including:
1. Network failing
The blockchain network is pretty stable most of the time. But, no one can guarantee that the situation will be the same tomorrow or next month. So, you need to know that every cyberspace has vulnerabilities, so be sure that you always withdraw the earned digital money to your e-wallet, so you won’t lose too much if somehow the network crashes.
2. Increased chance for mismanagement
You always need to know what you do and why you do it. This market is not simple so you can always oversee something. Try to invest alone, so you can see how it goes before you expand the job with a team. You need to have a solid base to build your crypto business.
3. Cryptocurrencies are uncertain
Since these currencies are decentralized and no bank is able to follow the transaction paths, you need to know that their value can change. Sometimes you can expect high rates, but sometimes it is so low that it’s not worth the money and effort. But, the game can change every moment. Compared to the previous weeks, many cryptocurrencies grew from 2% to 6%.
4. Vulnerable security
Everything that exists in cyberspace is vulnerable and not 100% secure. Developers and companies always try to increase online security, but at the same time, hackers try to find breaches, so they can attack. Nothing is 100% safe and secure, including blockchain networks and trading platforms. But, the good news is that they do everything in their power to protect the investors.
5. Unclear regulations
Every country has regulations and policies for crypto trading. Some of them allow the investors to earn and trade, but they can’t use the money as a verified paying method anywhere. Even though this point is last in this article, pay attention to your local laws, so you won’t lose time doing something that is not allowed or regulated.
Before you start anything, never mind if that is some business or blockchain project, you need to be fully informed about every aspect. We hope that our article will help you to learn some of the greatest pros and cons of cryptocurrency investment. Also, in cases like this, you need to trust your gut and if it tells you to wait for a little, do that, so you won’t be sorry soon. Every financial investment is risky and you may lose a lot of money, but the chances to make a profit are also here. You only need to be smart and start the business at the moment you are ready to risk, and also to be rich. Crypto money will soon be widely recognized and accepted and if you think you can do that, then start with a small investment and increase it when you are sure you can do that.