It’s incredible what big cryptocurrencies have grown to be. It’s been 10 years since the flagship cryptocurrency rocked the scene. The industry is growing stronger. And critics are eating a humble pie on this one. Cryptocurrencies have really surprised many. No virtual currency can be compared to crypto.
The industry has grown strong. A few price corrections and a bearish trend witnessed last year might make you think otherwise but what doesn’t kill you makes you stronger. And that’s the case for crypto at the moment. But that’s the subject matter for another day. Today, we explore something different.
Crypto prices have been on an uptrend, although coupled by a few corrections. But that hasn’t stopped crypto’s value from improving. For this reason, many are now interested in crypto, though they don’t quite understand its basics. We highlight some of the things you need to know before investing in cryptocurrencies;
US Regulations On The Industry
The significance of the crypto industry hasn’t passed the US government. They know that cryptocurrencies can have a huge impact on the economy. Two bills supporting cryptocurrencies have already been introduced in the House of Representatives. The purpose of the bills is essentially, to regulate the industry and protect consumers against the ill motives of scammers. And that’s how you know cryptocurrencies have a future- when the government steps in to provide for regulations.
Cryptocurrencies Are Very Volatile
Cryptocurrencies are highly volatile. Bitcoin’s value peaked in December 2017 at $20,000. Those who had invested in the cryptocurrency earlier were lucky. They became millionaires overnight.
Now, exactly a year later, bitcoins price was below $4,000. The general cryptocurrency market had lost over 80% in value. Things have improved though, the value is now halfway what it was in 2017. And that’s the nature of cryptocurrencies. Consider it just like any other investment, invest what you can afford to lose. Conduct proper research on a coin before investing. That way you reduce the risk of being duped.
Invest A Portion Of Your Portfolio
Some investment bankers share the opinion that cryptocurrencies, like bitcoin is misunderstood yet the most important asset. Others that have no idea how it works call it a scam.
Cryptocurrencies can be used in diversifying investment portfolios. Cryptocurrencies are really disrupting technology and the financial system. Bitcoin may be the clear leader at the moment but other altcoins are coming up. It’s only a matter of time before they become mainstream.
Aiding Business Transactions
Cryptocurrencies are eliminating the need for third parties in money transfer. You only need a wallet and public and private keys to make transactions. Consequently, the need for transaction fees and intermediaries associated with it has been eliminated. And the blockchain technology supporting it, which minimizes hacking chances even make cryptocurrencies better.
Investing in crypto is like no other investment. A lot of dynamics are involved and it’s hard, establishing a consistent pattern. Sometimes speculation is all you can do besides hoping for the best.
If you forget everything we have written here, remember to always learn the industry. Invest with what you can afford to lose.